Gold Is The Root Of All Evil, Not Money

[michael94]

Synopsis
Das Rheingold - Wikipedia

 

[TheSir]

But gold is money.

 

[michael94]

But gold is money.

Gold is a commodity with no inherent tie to the real economy. If you think Gold is money then you have fallen for rent-seeking misrepresentations of what money is supposed to be, a token tied as closely to real economic activity as possible.

Real wealth is in a Nations bloodlines,their ability to work, and a country's beauty/natural resources.

The concept of Gold as money is an attempt to replace the importance of who rules you, where you live and who you live around with a metal. Hence "The one ring to rule them all."

 

[TheSir]

Gold is a commodity with no inherent tie to the real economy. If you think Gold is money then you have fallen for rent-seeking misrepresentations of what money is supposed to be, a token tied as closely to real economic activity as possible.

No token could possibly have inherent tie to the real economy. That's the intended function of a token, i.e. to serve as a placeholder for economical value that has not yet been produced, realized or received.

Real wealth is in a Nations bloodlines,their ability to work, and a country's beauty/natural resources.

National potential and resources are 'real wealth' only to the extent their value is utilized. Otherwise these are tokens too.

 

[michael94]

first 12 minutes

 

[Luann]

I also think that national wealth describes the efficiency of work: short average work week, free museums, trust, ability to make scientific advancements, protection of Truth, and good health.

Michael94 you always make me think!

 

[michael94]

No token could possibly have inherent tie to the real economy. That's the intended function of a token, i.e. to serve as a placeholder for economical value that has not yet been produced, realized or received.


National potential and resources are 'real wealth' only to the extent their value is utilized. Otherwise these are tokens too.

That's exactly right, which means Gold isnt Money. Gold is a commodity that can be used as money if the King puts his stamp on it. The real Nature of Money is Fiat. This is not a bad thing, it means the organization of Government and who you live with is extremely important. Trying to fix this problem with Gold is a false promise.

 

[Waynish]

That's exactly right, which means Gold isnt Money. Gold is a commodity that can be used as money if the King puts his stamp on it. The real Nature of Money is Fiat. This is not a bad thing, it means the organization of Government and who you live with is extremely important. Trying to fix this problem with Gold is a false promise.

I have some deeper gravy for ya: gold is actually fabricated... It was not merely an element that cannot be created by humans - just by stars or whatever their gay little story is these days.

 

[GelatinGoblin]

Gold is a commodity with no inherent tie to the real economy. If you think Gold is money then you have fallen for rent-seeking misrepresentations of what money is supposed to be, a token tied as closely to real economic activity as possible.

Real wealth is in a Nations bloodlines,their ability to work, and a country's beauty/natural resources.

The concept of Gold as money is an attempt to replace the importance of who rules you, where you live and who you live around with a metal. Hence "The one ring to rule them all."

Man the Russians and Chinese governments who are buying gold realise their **** up after this bombshell...

 

[Kvothe]

Gold is a commodity with no inherent tie to the real economy. If you think Gold is money then you have fallen for rent-seeking misrepresentations of what money is supposed to be, a token tied as closely to real economic activity as possible.

Real wealth is in a Nations bloodlines,their ability to work, and a country's beauty/natural resources.

The concept of Gold as money is an attempt to replace the importance of who rules you, where you live and who you live around with a metal. Hence "The one ring to rule them all."

What are you even doing on this forum when you adore Hitler, and fantasize about bloodlines and a people's "ability to work" ? You are exactly the kind of neo-darwinist fascist that Peat constantly ridicules and despises.

 

[ThinPicking]

That's exactly right, which means Gold isnt Money. Gold is a commodity that can be used as money if the King puts his stamp on it. The real Nature of Money is Fiat. This is not a bad thing, it means the organization of Government and who you live with is extremely important. Trying to fix this problem with Gold is a false promise.

Nice thread, couldn't agree more.

What gives the fiat value and why that matters is worth some attention. There seems to be a push for support of something like Universal Basic Income. I'm convinced it's a terrible idea.

 

[TheSir]

That's exactly right, which means Gold isnt Money. Gold is a commodity that can be used as money if the King puts his stamp on it. The real Nature of Money is Fiat.

You've got it backwards: the real nature of fiat is money. Both gold and fiat can be used as money, yet neither is inherently money, but rather so only by virtue of enforcement or common agreement.

 

[Whichway?]

I agree with Solzhenitsyn that evil begins in the human heart. So we need to look for the root of evil there.

Real wealth is in a Nations bloodlines,their ability to work, and a country's beauty/natural resources.

I really agree with this and these are parameters that economics completely ignores in its measurements.

