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Gold doesn't do anything Gold is a store of value. Stores of value provide a useful function in society. Very few things actually qualify as stores of value, a
by riffer 16y ago
Gold doesn't do anything
Gold is a store of value. Stores of value provide a useful function in society. Very few things actually qualify as stores of value, and gold is the most known of them so I used that, but you could replace the string 'gold' with 'store of value' in my argument without changing the substance of my argument.
- cynicalkane 16y ago"Store of value" is the technically correct term, I suppose, but it's a misleading term because it doesn't actually store any value. The term "store of value" actually refers to currency, except civilization outgrew using cumbersome lumps of shiny metal to conduct its transactions.
- gills 16y agoGold is a speculative device. Humans hold the future value one might hope to trade the gold for.
- nostrademons 16y agoSo are dollar bills. In some situations like prisons, so are cigarettes. Something is a store of value because you expect that other people will value it as highly in the future as they do now. (Or at least some predictable fraction less, accounting for inflation.) Whether it's gold or dollars, it's still based on investor psychology, and is still just as subject to whims of herd behavior. Ask people who bought gold in 1979 how well it stored its value.