IS Gold Money?

"don't be deluded into thinking it has some magical power, or is worth something that it is not."

It's worth 1380 an ounce and is very liquid.

"And gold does not earn "income," because increases or decreases in the price of an asset are not counted as income, but rather as capital gains."

And neither does the paper US dollar.

"Much of the increase in the price of gold was probably due to the introduction of gold ETF's, and George Soros buying tons of the stuff."

Lol, gold been going up and up and up for 12 straight years even before the introduction of ETF's
In fact gold went from 250 an ounce in 2000 to well over 400 bucks an ounce in 204 prior to the ETF introduction.

there is a strong point of view that can be made that gold is BETTER than money.......with all due respect to warren buffet.

meant 2004

are bitcoins money? hint: Netherlands, tulips, 1600's......

By printing dollars on a machine at a rate of 65 billion a month one has to ask is the dollar going to be money? tulips 1600 yeah you get the idea.

"neither does the paper US dollar."

Interest is income, renter.

"It's worth 1380 an ounce and is very liquid."

That doesn't make it magical, or money. Platinum is worth $1450 an ounce; oil $96.61 a barrel; and a quart of milk around $1.99. They're not money, either.

"gold been going up and up and up for 12 straight years"

Actually no. Adjusted for inflation, gold at $615 in 1980 would be worth $1,688 in 2012. It currently sells for $1,379, so it hasn't even kept up.

http://www.nma.org/pdf/gold/his_gold_prices.pdf
http://www.westegg.com/inflation/infl.cgi

The S&P 500, without dividend reinvestment, has gone up 400% since 1980.

http://www.multpl.com/s-p-500-price/table

from $331 to $1633 today - the $331 being in constant April 2013 dollars.

You pick your investment, I'll pick mine.

renter, trying to help you here a bit just so that you know. there are common charactoristics of all three but also distinct differences. you are getting lost in stevejhx's smokescreen.

stevie, gold and bitcoins the same to you?

*characteristics

"Interest is income, renter."

Once again gold is not an investment stevejhx. It's a form of currency. So dollar doesn't
earn interest neither does a gold coin or a bar.

"Actually no. Adjusted for inflation, gold at $615 in 1980 would be worth $1,688 in 2012. It currently sells for $1,379, so it hasn't even kept up."

So if you bought a 1000 ounces in the year 2000 at 250 an ounce it would of cost you 250K and in 2013 it would be worth 1,380,000. That's a 13% annual return. Much higher than inflation.

The S and P in 2007 was at 1557 and today it's only at 1630 that's an annual return of less than 2% Yet gold went from 400 and ounce to over 1300 an ounce that's a 25% annual return

You pick your time frames and I'll pick mine.

Thanks for clarifying that ranger.

"Once again gold is not an investment stevejhx. It's a form of currency."

No it's not. Not anywhere on the planet, in any form.

"So dollar doesn't earn interest neither does a gold coin or a bar."

I'll let you think about that for a while.

"The S and P in 2007 was at 1557 and today it's only at 1630 that's an annual return of less than 2%"

No, because you didn't include dividends.

"You pick your time frames and I'll pick mine."

Indeed.

The problem with gold, renter, is that it's essentially a Ponzi scheme: since it has virtually no industrial applications because it is inert, and nowhere on the face of the earth is it accepted as a currency, buying and selling it boils down to convincing the next guy to pay more for it than you did. Unlike stocks, for instance, it does not represent a future flow of income. Unlike bonds, it does not represent debt to be paid back in a currency. Unlike commodities it is not used in any industrial process that would give it a market value as an input or consumable.

So it sits there. It's very pretty, to be sure, and handy as jewelry because it doesn't rust, and nice as fillings because it's soft and doesn't crack, but it has no other real use. Silver and platinum are used in industry; other inert materials such as quartz can be used as building materials. Quarts can be used as a crystal to measure vibrations (and hence time). Helium is inert but it floats in the air, and has other properties that make it useful in industrial processes.

Gold is a good conductor, but silver is better and copper is a lot better.

