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Seems like the other way around to me. Most oil gets used pretty quickly after it’s produced. Most gold sits in vaults doing absolutely nothing.

dahfizz 7y ago
Sitting in vaults is what gold does. It's being "used" as a store of value. Just because it isn't being burnt up doesn't mean it's providing no utility.
- mikeash 7y ago
  No particular quantity is needed to fulfill that function. If the gold supply were half as big, then each bit would store twice as much value and nothing would change other than the vaults being smaller. We have way more gold than is needed to do what it’s used for.
  - dahfizz 7y ago
    You're being reductive. If supply is the only thing that matters, then why has the price of gold continued to rise even though we mine thousands of tons each year?
    - mikeash 7y ago
      Saying that there’s a glut of oil and a dearth of gold based on their prices is pretty reductive too. It’s a simple thought experiment: what would the world look like if there were twice as much X, or half as much X, than there actually is? For X=oil, there would be profound changes. Half as much would require a totally different looking economy. Twice as much would enable big changes. For X=oil, nothing much changes. The industrial and decorative uses continue as they do now. The “store of wealth” uses just have a ~2x difference in $/kg compared to now. Why does the price of gold continue to rise? Because enough people think they’ll be able to sell it for a good price later.
Fjolsvith 7y ago
The top 15 countries with the largest oil reserves together have over 1.5 trillion barrels of oil remaining. There's more in the remaining countries. [1] Edit: Annual world consumption of oil is about 100 million, so we have about 15000 years of reserves left. [2] That seems to me to be a glut. 1. https://www.visualcapitalist.com/map-countries-most-oil-reserves/ https://www.visualcapitalist.com/map-countries-most-oil-rese... 2. https://ycharts.com/indicators/world_oil_consumption https://ycharts.com/indicators/world_oil_consumption
- mikeash 7y ago
  According to your links, worldwide consumption of oil is 100 million per day. That’s 40 years of supply if consumption stays steady. How long will current gold reserves last?
  - Fjolsvith 7y ago
    Look again: "World Oil Consumption measures the number of barrels that are consumed worldwide on an annual basis. It is an indicator released by BP. This metric tends to trend upwards except for a small dip in the 1980s and 2010. Interestingly enough, 2010 was also the time that Crude Oil prices plummeted because of supply and demand concerns." 15000 years. GLUT.
    - mikeash 7y ago
      “World Oil Consumption:99.84M bbl/d for 2018“ That /d means “per day.” Your other link has the same figure. Or search “world oil consumption” and find a bazillion other sources all saying it’s per day. This doesn’t even pass a basic smell test. That’s about 3 billion gallons. That’s about 10 gallons per American with the rest of the world getting nothing. Do you really think worldwide oil consumption is 10 gallons per American per year? The average American driver drives twelve thousand miles a year!
      - Fjolsvith 7y ago
        Ah, you are correct with the daily usage amount. I figure in about 10-15 years, that will drop to maybe 1/4 of the daily use with the solar->battery->car upgrade that society will engage in. So, I'd stretch it out quite a bit further than 40 years.

dahfizz 7y ago

Sitting in vaults is what gold does. It's being "used" as a store of value. Just because it isn't being burnt up doesn't mean it's providing no utility.

mikeash 7y ago
No particular quantity is needed to fulfill that function. If the gold supply were half as big, then each bit would store twice as much value and nothing would change other than the vaults being smaller. We have way more gold than is needed to do what it’s used for.
- dahfizz 7y ago
  You're being reductive. If supply is the only thing that matters, then why has the price of gold continued to rise even though we mine thousands of tons each year?
  - mikeash 7y ago
    Saying that there’s a glut of oil and a dearth of gold based on their prices is pretty reductive too. It’s a simple thought experiment: what would the world look like if there were twice as much X, or half as much X, than there actually is? For X=oil, there would be profound changes. Half as much would require a totally different looking economy. Twice as much would enable big changes. For X=oil, nothing much changes. The industrial and decorative uses continue as they do now. The “store of wealth” uses just have a ~2x difference in $/kg compared to now. Why does the price of gold continue to rise? Because enough people think they’ll be able to sell it for a good price later.

Fjolsvith 7y ago

The top 15 countries with the largest oil reserves together have over 1.5 trillion barrels of oil remaining. There's more in the remaining countries. [1] Edit: Annual world consumption of oil is about 100 million, so we have about 15000 years of reserves left. [2] That seems to me to be a glut. 1. https://www.visualcapitalist.com/map-countries-most-oil-reserves/ https://www.visualcapitalist.com/map-countries-most-oil-rese... 2. https://ycharts.com/indicators/world_oil_consumption https://ycharts.com/indicators/world_oil_consumption

mikeash 7y ago
According to your links, worldwide consumption of oil is 100 million per day. That’s 40 years of supply if consumption stays steady. How long will current gold reserves last?
- Fjolsvith 7y ago
  Look again: "World Oil Consumption measures the number of barrels that are consumed worldwide on an annual basis. It is an indicator released by BP. This metric tends to trend upwards except for a small dip in the 1980s and 2010. Interestingly enough, 2010 was also the time that Crude Oil prices plummeted because of supply and demand concerns." 15000 years. GLUT.
  - mikeash 7y ago
    “World Oil Consumption:99.84M bbl/d for 2018“ That /d means “per day.” Your other link has the same figure. Or search “world oil consumption” and find a bazillion other sources all saying it’s per day. This doesn’t even pass a basic smell test. That’s about 3 billion gallons. That’s about 10 gallons per American with the rest of the world getting nothing. Do you really think worldwide oil consumption is 10 gallons per American per year? The average American driver drives twelve thousand miles a year!
    - Fjolsvith 7y ago
      Ah, you are correct with the daily usage amount. I figure in about 10-15 years, that will drop to maybe 1/4 of the daily use with the solar->battery->car upgrade that society will engage in. So, I'd stretch it out quite a bit further than 40 years.