What are you even doing on this forum when you adore Hitler, and fantasize about bloodlines and a people's "ability to work" ? You are exactly the kind of neo-darwinist fascist that Peat constantly ridicules and despises.

Have you got anything to contribute? Seems you are intent on criticizing the person rather than providing any rebuttal to the ideas themselves. If you disagree and have better information that will help us understand the world better and make better decisions, then please provide it. If not, shut up.

 

[michael94]

deceiver

 

[Hgreen56]

The people are the root of all evil, not the gold and money

Take a look at all the animals, they don't care about gold or money.
(except for magpies then )

 

[michael94]

What are you even doing on this forum when you adore Hitler, and fantasize about bloodlines and a people's "ability to work" ? You are exactly the kind of neo-darwinist fascist that Peat constantly ridicules and despises.

Dont really agree with darwin about anything. I dont believe in evolution as it is taught ( i.e. we evolved from primates who evolved from fish that crawled onto land ). Fascism was a pushback to money changers overstepping with their schemes. Yea it can be perceived as too authoritarian, but its much less nefarious than what Finance capitalists were doing and still are doing. If you torture someone and they lash out who is the bad guy? People get pissed when their daughters and mothers start prostituting themselves just to be able to eat, imagine if they knew the reasons for the situation they were in. Fury can be a gift.

 

[James ardagna]

not understanding what real money is and the subsequent lack of gold backing of the US dollar is what has got America in the mess that it is in. the unchecked fiat currency model simply increases the wealth divide, similar to what we are seeing at the moment with money printing. the opposite encourages people to save, not spend. Dan Oliver has written many articles like the following that helps explain gold as money and its importance over the last few thousand years.


Feb 29, 2012,01:08pm EST
Warren Buffett May Know Value, But He Doesn't Know What Money Is

Capital FlowsContributor
Opinion
Guest commentary curated by Forbes Opinion. Avik Roy, Opinion Editor.
This article is more than 8 years old.
By Daniel Oliver Jr.

Warren Buffett may be able to spot value, but the poor man has no idea what money is. In his latest screed against gold, Buffett compares the metal of kings to tulips: an asset to be bought either for decorative value or in the hope it can be sold again to a greater fool at a higher price. Gold has little industrial use and does not procreate: “if you own one ounce of gold for an eternity, you will still own one ounce at its end.”

Buffett is correct that an once of gold will never increase nor diminish in size, but he ignores the fact that its value has been steadily increasing for at least 200 years.

According to the Historical Statistics of the United States, in 1800 an ounce of gold bought 11 bushels of wheat. In 1998, even as gold probed a generational low, an ounce purchased 85 bushels. Gold’s purchasing power in terms of copper went from 36 pounds per ounce to 365 pounds during the same time period, and it rose 5.3 times against cotton. Since 1998, gold has continued to rise, tripling against the CRB Commodities Index. Not bad for an inanimate metal the best use of which, according to Buffett, is to be fondled.

The reason for gold’s historical performance is simple: it is money.

Carl Menger, founder of the Austrian School of economics, was the first to explain why every economic agent is “ready to exchange his goods for little metal disks apparently useless as such, or for documents representing the latter.” Most goods are
illiquid, meaning transaction costs of trade are high.



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Anyone wishing to swap one good for another has two choices. Either he can barter, which requires finding a trading partner with exact coincidence of needs, or he can trade his goods for an intermediate good, more liquid than his own, that will enable him to obtain the goods he seeks from third parties.

The elements of liquidity include spatial considerations, such a low transaction costs, uniformity and divisibility, and general acceptability. They also include temporal characteristics, such as low storage costs, indestructibility, and a stable value over time. These latter qualities allow for savings, which is the basis of all capital formation.

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Gold is money because of all the elements it most perfectly embodies the attributes of liquidity. Currency, mere paper at best, can act as money only to the extent it is backed by gold or sound promises to deliver gold.

But why should the value of gold increase over time?

Henry Hazlitt defined inflation as: “an increase in the supply of money that outruns the increase in the supply of goods.” When the opposite happens, when the increase in the supply of goods exceeds the increase in money, prices go down.

Gold mining adds approximately 1.5% to the above ground supply each year, and global economic growth over the past 200 years has been far higher. As long as economic growth continues to exceed gold production, gold’s value will continue to increase.

Buffett claims that gold has no yield, yet its purchasing power has compounded at an annual rate of 0.9% for over two centuries. And, the increase is pure, safe from onerous transaction costs, hidden from the avaricious eyes of the taxman, and immune from the threat of currency debasement.