The fact is, gold isn't used for anything except jewelry, and it's not money. Its only value is what you can convince the next guy to pay for it.

"....The S and P in 2007 was at 1557 and today it's only at 1630 that's an annual return of less..."

Embarrassing. You forgot to include dividends.

FYI, the S&P has returned 4.56% a year with dividends since 1-1-2007. And since 1980, 11.52% a year. Gold has returned...3.03% per year since 1980.

golds a long term short in my opinion

stevejhx, that "logic" is full of holes. what youre missing in your "getting the next guy to pay more for it than you did" is the intrinsic value of gold going back through the ages...

you say it has no industrial use EXCEPT for jewelry yet entire civilizations were built on accumulating this asset and it has withstood the test of time for centuries. its a finite resource (like nyc real estate, hahahahaaha). your logic is flawed in many ways, one can wallpaper your condo in FL many times over with valueless paper certificates from "blue chip" companies with "predictable" irrs and cashflows that are now worth ZERO. does GM subordinated debt ring a bell to you to cite a recent example? many other investment grade bonds that completely went into the shitter. let alone the myriad of stocks that are completely worthless now compared to the luster on gold that comes into appeal again and again over time. I don't recall any investment cycle where gold went completely belly up compared to your bond and equity analysis.

I am no gold bull by any means, but your position is quite flawed. depending on your definition of money, gold certainly meets that criteria in many instances and can compare quite favorably as well as an asset class to stocks and bonds very broadly. I will repeat my question, are bitcoins money? think about that one for awhile and you and Jason can come back with your cut and paste bs reference posts......

>you say it has no industrial use EXCEPT for jewelry

What's wrong with jewelry?

>FYI, the S&P has returned 4.56% a year with dividends since 1-1-2007. And since 1980, 11.52% a year. Gold has returned...3.03% per year since 1980.

Does anyone really make the case that the S&P500 is a similar asset class as gold? Is it stupid to save money in a CD because the S&P500 has outperformed bank deposits? Why do banks even lend money if they can just invest it in the S&P500?

Nothing's wrong with jewelry. There's just not an enormous demand for it.

The S&P on average returns 11% per year, reinvesting dividends, since 1945. We've been in a secular bear market since 2000. Some say we're returning to a secular bull.

I don't know. Nobody will, till it's over.

Commercial banks aren't allowed to hold stock, though investment banks can. That's why they don't invest in the S&P. There are a lot of restrictions on what banks can own, and on what institutions can own banks.

RF: "is the intrinsic value of gold going back through the ages..."

Well good. Oyster shells used to have "intrinsic value," too. 2000 years ago people did not have a good theoretical framework of what money is and how it works. Fortunately, that's changed.

You can judge the price of a stock, essentially, on the price/earnings ratio. You can judge the price of a bond by interest rates and whether or not they are callable. You can judge the price of a final product based on the marginal cost of production and return on capital. You can judge the price of a commodity based on its demand as an input to a final product.

None of that is true for gold, because the demand is all psychological. There is no "need" for it. Whether the Romans liked it or not is immaterial; they also liked feeding people to the lions.

My logic isn't flawed - yours is. Companies do go bust, and their stock and bonds are sometimes worth nothing. But they're worth nothing because the companies no longer make products profitably. In other words, Polaroid and Kodak were at one time worth a lot because their products were; their products no longer are because they're not in demand.

There is no demand for gold other than a psychological one. Yes you can make an argument that nobody needs photographs, either, so the demand for photographs is psychological, too. But the difference is that Polaroid and Kodak at one time produced a stream of income. Gold never does. Silver does - either in catalytic converters or once upon a time in photographic film or in self-tinting eyeglasses, or whatever.

Gold has none of those uses. That is a key difference. Earthworms have more intrinsic value than gold - you can use them as bait, and push comes to shove, you can eat them. You can't eat gold, and you can't spend it. All you can do is wear it, and look at it.

Why are you goldcist?

