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Gold is a greater-fool asset, just like Bitcoin. We buy it hoping a greater fool will pay us more for it later. Most of the value is what we ascribe to it. Clo

Gold is a greater-fool asset, just like Bitcoin. We buy it hoping a greater fool will pay us more for it later. Most of the value is what we ascribe to it. Close on 80% is used in jewelry. It doesn't actually make you money, there's no universal law that makes it more valuable over time. It's just stuff we like, same as art or classic cars or Bitcoin. We've just liked it for longer than those things, so we trust it more. but that isn't guaranteed. You can use non-greater fool assets to make money. A stock is a piece of a business that earned you money over time. A truck can be used to make money. Gold can be fashioned into more-valuable stuff but the real assets are the craftsmanship and tools. Gold is the commodity.

sumedh 9y ago
> We buy it hoping a greater fool will pay us more for it later. Well not exactly, the largest consumer of gold are Indians and they buy gold jewellery to show affluence. Most of the jewellery is passed down generations.
- richardw 9y ago
  Even less of an investment then. As an investment it's a greater fool one. If you buy it for non-investment purposes then the investment definition doesn't apply. Same as art or classic cars. If you buy it to resell, that's when it applies. If you buy it as an input into a business process then it doesn't, but that's not the common case.