Buffett is also incorrect about gold’s function: its purpose is not to be hoarded. In the Parable of the Talents, Jesus praises the servants who invest their money and curses the servant who buries his money in the ground. Capital used for productive increase should always outpace money, so it is no surprise that stocks should outperform gold. What is shocking is by how little they have outperformed.

Using Buffett’s own numbers, since 1965 the S&P 500 has compounded by 9.3% per year, as opposed to 8.6% for gold. Since three-quarters of the S&P’s return is compounded dividends, and since its components constantly change, the extra 0.7% return more than vanishes after deducting for taxes and transaction costs. Investing talent in productivity may be good and noble, but sinking capital into the market has enriched only management and the army of middlemen required to navigate the 145,000 pages of federal regulations.

Gold’s value rises gradually with economic growth over the long term, but it spikes when the productive must bury their wealth to protect it from a rapacious state. A Congressman explained gold’s political role in 1948, saying: “If Congress seemed receptive to reckless spending schemes, depositors’ demands over the country for gold would soon become serious.” The Congressman was, of course, Warren Buffet’s father, and he described exactly what is now occurring.

Howard Buffett understood the “connection between money, redeemable in gold, and the rare prize known as human liberty” in a way his son, obviously, does not. Warren writes that a cow, giving milk, is a better investment than gold. And so it should be. But milk can have price controls imposed on it, and cows can be taxed or confiscated. Warren should know, since he constantly agitates for higher taxes.

Government spending at all levels accounts for 40% of GDP and, as Milton Friedman taught, the burden of government is how much it spends, not how much it taxes. The federal government must now borrow more than a third of its expenditures and, when the voluntary contributions known as Treasury bonds dwindle, the state will use more direct methods.

Ultimately, all such experiments in centralized economics fail, and hoarded gold will come back into circulation for productive use. Those wise enough to have held and to part with their gold when liberty reemerges will be rewarded for their husbandry of capital with ownership of productive assets.

Warren Buffett will not be among them. As he says, “What the wise man does in the beginning, the fool does in the end.” When Buffett finally panics into gold, sell it to him.

— Daniel Oliver Jr. is the founder of Myrmikan Capital, LLC, and a director of the Committee for Monetary Research and Education. He has a J.D. from Columbia Law School and an M.B.A. from INSEAD.

 

[Kvothe]

Dont really agree with darwin about anything. I dont believe in evolution as it is taught ( i.e. we evolved from primates who evolved from fish that crawled onto land ). Fascism was a pushback to money changers overstepping with their schemes. Yea it can be perceived as too authoritarian, but its much less nefarious than what Finance capitalists were doing and still are doing. If you torture someone and they lash out who is the bad guy? People get pissed when their daughters and mothers start prostituting themselves just to be able to eat, imagine if they knew the reasons for the situation they were in. Fury can be a gift.

I gotta hand it to you - at least you are honest, and do not try to hide your basic convictions. I can respect that. Like I said, I just don't understand what you are doing here of all places. I imagine there are countless neo-Nazi forums where you will find more sympathetic minds.

 

[Kram]

Dont really agree with darwin about anything. I dont believe in evolution as it is taught ( i.e. we evolved from primates who evolved from fish that crawled onto land ).

Where do you think humans came from? Genuinely interested

 

[managing]

not understanding what real money is and the subsequent lack of gold backing of the US dollar is what has got America in the mess that it is in. the unchecked fiat currency model simply increases the wealth divide, similar to what we are seeing at the moment with money printing. the opposite encourages people to save, not spend. Dan Oliver has written many articles like the following that helps explain gold as money and its importance over the last few thousand years.


Feb 29, 2012,01:08pm EST
Warren Buffett May Know Value, But He Doesn't Know What Money Is

Capital FlowsContributor
Opinion
Guest commentary curated by Forbes Opinion. Avik Roy, Opinion Editor.
This article is more than 8 years old.
By Daniel Oliver Jr.

Warren Buffett may be able to spot value, but the poor man has no idea what money is. In his latest screed against gold, Buffett compares the metal of kings to tulips: an asset to be bought either for decorative value or in the hope it can be sold again to a greater fool at a higher price. Gold has little industrial use and does not procreate: “if you own one ounce of gold for an eternity, you will still own one ounce at its end.”

Buffett is correct that an once of gold will never increase nor diminish in size, but he ignores the fact that its value has been steadily increasing for at least 200 years.

According to the Historical Statistics of the United States, in 1800 an ounce of gold bought 11 bushels of wheat. In 1998, even as gold probed a generational low, an ounce purchased 85 bushels. Gold’s purchasing power in terms of copper went from 36 pounds per ounce to 365 pounds during the same time period, and it rose 5.3 times against cotton. Since 1998, gold has continued to rise, tripling against the CRB Commodities Index. Not bad for an inanimate metal the best use of which, according to Buffett, is to be fondled.

