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That is one theory, and is the prevailing one. It is not necessarily correct. Regardless, it is certainly a consumer's right to store their assets in something
by aneth4 14y ago
That is one theory, and is the prevailing one. It is not necessarily correct.
Regardless, it is certainly a consumer's right to store their assets in something that is not inflationary, as most do. Is the population holding empty real estate or gold instead of currency really that much better for the economy? No.
Smart money will simply shift out of cash in an inflationary environment, and the value will not necessarily be productively invested.
An opposing viewpoint more thoroughly articulated:
http://mises.org/daily/4618 http://mises.org/daily/4618
- betterunix 14y ago"Is the population holding empty real estate or gold instead of currency really that much better for the economy? No." A population holding productive factories, tools, and land is a whole lot better for the economy than people hoarding gold.
- SilasX 14y agoAnd a population withholding investment capital when those (actually very heterogeneous) tools when they're for unsustainable business plans is better than one in which people have to invest in some business plan to preserve what they have. It's really not as simple as "investment = good". It's good when it's for stuff that produces value. It's not good when it's invested for the sake of investing and ends up in the stocks of corrupt corporations and shady ventures.
- dragontamer 14y agoGold is a piss poor investment. Owning Real Estate (and making money off of it) entails taking care of it. People taking care of their land (so that it can appreciate in value) is a good thing. The typical Real Estate "investor" adds a ton of value to their home, not just through maintenance, but also additions (ie: a new deck). This maintenance is true value added to the economy. True value that wouldn't have been added if the investor just left his cash in something else. No one wants to buy a 30-year old home that had no maintenance on it. Unless you're a fan of buying homes with leaky roofs and a flooded basement...
- aneth4 14y ago> Gold is a piss poor investment. Relative to what? The USD? http://pricedingold.com/us-dollar/ http://pricedingold.com/us-dollar/ Real estate? http://pragcap.com/real-estate-gold-ratio-falls-to-30-year-low http://pragcap.com/real-estate-gold-ratio-falls-to-30-year-l... Gold is an asset that holds its purchasing power pretty well. It is what it is. It is not however a "piss poor" investment.
- dragontamer 14y agoUSD is a worse investment, and it seems like Real Estate is not much better than Gold :-p Stocks as investment: http://www.macrotrends.org/1378/dow-to-gold-ratio-100-year-historical-chart http://www.macrotrends.org/1378/dow-to-gold-ratio-100-year-h... And of course, ycombinator. You know... the angel fund / venture capitalist firm that runs this website? We're all here because of investors investing into technology. They do so because they believe they can ultimately make money with technology investments. At least, more so than Gold, Real Estate, or even Stocks.
- lclarkmichalek 14y agoYou know, comparing a commodity against a currency isn't very sensible. I don't know many (sensible) people who say "I'm just going to keep a load of dollar bills under my bed" when it comes to investing (which is what your first link compares to gold).
- 14y ago
- deleted 14y ago[deleted]