Since 2000 gold has averaged a 13% return much better than the S & P

"There is no demand for gold other than a psychological one."

Steve tell that to the central Banks for they keep buying Gold

"Central Banks Boosted Gold Holdings in April "

http://online.wsj.com/article/SB10001424127887323855804578508223601870406.html

so you don't like gold, but your logic does not hold true on its value from a historical perspective. youre citing metrics in your polaroid and kodak examples which is a merely a blip on a chart from a historical perspective.

i repeat, there are tons of examples where stocks that have been measured by pe multiples and bonds measured by interest coverage ratios that have turned to crap overnight. not only by failing to meet profit margins or missing on the next product rage, but for lots of other reasons as well. and poof, they are gone and so is your investment.

gold isnt only a shiny nice looking metal, it has deeper value that you seemingly can't contemplate and moreover has been used as "currency" throughout the ages. the original post "is gold money" is a good question. as i have said, there is a strong argument that gold is BETTER than money. its relation to stocks and bonds is a completely different issue unless you want to debate portfolio construction.

and you still havent answered, are bitcoins money?

OYSTER SHELLS???!!!! isnt that from a flintstones episode??? oyster shells......

"Steve tell that to the central Banks for they keep buying Gold"

We've already discussed this, renter: central bank holdings of gold are less than 1/10 of 1% of their balance sheets. Not even material.

"there are tons of examples where stocks that have been measured by pe multiples and bonds measured by interest coverage ratios that have turned to crap overnight"

There are indeed - but the reason they have done so is not the same reason why gold has done so (and it has).

"there is a strong argument that gold is BETTER than money."

There is no such argument. Money is not the same thing as gold. Money is primarily an accounting measure. Gold is not.

>Money is primarily an accounting measure.

well, if you put it that way, I'm no longer interested.

can you please cut and paste a post that central banks are now buying oyster shells as well???

money is a way of paying for goods and services, issued by central banks and sovereign governments. gold is not "issued" by any bank nor by any government (absent the gold standard once utilized by certain governments).

you think someone from the south would rather have gold than confederate dollars with hindsight? do we need to go around the world, currency by currency to give you additional examples of money becoming completely worthless or near worthless due to hyper-inflation, corrupt regimes or other examples where the population turned and fell back to hard commodities and gold as a way to preserve wealth? do you think these people would conclude that gold was and is indeed better than money?

and pls give me an example when gold has gone to zero.

and by the way, to take a more recent example - you think banks paying a NEGATIVE return to safekeep currency still supports your interest bearing income statement.

The Treasury sure owns a lot of oyster shells steve.

Department of the Treasury
Financial Management Service
STATUS REPORT OF U.S. TREASURY-OWNED GOLD
May 31, 2013
Summary Fine Troy Ounces Book Value

Gold Bullion 258,641,878.074 $10,920,429,098.79
Gold Coins, Blanks, Miscellaneous 2,857,048.173 120,630,859.37

Total 261,498,926.247 11,041,059,958.1

Renterjoey - that is under $261MM our of a 3.2 TRILLION balance sheet. Fail.

that in ounces genius

You can learn all about the gold standard here, renter, and how much it doesn't work (by an expert):

http://www.federalreserve.gov/boarddocs/speeches/2004/200403022/default.htm

And here is what the Federal Reserve uses as collateral:

http://www.federalreserve.gov/faqs/currency_12770.htm

Note that gold is not mentioned.

" do we need to go around the world, currency by currency to give you additional examples of money becoming completely worthless or near worthless due to hyper-inflation, corrupt regimes or other examples where the population turned and fell back to hard commodities and gold as a way to preserve wealth? do you think these people would conclude that gold was and is indeed better than money?"

No. They would have preferred to have a properly managed currency.

Note that there was hyperinflation can also occur under the gold standard, and it did. It can occur whenever there is a fractional reserve system, which is necessary for economic growth. Otherwise, the money supply is fixed, and what one person earns must be taken away from another person: it is a zero-sum game.

