8 ms·
How much gold is there in the world?
- fest 14y agoIt would be nice to see if there is not more gold "sold" to investors than there actually is.
- nostromo 14y agoIf that were the case, we could just declare that gold has been taken off of the gold standard.
- phyalow 14y agoRepo's, gold certificates etc. Good luck getting "your" physical allocation if everyone tried to take delivery of "there" of the underlying assets all at once.
- daniel-cussen 14y agoThis is the original form of a bank run: everybody wants to cash the goldsmiths oversold certificates at the same time.
- fauigerzigerk 14y agoI doubt that is the case in any great quantity. Many investors who buy gold do it because they think it is somehow safer than "paper money". They don't like to buy "paper gold" and that's why the biggest gold ETF (GLD) stores physical gold. That said, there is of course a gold derivatives market. It seems to be rather small according to the survey cited in this article: http://www.ft.com/intl/cms/s/0/eb342ad4-daba-11e0-a58b-00144feabdc0.html http://www.ft.com/intl/cms/s/0/eb342ad4-daba-11e0-a58b-00144... (search for the link in Google to get around the paywall)
- aneth4 14y agoThere most likely is. Even when the USD was on the gold standard, there were far more of these gold claim certificates we called dollars than the US had in gold reserves. This is the nature of fractional reserve banking, and it no doubt still takes place with gold.
- trhtrsh 14y agoBut a key difference is that I have gold in my vault, and you have an oversold "gold" certificate, you can lose, but I can't. When I have a dollar bill in my pocket, and the government floods the country with new dollar debt, my dollar inflates.
- chiph 14y agoMake sure your gold doesn't have a tungsten center. http://www.zerohedge.com/news/2012-09-24/get-your-fake-tungsten-filled-gold-coins-here http://www.zerohedge.com/news/2012-09-24/get-your-fake-tungs... AFAIK, the only way to make certain is via destructive physical inspection (drill a hole in it).
- victorology 14y agoMost interesting point is that gold is being "consumed" for the first time.
- InclinedPlane 14y agoWouldn't burying gold in funeral ceremonies classify as consuming as well?
- fauigerzigerk 14y agoI would say no, because the cost of digging it up again is very low and it's going to happen eventually.
- tragomaskhalos 14y agoOne would hope that this is true in Tutankhamun's case; although we cannot compute how many other priceless archaeological treasures have been melted down for their precious metal content.
- _k 14y agoYou're right, some of it gets lost, but where I live there's a company that recycles all kinds of electronic equipment, circuit boards, mobile phones, .... The company's name is Umicore, they recover the gold at a cost that's cheaper than mining companies can. I can't find a source to back up that claim ( I saw a video ) but they get other precious metals out of it as well, which reduces the cost. Some website even sell Umicore gold bars. Although, I wouldn't recommend that you buy those bars, the price per gram is way too much, imo.
- copyninja 14y agoI think this link backs up your claim on what Umicore does http://www.preciousmetals.umicore.com/PMR/ http://www.preciousmetals.umicore.com/PMR/
- joosters 14y agoAnother quite interesting article on gold - http://www.telegraph.co.uk/culture/qi/8667421/QI-Quite-interesting-facts-about-gold.html http://www.telegraph.co.uk/culture/qi/8667421/QI-Quite-inter... - points out that electronic equipment is actually one of the best sources of gold nowdays. One ton of electronic scrap yields more gold than 17 tons of gold ore.
- ommunist 14y agoI believe the asteroid belt is heavily undermined. With the Soviet 'Energia' rocket system it was within reach.
- ck2 14y agoWhat happens if they come up with a way to make gold in 100 years? Or a way to find/mine it far more easily before then? Since they came up with a way to make perfect diamonds and their value still hasn't gone down, makes you wonder.
- swatkat 14y agoThis comment sums up on why diamond's value hasn't gone down: https://news.ycombinator.com/item?id=5404416 https://news.ycombinator.com/item?id=5404416 So, something similar might happen in the case of gold too.
- MichaelApproved 14y agoPlease CMIIW but I thought "perfect" diamonds were detectable as fake, still expensive and mainly used in industrial environments (grinding wheels).
