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G20 summit - does it make sense to start buying gold NOW?! (pg. 3)
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| Lebezniatnikov |
| quote: | Originally posted by Krypton
As a medium of economic exchange? In the event that a currency would collapse, or become extremely diluted in value, any commodities priced in that currency will see a proportional rise, if not exponential, in the value of that commodity. So the price of food, energy, metals, and commodities in general would sky rocket. I buy gold/silver because it's simply easy to store and is a perfect back stop in case of economic collapse. |
What gives gold or silver this magical value? They don't do anything - the fact that they have any value at all is based only on a social construction. If the world ends like you suggest, bet your gold on the fact that people will be bartering for wool with apples. |
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| Lebezniatnikov |
| quote: | Originally posted by Capitalizt
If the apocalypse did come and I had a plentiful store of food, I would gladly trade some of my reserves for a few ounces of gold...but wouldn't give you anything for a bunch of little paper rectangles. |
Why? That doesn't make any sense. Why would anyone in their right mind value your gold? |
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| jerZ07002 |
| quote: | Originally posted by Capitalizt
If the apocalypse did come and I had a plentiful store of food, I would gladly trade some of my reserves for a few ounces of gold...but wouldn't give you anything for a bunch of little paper rectangles. |
really? if the world was in a dire situation you would trade food for a metal that would just sit on your table and look pretty? that's just dumb! |
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| Krypton |
| quote: | Originally posted by jerZ07002
The price of those commodities aren't solely dependent on the value of a dollar. If something really serious went down people wouldn't give a about holding onto a piece of gold, which doesn't feed, shelter, or secure a family. People will want food, safe shelter, water, and security. Gold does for people. Gold only provides a back stop when the deflated value is caused by text book economic problems. The only benefit a gold nugget would provide in apocalyptic situation would be the ability to throw it at someone trying to rob you of your food. |
The dollar drops 90% in value because of some calamity. Are you telling me the price of commodities wouldn't skyrocket?:rolleyes:
| quote: | | What gives gold or silver this magical value? They don't do anything - the fact that they have any value at all is based only on a social construction. If the world ends like you suggest, bet your gold on the fact that people will be bartering for wool with apples. |
The dollar drops 90% in value because of some calamity. Are you telling me the price of commodities wouldn't skyrocket?:rolleyes: |
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| jerZ07002 |
| quote: | Originally posted by Krypton
The dollar drops 90% in value because of some calamity. Are you telling me the price of commodities wouldn't skyrocket?:rolleyes:
The dollar drops 90% in value because of some calamity. Are you telling me the price of commodities wouldn't skyrocket?:rolleyes: |
i'm saying people don't give a about gold when they don't have food, water, shelter, or security. i don't understand why that is difficult for you to understand. It's actually rather simple. Imagine if you were walking in a desert trying to find your way back to civilization. Would gold be on your list of necessities? I'm willing to bet it's not even close. |
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| pkcRAISTLIN |
| i might add that a 90% reduction in the value of your currency would almost assuredly come from some pretty serious worldwide calamity, and as such no, i dont think the cost of commodities would 'skyrocket' because nobody will be trading anything in this environment (at least not on the stock exchange). so its a little disingenuous to posit the 90% reduction whilst maintaining that everything else in market terms would remain the same. |
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| Krypton |
| quote: | Originally posted by jerZ07002
i'm saying people don't give a about gold when they don't have food, water, shelter, or security. i don't understand why that is difficult for you to understand. It's actually rather simple. Imagine if you were walking in a desert trying to find your way back to civilization. Would gold be on your list of necessities? I'm willing to bet it's not even close. |
As a medium of exchange, it would be high on my list. |
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| Krypton |
| quote: | Originally posted by pkcRAISTLIN
i might add that a 90% reduction in the value of your currency would almost assuredly come from some pretty serious worldwide calamity, and as such no, i dont think the cost of commodities would 'skyrocket' because nobody will be trading anything in this environment (at least not on the stock exchange). so its a little disingenuous to posit the 90% reduction whilst maintaining that everything else in market terms would remain the same. |
I'm going on the theory that a commodity priced in a declining currency will proportionally rise in value. |
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| jerZ07002 |
| quote: | Originally posted by Krypton
As a medium of exchange, it would be high on my list. |
this has become hopeless. Metals will have no value in an catastrophic event that causes a huge devaluing of currencies because everyone will be solely concerned with basic human needs. The only thing that could really cause world currencies to all collapse would be a worldwide food shortage or shortage of other basic needs. |
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| jerZ07002 |
| quote: | Originally posted by Krypton
I'm going on the theory that a commodity priced in a declining currency will proportionally rise in value. |
you're theory is flawed because it ignores other factors that determine its price. |
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| Krypton |
| Well, obviously we have fundamental differences in views on the nature of commodity pricing. We'll leave it at that...:) |
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| jerZ07002 |
| quote: | Originally posted by Krypton
Well, obviously we have fundamental differences in views on the nature of commodity pricing. We'll leave it at that...:) |
in that case, you have a fundamental difference with anyone with basic understanding of commodities pricing. There must be an underlying desire for the actual commodity. The value of a currency is only a driver to the extent the commodity is still in demand. |
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