But you miss the other side of the gold argument, as well: deflation, which is far more dangerous than inflation. The very reason that the gold standard doesn't work is that there is no way to increase the money supply during a recession, which is why they tend to spiral down into a depression.

The gold standard was dropped in the Great Depression; the deflation caused during it led to the rise of the fascist powers in Germany, Italy, Spain, and Japan. Inflation is a problem that is relatively easily fixed; deflation is not. The inflation of the Weimar Republic was short-lived and easily fixed; the deflation in the Great Depression led to Hitler.

Which do you prefer?

Gold has NEVER failed as a store of value (money) since the beginning of time.

Ask the Romans, China, France, Germany, etc. about their history of failed paper currencies.

If Gold was worthless like EVERY central bankers tell us, then WHY THE FOCK do they hold millions of tons of them in their reserves?

"that in ounces genius"

My mistake. But that has to include Gold the Fed is holding for other nations - i.e. most of it is not owned by the Fed. The Fed publishes its balance sheet every week, and gold is NOT a large holding at all. The NY Fed says "Nearly 98% of the gold at the Federal Reserve Bank of New York is owned by the central banks of foreign nations"
So certainly not $400B worth.

The Romans didn't have paper money, and their empire failed.

The Chinese invented paper money, and their empire failed, too.

Gold has a value - so does peat moss. Central banks do hold some - not much - gold, most of which they accumulated while we were on the gold standard, except for some developing countries that don't have their own readily accepted currencies and so might need to pay debts with something that has no other value, and stores well. Grain tends to explode, and most other metals rust, and have industrial uses.

As I've said, and Jason repeats, the government's holdings of good are miniscule compared to everything else it holds. It has strategic petroleum reserves, too - so why not measure everything in terms of an ounce of crude oil?

Same thing. Black gold, remember? Texas-T....

Salt

"Gold has a value - so does peat moss"

Yes, but peat moss has never withstand time.

"The Romans didn't have paper money,"

Technically no, it wasn't paper but same 'fiat' concept.
The Denarius started out as 94% silver but around the time of Rome’s collapse, the denarius contained only 0.02% silver and virtually nobody accepted it as a medium of exchange or a store of value.

"Central banks do hold some - not much - gold, most of which they accumulated while we were on the gold standard"

Odd how the TOP 10 holders of gold are all central bankers. So the folks telling you that gold is useless are the top holders and also locking it up in "maximum" security.

United States: 8,133.5 tonnes, 75.7 percent
Germany: 3,391.3 tonnes, 72.8 percent
IMF: 2,814 tonnes
Italy: 2,451.8 tonnes, 72.1 percent
France: 2,435.4 tonnes, 70.5 percent
China: 1,054.1 tonnes, 1.7 percent
Switzerland: 1,040.1 tonnes, 10.6 percent
Russia: 957.8 tonnes, 9.5 percent
Japan: 765.2 tonnes, 3.2 percent
Netherlands: 612.5 tonnes, 59.7 percent

China will triple their reserve in the coming years. I believe in five years China will become the largest owner of Gold.
They continue buying gold as thhey watch us spend money we don't have and continue printing paper dollars to keep interest rates low so we don't have an economic collapse.
Get ready for the yuan or renminbi as an alternative global reserve currency. China wants to make that happen and large gold reserves are essential if this is to be achieved.

"Odd how the TOP 10 holders of gold are all central bankers"

Yes but you're looking at it bass-ackwards. The way to look at it is what percentage of central banks' holdings are in gold, not what percentage of gold central banks hold. The former percentage is infinitesimal; the latter is because many of those gold holdings go back centuries.

Renter, you need to study the Chinese economic model before you go spewing nonsense. Because of their export-driven economy based on an undervalued currency, they are stuck with massive amounts of hard currencies (dollars and euros). They have to spend those dollars and euros on something to keep their currency rate low. So they buy something without any industrial or other purpose, and gold fits the bill. It wouldn't make sense to buy copper because it can be used in industry; ditto just about anything else. That's why they pick gold.

They do NOT use gold as a currency.

