4 ms·

Same is true of, gold, silver, and all those pieces of paper. Money is only valuable if you and everyone else believes in it. Conversely I believe in the US d

by mey 15y ago

Same is true of, gold, silver, and all those pieces of paper. Money is only valuable if you and everyone else believes in it. Conversely I believe in the US dollar, and not bitcoin, for a myriad of reasons. I think that's the real difference between a speculator and investor. The investor believes, the speculator doesn't, and one of them will be right at any given point in time.

adrianwaj 15y ago
Rum and tobacco were also currencies and had unarguable, inherent value across borders, just like bitcoin.
- Pooter 15y ago
  Could you elaborate on what unarguable, inherent value bitcoin has? Tobacco and alcohol at least have direct use value, even if nobody will trade you for them. Bitcoin is useless without it's exchangeability.
jeromec 15y ago
The problem is everything you mentioned except for bitcoin has something backing it up. Gold and silver have thousands of years of history being regarded as valuable backing them up (rare metals with pleasing qualities/applications). And those "pieces of paper" have governments (with guns) backing them up. Unlike bitcoin this makes these items far less likely to have a Wile E. Coyote moment.
- viraptor 15y ago
  Gold and silver situation is a bit weird for me. Sure, it's got some market value in general, but how much is it worth accumulated in a single place? I believe it would be "worth more" distributed between many people. Large parts of the reserve cannot be spent, used, distributed in any significant way. So how much that gold backing part of the system really worth? If we go in the direction of crazy theories - who can assure that the gold backing the system is actually there? ;) You have to believe a lot of the system works correctly, to believe in the value of paper money. Not saying that it's reasonable to suspect otherwise, but at the moment it seems we use money, because the government tells us it's OK to do so and what the value is. Is it really the gold backing anything in that case?
  - jeromec 15y ago
    Sure, it's got some market value in general, but how much is it worth accumulated in a single place? The same as its market value in general. Large parts of the reserve cannot be spent, used, distributed in any significant way. So how much that gold backing part of the system really worth? I believe you're referring to the U.S. gold reserve at Fort Knox? That reserve is worth its value to the owners (U.S. citizens) as an asset. For example, your family might have an expensive set of solid gold and silver cutlery, continually handed down. It's never actually used, and is kept stored away. However, if one generation of your family loses absolutely everything, at least the gold and silver cutlery would be one valuable asset your family could cash in on. Not saying that it's reasonable to suspect otherwise, but at the moment it seems we use money, because the government tells us it's OK to do so and what the value is. Is it really the gold backing anything in that case? President Nixon removed the U.S. dollar convertibility into gold in 1971. It is not gold backing that currently gives the dollar its value.
lwat 15y ago
Gold and silver is useful for other things and will never be worth zero.
- njs12345 15y ago
  Have a look into bitcoin and you'll see it's useful for things that conventional currencies aren't well suited for..

by mey 15y ago

adrianwaj 15y ago

Rum and tobacco were also currencies and had unarguable, inherent value across borders, just like bitcoin.

Pooter 15y ago
Could you elaborate on what unarguable, inherent value bitcoin has? Tobacco and alcohol at least have direct use value, even if nobody will trade you for them. Bitcoin is useless without it's exchangeability.

jeromec 15y ago

The problem is everything you mentioned except for bitcoin has something backing it up. Gold and silver have thousands of years of history being regarded as valuable backing them up (rare metals with pleasing qualities/applications). And those "pieces of paper" have governments (with guns) backing them up. Unlike bitcoin this makes these items far less likely to have a Wile E. Coyote moment.

viraptor 15y ago
Gold and silver situation is a bit weird for me. Sure, it's got some market value in general, but how much is it worth accumulated in a single place? I believe it would be "worth more" distributed between many people. Large parts of the reserve cannot be spent, used, distributed in any significant way. So how much that gold backing part of the system really worth? If we go in the direction of crazy theories - who can assure that the gold backing the system is actually there? ;) You have to believe a lot of the system works correctly, to believe in the value of paper money. Not saying that it's reasonable to suspect otherwise, but at the moment it seems we use money, because the government tells us it's OK to do so and what the value is. Is it really the gold backing anything in that case?
- jeromec 15y ago
  Sure, it's got some market value in general, but how much is it worth accumulated in a single place? The same as its market value in general. Large parts of the reserve cannot be spent, used, distributed in any significant way. So how much that gold backing part of the system really worth? I believe you're referring to the U.S. gold reserve at Fort Knox? That reserve is worth its value to the owners (U.S. citizens) as an asset. For example, your family might have an expensive set of solid gold and silver cutlery, continually handed down. It's never actually used, and is kept stored away. However, if one generation of your family loses absolutely everything, at least the gold and silver cutlery would be one valuable asset your family could cash in on. Not saying that it's reasonable to suspect otherwise, but at the moment it seems we use money, because the government tells us it's OK to do so and what the value is. Is it really the gold backing anything in that case? President Nixon removed the U.S. dollar convertibility into gold in 1971. It is not gold backing that currently gives the dollar its value.

lwat 15y ago

Gold and silver is useful for other things and will never be worth zero.

njs12345 15y ago
Have a look into bitcoin and you'll see it's useful for things that conventional currencies aren't well suited for..