- yesbabyyes 14y agoRead swatkat's link (sibling comment), then read the story, that comment's parent. It makes a convincing case that the entire diamond market is rigged.
- sambeau 14y agoI suspect gold will prove a lot harder to manufacture than diamonds. Gold is created in the explosion of a large supernova that was formed from the remnants of generations of supernova before, each explosion creating heavier and sometimes totally different elements. All the Silver in the world was formed in a different chain of supernovae to the one that formed all the Gold in the world. (A fact that blows my mind when I think too hard about it.) http://www.world-science.net/othernews/120906_silver.htm http://www.world-science.net/othernews/120906_silver.htm Diamonds need carbon and a fast-moving object to strike it. They are therefore relatively common and relatively easy to make. There is one meteor crater in Russia that contains 3000 years-worth of diamonds (at current consumption rates). It is considered uneconomical to mine for them.
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- justatdotin 14y agoI hate gold. It is a relatively useless metal that comes at great environmental cost, with an over-inflated value driven by war and insecurity.
- daniel-cussen 14y agoIt's also recycling's greatest success story. Think of that. While other resources are consumed, gold isn't, and it's far from useless. It's simply more useful, at the price, at being a store of value.
- masklinn 14y ago> It is a relatively useless metal Historically anyway, it's a very useful metal in the modern world (though its intrinsic value and its market price are completely unrelated)
- vacri 14y agoBy 'relatively useless' do you mean 'historically useful because it was a way to store tokens of wealth in a way that didn't decay/corrode'? And as mentioned already, there's plenty of uses for it in the modern world.
- timedoctor 14y agoThe longer quote from Warren Buffett is very interesting Today the world’s gold stock is about 170,000 metric tons. If all of this gold were melded together, it would form a cube of about 68 feet per side. (Picture it fitting comfortably within a baseball infield.) At $1,750 per ounce – gold’s price as I write this – its value would be $9.6 trillion. Call this cube pile A. Let’s now create a pile B costing an equal amount. For that, we could buy all U.S. cropland (400 million acres with output of about $200 billion annually), plus 16 Exxon Mobils (the world’s most profitable company, one earning more than $40 billion annually). After these purchases, we would have about $1 trillion left over for walking-around money (no sense feeling strapped after this buying binge). Can you imagine an investor with $9.6 trillion selecting pile A over pile B? Beyond the staggering valuation given the existing stock of gold, current prices make today’s annual production of gold command about $160 billion. Buyers – whether jewelry and industrial users, frightened individuals, or speculators – must continually absorb this additional supply to merely maintain an equilibrium at present prices. A century from now the 400 million acres of farmland will have produced staggering amounts of corn, wheat, cotton, and other crops – and will continue to produce that valuable bounty, whatever the currency may be. Exxon Mobil will probably have delivered trillions of dollars in dividends to its owners and will also hold assets worth many more trillions (and, remember, you get 16 Exxons). The 170,000 tons of gold will be unchanged in size and still incapable of producing anything. You can fondle the cube, but it will not respond.
- akandiah 14y ago>At $1,750 per ounce – gold’s price as I write this – its value would be $9.6 trillion Where did you get this price from? It's 1598USD/ounce. I agree with your point. Given its rarity, gold has always been treated by a lot of cultures to be a safe commodity. People will always give you money in return for it - where-ever you go. It doesn't produce or generate anything, but it has been and will always be used as a storage of wealth.
- DavidSJ 14y ago$1,750 was the price when Buffett wrote that.
- digitalengineer 14y agoWhy is gold on the frontpage of HN? Not because of the strenght of gold itself, but because of the weakness of the other actors in this global tragedy; the currencies and the political class governing them. Aks the people of Ireland, Spain, Italy, Greece, Cyprus, Hungary, Vietnam, Iran, Argentina, etc about their faith in their currency and their leaders...