Renter, you are of the mistaken impression that money has to be 'worth' something; that in and of itself it must have an intrinsic value. It doesn't. Paper (linen, actually) works fine - all it does is provide an easy mechanism by which prices can be set, which enables people to buy and sell things without having to barter. So if you want a lamb chop you can buy one without having to exchange something for the whole sheep; if you want feta cheese you can buy it without having to milk a goat.

Read the Bible; thousands of years ago there was money, but people bought and sold things in their worth in animals. We don't do that anymore.

Gold is not money. That people are willing to pay a lot of money for it is partially due to its value for jewelry and its relative scarcity, but also for historic, psychological reasons. It is not necessary, and in case of an "economic collapse" earthworms or crickets will be worth more, because you can eat them.

If it weren't for our current form of money we could not have the type of civilization that we do, because there would be no effective price mechanism by which everything can be bought and sold, including gold. Money does not have to be "worth" something, because gold is not "worth" anything more than what you say it is.

Back in the day people had a similar conception of time - that there was something inherent to time that made it special. Read the history of when Pope Gregory changed the calendar, and the near revolution it caused. Read the history of when we went to a uniform time system in this country (and in Europe), without which the trains couldn't run on time. People went crazy - they thought time was set by God.

It's not. And neither is the value of gold. It is NOT money, and it doesn't matter if money is backed by it, except that when it is, it causes more problems than it's worth.

And no, the Chinese will not have a reserve currency anytime soon because no one trusts the stability of their government.

again, your logic is full of holes. in the case of economic collapse do you think paper currency will be worth more than earthworms or crickets? maybe has some value if you pile it up and set it on fire to keep warm. moreover, in times of economic collapse, people have again and again turned to hard commodities and gold as a way to preserve wealth and have goods to barter for substinance and acquiring other assets.

if you think the chinese are hoarding gold because it has no "industrial value" you are delusional. they are hoarding it and other hard assets (oil, precious metals, and other commodities) so they have hard assets to satiate the internal growth of their economy and all the associated demands by their populace as a result of that growth. their investment in us demonitated instruments is a way to validate the capitalist system that we have perfected and a subtle yet influential way to sway policy based on their holdings. they are buyesrs of gold to hedge against that strategy and they know that is the best way to play that hedge, not because it doesnt have any industrial utility. to suggest otherwise is just bonkers.

i happen to support our economic system and our monetary policy (although the current gvmt approach is definitely putting this system in peril) but to suggest gold does not have any monetary utility is incorrect, despite what bernanke and buffet have espoused. and you finally have acknowledged its intrinsic value that has been validated since civilized societies have evolved yet you continue to suggest its only value is because its a nice alloy for jewlery. talk about missing the forrest for the trees......

But we already established that the Fed does not in fact OWN 98% of the gold it holds. Its LITERALLY being a bank. Storing the money. The Fed does not OWN all that gold, just like Chase does not OWN the money you deposit there.

>the gold it holds. Its LITERALLY being a bank. Storing the money.

So gold is money.

se, why?

It may have value but it can not easily be traded for goods and services. It is not currency.

"in the case of economic collapse do you think paper currency will be worth more than earthworms or crickets?"

Yes.

"they are hoarding it and other hard assets (oil, precious metals, and other commodities) so they have hard assets to satiate the internal growth of their economy"

They are not "hoarding" those things; they are consuming them. There is nothing to consumer gold on. My logic is fine; yours is faulty.

"their investment in us demonitated instruments is a way to validate the capitalist system that we have perfected"

No. It's necessary for them to maintain their below-market exchange rate. That is a well-known fact.

"they know that is the best way to play that hedge, not because it doesnt have any industrial utility"

No. There is no "hedge"; they simply must spend dollars on something to manage their exchange rate and currency reserves. Here is the what and why:

http://www.bbc.co.uk/news/business-22567974

Its total holdings of gold are less than 2% of its reserves:

http://www.bloomberg.com/news/2013-03-13/china-may-limit-gold-to-2-of-foreign-reserves-pboc-s-yi-says.html

Here is a graph that shows Asian central bank assets:

http://www.bis.org/publ/qtrpdf/r_qt1206g.pdf

and gold in China isn't rising as a percent.

