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Gold at least has some unique purposes besides a store of value. Over half of it is used for jewelry and commercial reasons, so at worst it can be considered an

by Aunche 9y ago

Gold at least has some unique purposes besides a store of value. Over half of it is used for jewelry and commercial reasons, so at worst it can be considered an over-speculated commodity. Bitcoin literally has nothing going for it besides being the current market leader.

zanny 9y ago
If the International perception of gold being valuable disappeared overnight (which... yeah, won't happen unless someone discovers legit alchemy magic) the difference between losing 90% of your value or 100% if it had no use outside of the speculation shouldn't be influencing almost anyones decision in what to invest in. All the other parameters (volatility, profitability, etc) are way more important than if you are completely bankrupt or completely fucked if the market implodes.
- Aunche 9y ago
  My point is that gold can never lose 90% of its value because the majority of it is already used in luxury items and electronics. At worst, the total value of gold can only drop by the current amount that is being held in reserve or as investments.
  - bryanlarsen 9y ago
    Price is set at the margin. If half the demand for gold evaporated the price for gold would likely drop a lot more than 50%, probably more than 90%. When demand for gasoline went up by 2%, the price doubled.
  - hollerith 9y ago
    >the current amount that is being held in reserve or as investments --which is almost all of the gold in the world.
SubiculumCode 9y ago
Hardly anyone uses gold as a storage of value.
- VarFarYonder 9y ago
  > Hardly anyone uses gold as a storage of value https://en.wikipedia.org/wiki/Gold_reserve#Officially_reported_holdings https://en.wikipedia.org/wiki/Gold_reserve#Officially_report...
  - SubiculumCode 9y ago
    I meant individuals rarely keep gold as a store of value.
    - hollerith 9y ago
      It is not rare in South Asia.
    - VarFarYonder 9y ago
      > I meant individuals rarely keep gold as a store of value. I think individuals with an actual portfolio of investments will hold gold or have some exposure to gold. Also, you wouldn't expect gold to be widely held when you consider things like Executive Order 6102: https://en.wikipedia.org/wiki/Executive_Order_6102 https://en.wikipedia.org/wiki/Executive_Order_6102 Basically, the US government forced everyone to sell their gold in 1933. US citizens only regained the right to hold gold in 1974. Governments are going to find it much harder to enforce such an order when it comes to cryptocurrencies.

by Aunche 9y ago

zanny 9y ago

If the International perception of gold being valuable disappeared overnight (which... yeah, won't happen unless someone discovers legit alchemy magic) the difference between losing 90% of your value or 100% if it had no use outside of the speculation shouldn't be influencing almost anyones decision in what to invest in. All the other parameters (volatility, profitability, etc) are way more important than if you are completely bankrupt or completely fucked if the market implodes.

Aunche 9y ago
My point is that gold can never lose 90% of its value because the majority of it is already used in luxury items and electronics. At worst, the total value of gold can only drop by the current amount that is being held in reserve or as investments.
- bryanlarsen 9y ago
  Price is set at the margin. If half the demand for gold evaporated the price for gold would likely drop a lot more than 50%, probably more than 90%. When demand for gasoline went up by 2%, the price doubled.
- hollerith 9y ago
  >the current amount that is being held in reserve or as investments --which is almost all of the gold in the world.

SubiculumCode 9y ago

Hardly anyone uses gold as a storage of value.

VarFarYonder 9y ago
> Hardly anyone uses gold as a storage of value https://en.wikipedia.org/wiki/Gold_reserve#Officially_reported_holdings https://en.wikipedia.org/wiki/Gold_reserve#Officially_report...
- SubiculumCode 9y ago
  I meant individuals rarely keep gold as a store of value.
  - hollerith 9y ago
    It is not rare in South Asia.
  - VarFarYonder 9y ago
    > I meant individuals rarely keep gold as a store of value. I think individuals with an actual portfolio of investments will hold gold or have some exposure to gold. Also, you wouldn't expect gold to be widely held when you consider things like Executive Order 6102: https://en.wikipedia.org/wiki/Executive_Order_6102 https://en.wikipedia.org/wiki/Executive_Order_6102 Basically, the US government forced everyone to sell their gold in 1933. US citizens only regained the right to hold gold in 1974. Governments are going to find it much harder to enforce such an order when it comes to cryptocurrencies.