- rmc 14y agoIrish person here. There is no distrust in the currency or banking system. No one's doing a run on the banks here. Ireland was a traditional 19th century bubble
- digitalengineer 14y agoIreland was also a traditional 2007 housing bubble ;-) The way the Cyprus debt was taken care of makes smart people of other indebted country's think twice about their savings. Yahoo News: Big depositors at Cyprus' largest bank may be forced to accept losses of up to 60 percent, far more than initially estimated under the European rescue package to save the country from bankruptcy, officials said Saturday. Deposits of more than 100,000 euros ($128,000) at the Bank of Cyprus will lose 37.5 percent in money that will be converted into bank shares, according to a central bank statement. In a second raid on these accounts, depositors also could lose up to 22.5 percent more, depending on what experts determine is needed to prop up the bank's reserves. The experts will have 90 days to figure that out. The remaining 40 percent of big deposits at the Bank of Cyprus will be "temporarily frozen for liquidity reasons," but continue to accrue existing levels of interest plus another 10 percent, the central bank said. http://news.yahoo.com/bank-cyprus-big-savers-lose-60-percent-135608668--finance.html http://news.yahoo.com/bank-cyprus-big-savers-lose-60-percent... Le Monde: Anything is possible now how much confidence is it possible to have in the single currency and the sacrosanct guarantee of bank deposits when customers of a European bank can wake up to find that part of their savings has disappeared overnight? http://mondediplo.com/2013/04/01nicosia http://mondediplo.com/2013/04/01nicosia I'd say (the loss of) confidence is one of the main reasons there is so much talk about gold.
- DanBC 14y agoI watched a depressing documentary[1] about gold recovery in India. People in a jewellery district would sweep the floor to recover the gold dust. Sometimes gold gets into the drains, so one guy takes a bucket and crawls into the drains to gather sludge, which he then tries to sell to other reclaimers. It's filthy, dangerous, work for little money. Chemicals used are harsh and there's not much protection. And then there are the people recovering electronic components from discarded computers. Cables are gathered in bundles and burned to get rid of the insulation. Burning plastics (on open fires, in the open air, with no worker protections) are nasty. Lack of education and equipment and skills mean the worthwhile bits are not recovered (from PCBs - no copper, gold, lead, etc) and any safety equipment is sold for cash. One of the episodes in [2] is particularly sad. A small boy smashes electrolytic capacitors off a PCB with a rock to try to sell to someone else. It's preferable that young children don't work (UN rights of the child, etc) but if they must work at least give them something that's not utterly pointless. Corruption is rife.[3] And children[4] feel the need to work because they are poor. They're poor because they get paid a tiny amount of money for the work they do. (Don't fucking start with the 'cost of living' bollocks that always crops up on HN. $1.5 per day is a tiny amount of money no matter where you are.) [1] (http://www.bbc.co.uk/programmes/b01n8278 http://www.bbc.co.uk/programmes/b01n8278) [2] (http://www.imdb.com/title/tt1984404/ http://www.imdb.com/title/tt1984404/) [3 (http://www.theatlantic.com/international/print/2012/03/the-warlord-and-the-basketball-star-a-story-of-congos-corrupt-gold-trade/253813/ http://www.theatlantic.com/international/print/2012/03/the-w...) [4] (http://www.irinnews.org/Report/94822/KENYA-Gold-mining-beats-school-any-day http://www.irinnews.org/Report/94822/KENYA-Gold-mining-beats...)
- caf 14y agoThere's a name for that occupation: http://en.wikipedia.org/wiki/Tosher http://en.wikipedia.org/wiki/Tosher
- gutnor 14y agoThe worst thing is that what you describe is a profitable business, even in London. Every jeweller shop gather floor swipes, drain sludge, ... and have them processed (edit: processing is done in the UK, that's normal job for a refiner). The recovery is in the thousands of pounds a month for a small shop. There is an amateur community in the US and UK that recycles gold from all sorts of electronic part for fun and profit. You do not have to have miserable work condition to make a profit recycling gold. The sad thing is how little valuable is human life in India. Another example, they flatten silver into gilding leaf by hand, with a hammer. They frequently break bones and become disabled (and out of work of course). Gilding leaf, especially silver, is cheap (like round wire, flat sheets), as you may imagine the machine that do that in Europe are extremely low tech, reliable and cheap. Yet, in India, it is even cheaper to use human labor to do that. Depressing.