"and you finally have acknowledged its intrinsic value"

Anything that has a market has an "intrinsic value"; my point is that the market for gold is based on a fantasy - that it is somehow magical money or has other magical powers that "fiat currencies" do not.

It isn't magical money, and it has no other magical powers that "fiat currencies" do not.

But obviously I'm talking to someone who has never taken a course in economics, never mind money and banking.

Gold has a market value, just like sand and feathers do.

>Anything that has a market has an "intrinsic value"; my point is that the market for gold is based on a fantasy - that it is somehow magical money or has other magical powers that "fiat currencies" do not.

What is the meaning of life? Is there a god? What happens when we die?

stevie, try and get past your economics 101 course as hard as that may be for you. I can go back on this point by point but not worth it. but if you think the Chinese buying gold is simply a way to spend their dollars and manage the exchange rate, then you are exactly proving my point. they are not buying oyster shells, sand dollars, feathers, earthworms, crickets, tree saplings, helium, warhol paintings, or other innate objects to offset currency risk. they are buying GOLD. and they are most certainly buying it as a hedge.

as I said, I am no gold bull - don't own much of it. but your logic is indeed flawed, gold's intrinsic value is the part you cannot seem to comprehend. there has been and will continue to be a market for it - the market is deep, liquid, and has correlations to other asset classes that can be just as predictable as your equity and bond analysis. you just happen to thumb your nose at it because its too abstract an asset to fit into your slide rule. i wouldn't invest in it either but to suggest its has no potential monetary utility is to ignore present day and past history.

ar, never said it was currency but it has provided a similar utility throughout the ages.

and stevie, pls help me understand eco 101...are bitcoins money? u still haven't answered....your "economic" prowess is from a couple of antiquated textbooks, Wikipedia, and whatever bs reference post you can plaster to the wall. you are out of your element, stick to paralegal work...

you can look them up on Wikipedia and spew an answer.....

"they are not buying oyster shells, sand dollars, feathers, earthworms, crickets, tree saplings, helium, warhol paintings, or other innate objects to offset currency risk"

I never said they were doing anything to "offset currency risk"; if they wanted to do that they would buy a swap. They are doing it to MANAGE their currency price because they need to get rid of dollars. Cina holds $4.5 TRILLION dollars in US government debt

http://usgovinfo.about.com/od/moneymatters/ss/How-Much-US-Debt-Does-China-Own.htm

far more than what they hold in gold.

"gold's intrinsic value is the part you cannot seem to comprehend."

Untrue. What is said is that there is no way to determine what gold is worth based on anything other than psychology, since there is no demand for it for anything income-producing but jewelry.

"there has been and will continue to be a market for it"

I never said there wasn't.

"the market is deep, liquid, and has correlations to other asset classes that can be just as predictable as your equity and bond analysis."

That is not true. The price of gold is not correlated to anything, and it does not depend on the business cycle.

"you are out of your element"

I think not. I'm also not a paralegal - my degree is in economics.

"are bitcoins money?"

No.

But RF it doesn't today. It isn't generally accepted in exchange for goods and services. When the local bodega will take your krugerands for that six pack of Corona, then the answer to the question "is gold money" will be yes.

It still won't be yes until the government declares it legal tender. Until that time, only US$ is money.

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But RF it doesn't today. It isn't generally accepted in exchange for goods and services. When the local bodega will take your krugerands for that six pack of Corona, then the answer to the question "is gold money" will be yes.

Or when Fresh Direct credits you in gold because of your bad bananas.

Exactly.

I know AR, on that strict basis it is not. What I was trying to do was introduce a broader concept to stevie on the historical relevance of gold and how it certainly has had "currency" throughout time. even today. is it legal tender here in the US - no. but that wasn't my point.

currency, gold, bitcoins all have similar characteristics and depending on how you define money can fall into the same bucket. more broadly, I personally think gold has more value than stevie can fathom or might admit.