The reason for gold’s historical performance is simple: it is money.

Carl Menger, founder of the Austrian School of economics, was the first to explain why every economic agent is “ready to exchange his goods for little metal disks apparently useless as such, or for documents representing the latter.” Most goods are
illiquid, meaning transaction costs of trade are high.



Recommended For You

• Is It Safe To Crack Your Knees And Knuckles?

Anyone wishing to swap one good for another has two choices. Either he can barter, which requires finding a trading partner with exact coincidence of needs, or he can trade his goods for an intermediate good, more liquid than his own, that will enable him to obtain the goods he seeks from third parties.

The elements of liquidity include spatial considerations, such a low transaction costs, uniformity and divisibility, and general acceptability. They also include temporal characteristics, such as low storage costs, indestructibility, and a stable value over time. These latter qualities allow for savings, which is the basis of all capital formation.

PROMOTED

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The Mother Of All Summits

Gold is money because of all the elements it most perfectly embodies the attributes of liquidity. Currency, mere paper at best, can act as money only to the extent it is backed by gold or sound promises to deliver gold.

But why should the value of gold increase over time?

Henry Hazlitt defined inflation as: “an increase in the supply of money that outruns the increase in the supply of goods.” When the opposite happens, when the increase in the supply of goods exceeds the increase in money, prices go down.

Gold mining adds approximately 1.5% to the above ground supply each year, and global economic growth over the past 200 years has been far higher. As long as economic growth continues to exceed gold production, gold’s value will continue to increase.

Buffett claims that gold has no yield, yet its purchasing power has compounded at an annual rate of 0.9% for over two centuries. And, the increase is pure, safe from onerous transaction costs, hidden from the avaricious eyes of the taxman, and immune from the threat of currency debasement.

Buffett is also incorrect about gold’s function: its purpose is not to be hoarded. In the Parable of the Talents, Jesus praises the servants who invest their money and curses the servant who buries his money in the ground. Capital used for productive increase should always outpace money, so it is no surprise that stocks should outperform gold. What is shocking is by how little they have outperformed.

Using Buffett’s own numbers, since 1965 the S&P 500 has compounded by 9.3% per year, as opposed to 8.6% for gold. Since three-quarters of the S&P’s return is compounded dividends, and since its components constantly change, the extra 0.7% return more than vanishes after deducting for taxes and transaction costs. Investing talent in productivity may be good and noble, but sinking capital into the market has enriched only management and the army of middlemen required to navigate the 145,000 pages of federal regulations.

Gold’s value rises gradually with economic growth over the long term, but it spikes when the productive must bury their wealth to protect it from a rapacious state. A Congressman explained gold’s political role in 1948, saying: “If Congress seemed receptive to reckless spending schemes, depositors’ demands over the country for gold would soon become serious.” The Congressman was, of course, Warren Buffet’s father, and he described exactly what is now occurring.

Howard Buffett understood the “connection between money, redeemable in gold, and the rare prize known as human liberty” in a way his son, obviously, does not. Warren writes that a cow, giving milk, is a better investment than gold. And so it should be. But milk can have price controls imposed on it, and cows can be taxed or confiscated. Warren should know, since he constantly agitates for higher taxes.

Government spending at all levels accounts for 40% of GDP and, as Milton Friedman taught, the burden of government is how much it spends, not how much it taxes. The federal government must now borrow more than a third of its expenditures and, when the voluntary contributions known as Treasury bonds dwindle, the state will use more direct methods.

Ultimately, all such experiments in centralized economics fail, and hoarded gold will come back into circulation for productive use. Those wise enough to have held and to part with their gold when liberty reemerges will be rewarded for their husbandry of capital with ownership of productive assets.

Warren Buffett will not be among them. As he says, “What the wise man does in the beginning, the fool does in the end.” When Buffett finally panics into gold, sell it to him.

— Daniel Oliver Jr. is the founder of Myrmikan Capital, LLC, and a director of the Committee for Monetary Research and Education. He has a J.D. from Columbia Law School and an M.B.A. from INSEAD.

The lack of wage growth in the face of currency expansion does indeed increase the wealth divide. But encouraging savings does not do the opposite. Indeed, it can have a similar effect, unless everybody is hiding the money in their mattress. And leads to stagflation. There is nothing inherently evil or unjust in currency expansion. Only in the institutions that govern it. But the real problem is there is a vast lack of understanding of basic economics in government, and where it is understood there is an incredible myopia. This permitted "trickle down economics" which, although the word has gone out of fashion, persists today. "Trickle" indeed.