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Gold is money. Everything else is credit.
(J P Morgan’s statement to Congress in 1912)
{Except Silver
(Desert Dave’s statement to the world 30Apr2022)}
3. Gold coins might help. Still have the storage issue.
We once lived in an old (HUD repo) house until we could save up enough money to tear it down and build a store in its place.
One of the bedrooms had a hole in the wall where someone had slammed the door open so hard the doorknob had gone through the the wall.
I dropped one ounce gold Krugerrands into that hole for years.
When we were ready to tear the old house down I just kicked a hole in the wall under that hole and picked the Krugerrands out.
Desert (Yes, I checked VERY carefully) Dave
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Hi Peter
If I can get just a bit of inside information on where your gold is located, I can take it from you in just a minute or two. With a bit of planning, of course.
…and that’s exactly what you won’t get
How safe is your money in the bank - remember when you put it in the bank it ceases to be your money and you are an unsecured creditor of the bank. Don’t sound too safe to me.
Divitias:
Gold is money. Everything else is credit.
Gold didn’t save Bretton Woods. Money is just an accounting system, the wealth that you contributed to the economy. Just because you have accounts in your favor does not mean the economy will pay up. Ask Zimbabwe, Venezuela, or the Weimar Republic.
Fractional reserve banking makes a mockery of the Gold Standard. Do the math! Deposit $100 in gold and with a 10% reserve that $100 becomes $1000 in circulation $900 of which are not backed by gold.
The Captain
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A single ounce of gold can now buy a house in Venezuela because of hyperinflation
Total utter BS!
Gold climbed above $1,900 an ounce on Friday
https://tradingeconomics.com/commodity/gold
My 1100 sq. foot over 60 year old condo can fetch between 15 and 25 ounces of gold. Of course it’s a huge loss but NOT to the point of the stupid ‘single gold ounce’ nonsense. Chavistas, government cronies, have lots of dollars to buy anything they want. The Venezuelan economy has become dollarized. As elsewhere, it’s the poor and the salaried who get royally screwed. Street vendors (independent businessmen) deal in US$s.
The ‘single ounce of gold’ is probably what is recorded on the official documents to evade taxes. When I sold my beach condo I was amazed how the buyer and her lawyer got around the law. The deals are made in dollars or euros but the paperwork must be done in BS (bolívares)! Payments are made mostly in cash or by foreign bank transfers. Importers are happy to buy black market US$s and euros.
The Captain
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Gold didn’t save Bretton Woods
Of course not. But if you, as an individual, had held gold it would have saved you.
An ounce of gold in 1971, when the US defaulted on an international agreement, was $35. It is now approching $2,000. Doesn’t that tell you something?
Why are the world’s central banks loading up on gold?
Perhaps it’s just tradition, as Bernanke explains:
Ron Paul: Do you think gold is money?
Bernard Bernanke: (pause) no.
Ron Paul: Why do central banks hold gold?
Bernard Bernanke: Well, it’s tradition.
https://www.youtube.com/watch?v=iKYKLgzyF9o
In the future when the dollar, sterling and the euro are just a distant memory, my gold will still have value.
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In the future when the dollar, sterling and the euro are just a distant memory, my gold will still have value.
So… a thousand years from now your gold will still have value. Congratulations. I’m trying to see how that benefits you.
OK, a thousand is maybe a bridge too far. Suppose it’s a hundred. Same question.
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So… a thousand years from now your gold will still have value. Congratulations. I’m trying to see how that benefits you.
OK, a thousand is maybe a bridge too far. Suppose it’s a hundred. Same question.
Just proving a point about the durability of gold. It’s been around for thousands of years as currencies have come and gone.
I purchased my first gold coin (Britannia)in 2015 for £970. They are now being sold by dealers for £1,600 to £1,700. It’s also in my possession and not at the mercy of some crooked banker and won’t vanish if the grid fails.
You stick with your dollars if you wish to, I’ve no problem with that.
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and that’s exactly what you won’t get
I would count on that. Inside information isn’t all that hard to get. It may take nothing more than careful observation.
Besides, without the inside information it just takes a little longer to take your gold from you.
How safe is your money in the bank - remember when you put it in the bank it ceases to be your money and you are an unsecured creditor of the bank.
Wrong. In the US, the FDIC insures bank deposits. So you are in a better position than general unsecured creditors. The UK has the FSCS, which provides similar protection. If you are foolish enough to have deposits in excess of the protected amount, that’s your own fault.