I do think it much better at this point in time to be a holder of USD, but I think if I lived in a third world country, I would have a significant stash of gold. that is my point.

"What I was trying to do was introduce a broader concept to stevie on the historical relevance of gold and how it certainly has had "currency" throughout time."

I never said it didn't, and in fact said it did - in the past.

"I personally think gold has more value than stevie can fathom or might admit."

Well I have no way to fathom or admit what value you think gold has. It might make a good market trade, but it's not money, and it doesn't produce income.

"I think if I lived in a third world country, I would have a significant stash of gold. that is my point."

You'd be better off with dollars, because nobody in the third world accepts gold. It would be hard to buy toilet paper with gold.

>I personally think gold has more value than stevie can fathom or might admit.

Gold is worth $1300 to $1400 per ounce. What is the debate? What's to fathom? What's to admit?

well if he is comparing it to crickets and earthworms therein lies the answer to your question.

Hmm. Rhetoric seems to escape ranger! What that means, ranger (and I clearly stated) is that in an economic meltdown, FOOD is worth more than gold.

That's what you seem not to understand. Gold is NOT money. Venezuelans and Argentines aren't hoarding gold; they're hoarding dollars, because they can be spent.

They don't have toilet paper in Venezuelan, ranger. Do you think they want gold instead?

Central banks certainly consider gold to be money.

http://www.dailymail.co.uk/news/article-2307422/Cyprus-sell-gold-finance-soaring-bailout-23billion--bigger-island-s-economy.html

No they don't.

"Is gold money?” Ron Paul asked.

Clearly bothered, Bernanke told the representative, “No. It’s a precious metal.”

After Paul interrupted him to note the long history of gold being used as money, Bernanke continued,”It’s an asset. Would you say Treasury bills are money? I don’t think they’re money either but they’re a financial asset.”

http://www.forbes.com/sites/afontevecchia/2011/07/13/bernanke-fights-ron-paul-in-congress-golds-not-money/

And so is natural gas:

"No, Gazprom Really Isn't Going To Save Cyprus"

http://www.forbes.com/sites/timworstall/2013/03/30/no-gazprom-really-isnt-going-to-save-cyprus/

You don't know what you're talking about, RS.

Gold is the ultimate money. It is portable, eternal, indestructible, divisible, fungible. It stores great value in a small space. Many things have been used as money throughout recorded history and gold has been the most successful by far.

Money is something with intrinsic value that is used as a medium of exchange. That's why paper is currency, not money. Paper has very little intrinsic value.

Some will argue that gold has little intrinsic value. But it has been accepted over thousands of years by virtually all nations in all eras as money. That is evidence that gold has intrinsic value to mankind.

Words can be understood. You can understand that the word "money" means first and foremost, currency, but that it also has a suggestion of intrinsic value, which paper currency lacks, but gold and silver possess (a major reason why they have often been used in, or as, currency).

Really, renter, are you "little hunt bro," as well, on kitcomm.com?

And petruchio2100, as well?

Unfortunately, "portable, eternal, indestructible, divisible, fungible" is not quite true, and it does not make anything "money." It is true that gold is "eternal" and "indestructible" in the sense that it doesn't react with acids or bases - which is the very reason why it has virtually not industrial uses.

That it HAS been accepted is meaningless. Lots of things HAVE been accepted that no longer are, such as slavery.

"Many things have been used as money throughout recorded history and gold has been the most successful by far."

Decidedly UNTRUE, for if it were true we would be using it today. Unfortunately it failed miserably as a currency in a modern economy, which is why it was dropped.

But if you want to think otherwise, post away, here and on other forums, too!

And FYI, renterjoey, or whatever your name is, "portable, eternal, indestructible, divisible, fungible" also applies to many plastics.

They're not money, either.

