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It's amusing watching people feign cluelessness and shit talk gold just because they think it will make the value of their bitcoins go up. I have no financial

by cb18 10y ago

It's amusing watching people feign cluelessness and shit talk gold just because they think it will make the value of their bitcoins go up. I have no financial interest in gold, I just try to understand the world through unbiased eyes. Yes gold has a long history of use as a currency for very logical reasons(it's resistance to corrosion and elemental scarcity among them,) it also has a long list of other uses both ancient and modern. It's 'artificial' value as a currency is not in any meaningful way different than the 'artificial' value assigned to any other object of limited supply of which people are desirous be that a concert ticket, a Picasso painting, or a bitcoin. Unlike a concert ticket, a Picasso painting, or a bitcoin, gold can also be used to coat a space helmet, make an electronic circuit, make jewelry, coat an object in gold leaf, etc. To think these other uses play no role in the market value of gold is naive. But even if these other uses didn't exist, and gold was still valued at the price it is now, good luck arguing against the emergent consensus of a market.

dragontamer 10y ago
I think Warren Buffet knows a thing or two about the value of things in the world. > Gold gets dug out of the ground in Africa, or some place, Then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. It has no utility. Anyone watching from Mars would be scratching their head. http://www.aaii.com/files/images/articles/9298-figure-1.jpg http://www.aaii.com/files/images/articles/9298-figure-1.jpg > gold can also be used to coat a space helmet, make an electronic circuit, make jewelry, coat an object in gold leaf, etc. If you're actually interested in a hedge against inflation, go buy Wheat and Oil. When hyperinflation hit the German Economy hard in the 1930s, that's what made tons of money. For as long as humans existed, and for as long as Humans remain on this planet, humans will need to eat. The value of Gold itself? That changes. A thousand years ago, one pound of Gold was worth one pound of salt. http://www.smithsonianeducation.org/educators/lesson_plans/currency/essay2.html http://www.smithsonianeducation.org/educators/lesson_plans/c...
- cb18 10y ago
  I'm happy to hear Buffet's thoughts on financial matters, but I'll still place more weight on the emergent consensus of a market. I understand his point, but in a sense gold's utility is it's non-utility. Or another sense is that most people have the same understanding of it, dollars and bitcoins have no inherent utility other than people have a shared understanding of what they are, and what they are for. Also understand that he is speaking as someone looking to allocate capital to receieve a return on that capital. There are other entities that would prefer something like gold, nation-states for example. So Buffett is just saying if you want to see your purchasing power appreciate, don't hold your money in currencies, but invest it in value producing companies. Salt Yes, as your link describes, salt use to be far more scarce and therefore commanded a far higher trade value. So it was actually that salt was far more expensive, rather than gold was cheaper. In fact the word salary comes from a latin word pertaining to salt. http://etymonline.com/index.php?allowed_in_frame=0&search=salary http://etymonline.com/index.php?allowed_in_frame=0&search=sa...

by cb18 10y ago

dragontamer 10y ago

I think Warren Buffet knows a thing or two about the value of things in the world. > Gold gets dug out of the ground in Africa, or some place, Then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. It has no utility. Anyone watching from Mars would be scratching their head. http://www.aaii.com/files/images/articles/9298-figure-1.jpg http://www.aaii.com/files/images/articles/9298-figure-1.jpg > gold can also be used to coat a space helmet, make an electronic circuit, make jewelry, coat an object in gold leaf, etc. If you're actually interested in a hedge against inflation, go buy Wheat and Oil. When hyperinflation hit the German Economy hard in the 1930s, that's what made tons of money. For as long as humans existed, and for as long as Humans remain on this planet, humans will need to eat. The value of Gold itself? That changes. A thousand years ago, one pound of Gold was worth one pound of salt. http://www.smithsonianeducation.org/educators/lesson_plans/currency/essay2.html http://www.smithsonianeducation.org/educators/lesson_plans/c...

cb18 10y ago
I'm happy to hear Buffet's thoughts on financial matters, but I'll still place more weight on the emergent consensus of a market. I understand his point, but in a sense gold's utility is it's non-utility. Or another sense is that most people have the same understanding of it, dollars and bitcoins have no inherent utility other than people have a shared understanding of what they are, and what they are for. Also understand that he is speaking as someone looking to allocate capital to receieve a return on that capital. There are other entities that would prefer something like gold, nation-states for example. So Buffett is just saying if you want to see your purchasing power appreciate, don't hold your money in currencies, but invest it in value producing companies. Salt Yes, as your link describes, salt use to be far more scarce and therefore commanded a far higher trade value. So it was actually that salt was far more expensive, rather than gold was cheaper. In fact the word salary comes from a latin word pertaining to salt. http://etymonline.com/index.php?allowed_in_frame=0&search=salary http://etymonline.com/index.php?allowed_in_frame=0&search=sa...