—Peter
Wrong. In the US, the FDIC insures bank deposits. So you are in a better position than general unsecured creditors. The UK has the FSCS, which provides similar protection. If you are foolish enough to have deposits in excess of the protected amount, that’s your own fault.
I’m aware of this but am not too sure of how much an ‘insurance’ this really is. It was set to be introduced as an EU law but some countries (Germany i think) wouldn’t vote for it, so it’s just a suggestion at the moment. Some EU countries (Austria) don’t have any level of guarantee. When the bail in went ahead in Cyprus the government tries to remove the guarantee.
It may be different in the USA but I don’t have too much faith in the system - it relies on the banks and the government, the two institutions I least trust with my money.
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My crystal ball is always foggy. 
But being a Gemini, I like to think that I see both sides of everything. My wife has a long list of exceptions to that.
My portfolio is a diversified one, which includes a small amount of gold and silver (both junk silver, for practicality, and precious metal coins with some numismatic value).
But overall, gold is a horrible place to park large amounts of value over long periods of time.
https://www.macrotrends.net/2608/gold-price-vs-stock-market-…
It always makes me wonder when a seller pushes gold as the best place to keep value, but they’re perfectly happy to exchange my dollars for their gold.
Plus, I would hate to be around if our systems crashed so badly that the only means of trading is gold. It seems to me that at that point, I would have much bigger problems than trading gold for goods.
AW
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The Venezuelan economy has become dollarized. As elsewhere, it’s the poor and the salaried who get royally screwed. Street vendors (independent businessmen) deal in US$s.
Good money drives out bad wherever the seller has a choice.
The poor and the salaried had better get busy and open up apple carts and shoeshine stands.
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Hi AW
My portfolio is a diversified one, which includes a small amount of gold and silver (both junk silver, for practicality, and precious metal coins with some numismatic value).
But overall, gold is a horrible place to park large amounts of value over long periods of time.
My portfolio is also very diverse. I have about 10% in precious metals.
It always makes me wonder when a seller pushes gold as the best place to keep value, but they’re perfectly happy to exchange my dollars for their gold.
The dealers that I have spoken to explain that they don’t have large stocks of gold and will often sell gold that they don’t hold using their customers’ money to buy it.
I know a coin dealer who buys/sells gold coins. He makes a living by buying and selling - just holding gold produces no income for him, although he does ‘hold onto’ a bit for himself.
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In the future when the dollar, sterling and the euro are just a distant memory, my gold will still have value.
You got the rec for that;-)
So… a thousand years from now your gold will still have value. Congratulations. I’m trying to see how that benefits you.
OK, a thousand is maybe a bridge too far. Suppose it’s a hundred. Same question.
I’m not Divitias but I can answer what gold will (if I live that long) do for me in 100 or 1000 years.
Buy stuff!
IIRC gold has ALWAYS had value
Any stuff I want!
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It is now approching $2,000. Doesn’t that tell you something?
Yes two things, entry is everything…and do not assume gold is approaching $2000…odds are it is retreating from $2000. The USD is appreciating as are most major currencies.
The third thing it tells me is that gold investors are notoriously bad with modern econ. Rising interest rates gives an appreciation to the currency.
But if you, as an individual, had held gold it would have saved you.
FDR confiscated gold.
Doesn’t that tell you something?
That $35 per once was an artificial price, not the value set by a free market.
Why are the world’s central banks loading up on gold?
I don’t have a clue. You can’t eat the stuff. It’s expensive and risky to store. It’s not liquid like fiat money. Maybe central bankers are just stoopid. Maybe they went to graduate school and had good sense squeezed out of them. There are so many possibilities.
Seriously, money is ANYTHING that people agree on is money. So many things have been used as money. Like I said, it’s just an accounting system that records the wealth people have added to the economy. If central bankers agree that gold is money, FOR THEM, gold is money. In Venezuela the government thinks that ‘bolivares’ are money. The people don’t agree and use the bills to make origami.
https://www.google.com/search?q=bolivar+origami&newwindo…
In the future when the dollar, sterling and the euro are just a distant memory…
I’ll be dead. You?
The Captain
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You stick with your dollars if you wish to, I’ve no problem with that.
Whatever people accept as money is money.
The Captain
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My portfolio is also very diverse. I have about 10% in precious metals.
Real physical metal or pieces of paper or computer bits promising that you have the metal?
The Captain
Real physical metal or pieces of paper or computer bits promising that you have the metal?
If you don’t hold it you don’t own it!
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