Currencies come and go, Gold is still with us.

stevie, you are a complete boob. the arguments you are making AGAINST gold are the SAME arguments and actually more relevant arguments you can make about the fallacy of currency.(Ponzi scheme - ironically because of the decoupling from the gold standard, value in an economic collapse, and so on.

Venezuela is a great example of this. you think the populace wants toilet paper (of course) but gold would be a much better option for those who can afford to convert to that asset. and in times of economic and fiscal collapse, history has shown us that people do indeed gravitate to hard assets - if they are able. otherwise, anarchy may swallow them up.

you seem to be arguing that USD are more valuable than gold - that wasn't the question - mister one dimensional. try thinking more abstractly, impossible for the likes of you.

and as for your rhetoric, hard to determine because lots of your stuff is so way out of line, in times of economic collapse currency goes into the shitter usually as a loss leader.

as context, could you provide a recent example in the US of this?

and they haven't had lots of soft commodities in despot nations and even communist nations - because their CURRENCY is tied to their political system and it has no value once it is apparent that their is no base to support that type of flawed leadership and economic structure. now, that sums up your stupidity on this in a nutshell. my five year old can figure it out.

C0C0, you are the most anti-American American on this board, why would you suddenly want an example in the U.S.?

*there

cc, how about the current value of confederate dollars?

Was C0lumbia C0unty part of the C0nfederacy?

your example is the current value of confederate dollars?

cc, ok I will indulge you for a bit more - what is your point? u asked a stupid question but I still gave you a relevant example....

nice. i ask a question and you call it stupid.

should i ask it again or will you now answer it?

I don't think C0C0's question was stupid. But you gave an appropriate answer, and then C0C0 didn't like that.

Depends on condition of the confederate dollar. I have a Confederate $20- worth a couple of hundred last I checked. Totally not the point the poster was making..I get it. Just a bit of levity for the board.

so...this is the most current example?

cc, I thought I did answer it. sorry, stevie and his one dimensional thinking has me riled.

>stevie and his one dimensional thinking has me riled.

Seriously, Steve has you bested?

no, he does not - I have learned that the his greatest asset is to just continue, continue, continue to spew the same nonsense with certain little twists along the way as his logic starts to come apart and finally ends with things like, I never said that, you don't understand this topic, all coming to full circle. then he starts anew. painful....

and cc, is your point the numismatic value of confederate dollars?

i have no idea what you're talking about.

i asked a real question. i have no idea what your answer is.

ok one more time, you asked for a recent example in the US of a currency going into the shitter. at least, that's what I thought you asked, and my response was confederate dollars.......

so...just to repeat. your most recent example is from 1865?

do you really think that's persuasive?

RF, you answered C0C0's question, but now he's pretending you didn't and you are somehow buying into that notion. No wonder you can't beat Steve - you say his arguments and tactics are poor, but then you reveal your obvious weakness.

>so...just to repeat. your most recent example is from 1865?

I do. This is a discussion about gold which has been valued for thousands of years. You asked a question, narrowed your scope to only 1 country in the history of the world to eliminate numerous other examples, and then when presented with the example, it's not good enough for you.

cc, your credibility meter just went tilt....sorry if I couldn't have given you a "recent" example from the US that suits your definition. do you realize how "young" this nation and its socio economic system really is compared to the rest of the civilized world??? wonder why this is considered the "new" world?! and that is not recent enough for you in the context of the evolution of civilized societies. get a clue.

its not my definition .... it yours.

if the last time we experienced this was in 1865, i think we have bigger problems to worry about.

hb, I am hot and cold with you but thanks for the feedback.....

What bigger problems C0C0, your most recent outrage seemed to be that people write reviews on the Internet.

when it agrees with you, you like it?

keep arguing with me....you'll get total agreement from it.

>hb, I am hot and cold with you but thanks for the feedback.....

What kind of example are you setting for your 5 year old?

ok, cc. thanks for the insight. brilliant.

that's the cold part, hb. why I never try to reveal too much personal info, do really get your rocks of referencing that kind of stuff?

there's nothing better than belittling people whose opinion you disagree with. that's working for all of us.