Why Gold? It's useless!! 4

[Unotec]

Didn't know where to start this useless rant but here it goes (and probably explains why I'm an engineer and not a financial guy).

We, engineers, build stuff, value things that are useful and don't mind paying a little extra for something that will outperform cheaper things.

Now, with this financial crisis all I read is BUY GOLD, actual gold coins!! (yes, the buy, put in a chest and bury in your backyard type)

If gold is useless, well, has some very limited applications, why is it that is still considered so valuable?

If you think of it, stuff like diamonds or gems in general.... They are, in a practical useful way, WORTHLESS!! The most expensive things in life are typically the most useless!

What will happen if the economy tumbles further enough that people start now looking for things they actually need instead of treasuring something they can’t eat, drink or easily build with?

Gold is practically useless as far as my limited knowledge goes, but it will apparently hold its value.

Could the root of the financial troubles be that they are based on a thing as useless as gold?

Aztecs used to value corn as a currency, Romans salt, etc...


<<A good friend will bail you out of jail, but a true friend
will be sitting beside you saying ” Damn that was fun!” - Unknown>>

 

[rhodie]

In Occupied France during the 1940's, those who sold women's cosmetics enjoyed income while other 'affordable luxuries' went unpurchased.

 

[cranky108]

I don't think any storage of wealth that isen't easy trade or use isen't a good idea. That's the advantage of liquor.

On the other hand, if you can't transport it easy it creats another risk, such as loss from mother nature.

But being easy to transport makes it easy to steal.

Rhus the advantage of bank or brokerage accounts.

 

[DarrellThomasNV]

try this video:

http://www.themoneymasters.com/

it explains alot about how money (and gold) work.

 

[BorisVian]

Hey everyone!

Althrough you all hitted very close to target with its physical properties and role in monetary systems, there is a combination of two elements you are missing:

eye appealing and rarety!

If it wasn't eye appealing, no one would want to wear it as jewelry and if it wasn't rare, it wouldn't be the symbol of wealth and power in ancient civilisations.

and from the symbol it was, it became culture in certain parts of the modern world, India for example.

just shows how much we are emotional being instead of rational ones!!

 

[KENAT]

I'm pretty sure those were mentioned. "shiny eye candy" ring a bell?

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[SomptingGuy]

Never tarnishes. Dig up a relic, wash off the mud and it still shines. Touches on the desire for immortality.

- Steve

 

[cranky108]

A good point, but a fine wine also has those qualities.

 

[KENAT]

What? I'll pass on the several thousand year old bottle of wine thanks and take the gold.

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[ChrisDuncan]

Gold is the most malleable and ductile of all pure metals. It can be beaten so thin you can see through it.

Gold reflects infrared and visible light as well as radio waves, it is used for the protective coatings on many artificial satellites, in infrared protective faceplates in thermal protection suits, astronaut's helmets, and welding helmets.

 

[mauricestoker]

My old underwear is golden and so thin you can see through it, and it forms a protective barrier from gaseous release for the people around me. That somehow still does not make them attractive, even to females.

 

[ornerynorsk]

Maurice, you need to rework it into more of a toroid shaped object and cement a shiny rock onto it. Females, for some reason, will then find it more attractive!

 

[mauricestoker]

I tried the old potato trick, but no one told me that the potato goes in front.

 

[cranky108]

Isen't gold used as a conductor in semiconductors manufacture? So there is a use other than shiney trinkets.

But back to the orignal concern, they do make copper, nickle, silver, and platinum coins (maybe not with a demonition on them). So if you don't like gold, buy some other type of coin.

If your old underwear is golden, then you need to make a trip to a store to replace them.

 

[drawoh]

cranky108,

Gold coins, platinum coins, nickel coins and coins of whatever other material you may think of, are not self-transporting. Cattle are used as wealth in a few parts of the world. They are self transporting.

This could be the start of an interesting robotics project.

JHG

 

[cranky108]

What is this thing with self transporting?

The change pocket in my car is self transporting, so is anything in it.

A cow or robot, or a car cost something to self transport. So why exactly do you want or need it?

Or I guess you could invest in cars, they do have a value, but they generally don't increase in value, and can even be worth less than the metal value.

 

[mauricestoker]

Since when is money not self-transporting? You must not be married with children.

 

[bimr]

The problem with gold as a money supply is that gold is a commodity. Like all commodities, the value of gold is dependent on the supply of gold and the demand for gold.

Gold is dug up out of the earth and then consumed in industry and for consumer goods. The amount of gold dug up out of the ground varies with the luck of the miner and the money available to find gold. The use in industry varies with the economic outlook.

If you picked a commodity to use as a money, why would you pick gold? You could just as well as another commodity like pork bellies, wheat, or something else.

The only thing interesting about gold is that you can hear the same ads for gold on both the extreme right wing talk shows (m weiner et al) and the middle of the road talk shows (air america). The people that listen to talk radio seem to have little knowledge of economics.

 

[ewh]

You would have to take care as to what other commodity you chose. Wheat is great until it gets moldy or eaten by rats. I don't even want to go into pork bellies.

Before the invention of central currency, localities experienced booming times. Commodities such as wheat had to be spent before they went bad, and that spending was local. Municipalities were flush enough to begin the boom in cathedral construction. When the reigning powers realized that they had no control over the real wealth of their countries, they started introducing "coins of the realm", which gave them the absolute control that they desired. They were the only ones allowed to "create" such wealth. Fast forward to today with the Fed, the IMF and the World Bank, and it's easy to see that they aren't going to be willing to give up any of that control without a fight.
So, yes, using commodities for wealth exchange once more may indeed be a better overall solution.

"Good to know you got shoes to wear when you find the floor." - [small]Robert Hunter[/small]

 

[cranky108]

It's true that the relitive value of gold depends on supply and demand, like pork bellies. However there are other minerals that also have a value, and somewhat long life.
This becomes an issue on weather to own gold or other things.

After all there isen't enough gold to feed the world demand, so other things with a value must stand in.
Silver comes to mind, as does gems, copper, nickle, and, platinum.

 

[ornerynorsk]

I'm with you on that one Maurice. I swear the stuff just evaporates out of my wallet some days. At least the oldest two are now gainfully employed and in the process of learning just how laborious it is to "dig gold".