View Full Version : Gold does not have intrinsic value
brandon
10-23-2009, 07:26 AM
What Is Money?
Part 8: Why Gold Has No Intrinsic Value
by Gary North
Whenever you hear someone speak of gold's having intrinsic value, you can be sure that he has a confused theory of economics in general and monetary theory in particular. There is no such thing as a free lunch. There is also no such thing as intrinsic value.
The meaning of the word "intrinsic" is always difficult to pin down. It means "autonomous." It implies fixity. There is neither in economic life.
It was Carl Menger's profound insight in 1871 to recognize that economic value is imputed by each individual. The value of the tools of production, the value of land, and the value of labor expended in the creation of a final consumer good do not move forward in time from the value of the inputs. They move in response to entrepreneurs' estimates of future value imputed by customers. This was Menger's great discovery.
Economic value is subjective. It cannot be measured.....
Read the rest at http://www.lewrockwell.com/north/north772.html
brandon
10-23-2009, 07:27 AM
Why does Peter Schiff constantly say gold has intrinsic value?
It makes me really doubt his knowledge.
specsaregood
10-23-2009, 07:32 AM
Why does Peter Schiff constantly say gold has intrinsic value?
It makes me really doubt his knowledge.
So I guess you agree with the author you linked to when he says,
"God has intrinsic value. Nothing else does."?
sevin
10-23-2009, 07:34 AM
So I guess you agree with the author you linked to when he says,
"God has intrinsic value. Nothing else does."?
lolz
brandon
10-23-2009, 07:37 AM
So I guess you agree with the author you linked to when he says,
"God has intrinsic value. Nothing else does."?
Absolutely, and I am not religious.
Krugerrand
10-23-2009, 07:56 AM
Why does Peter Schiff constantly say gold has intrinsic value?
It makes me really doubt his knowledge.
In a very literal sense, it is true that gold has no intrinsic value. But - what gold does have is thousands of years of consistent and steady value. That's about a close to 'intrinsic' as anything will ever get from a monetary perspective.
A more true use of 'intrinsic' would be something that is consumable yet has limited quantities. Peter Schiff's father has a comic book that uses 'fish' as a monetary system.
Within an historical and practical perspective - and especially relative to fiat currency - gold has intrinsic value.
brandon
10-23-2009, 07:58 AM
Gold certainly does not have an intrinsic value and it makes us looks like fools when we go around saying it does.
But - what gold does have is thousands of years of consistent and steady value.
O rly?
http://www.kitco.com/LFgif/au75-pres.gif
Sure the value of gold has been much more steady than fiat money, but it still has been far from steady. There are massive fluctuations all the time.....because it has no intrinsic value.
specsaregood
10-23-2009, 08:02 AM
Gold certainly does not have an intrinsic value and it makes us looks like fools when we go around saying it does.
O rly?
http://www.kitco.com/LFgif/au75-pres.gif
Sure the value of gold has been much more steady than fiat money, but it still has been far from steady. There are massive fluctuations all the time.....because it has no intrinsic value.
So you (your graph) are using a fiat money as the basis of your measurement of value. Despite admitting that gold has been more steady than said fiat money? Do you see a problem with that?
Bruno
10-23-2009, 08:07 AM
If anything does have intrinsic value, then gold does.
The dictionary.com definition even uses gold in its first example:
in⋅trin⋅sic /ɪnˈtrɪnsɪk, -zɪk/ Show Spelled Pronunciation [in-trin-sik, -zik] Show IPA
Use intrinsic in a Sentence
See web results for intrinsic
See images of intrinsic
–adjective 1. belonging to a thing by its very nature: the intrinsic value of a gold ring.
2. Anatomy. (of certain muscles, nerves, etc.) belonging to or lying within a given part.
If you don't believe gold has intrinsic value, then what on earth does?
brandon
10-23-2009, 08:08 AM
So you (your graph) are using a fiat money as the basis of your measurement of value. Despite admitting that gold has been more steady than said fiat money? Do you see a problem with that?
No I don't see the problem with that. Look how gold dropped so drastically from 1980 to 2000 and in the meantime the money supply doubled and the prices of everything else in dollars increased drastically.
What do you want to compare gold too? Whatever you chose you will see the same thing.
brandon
10-23-2009, 08:08 AM
If you don't believe gold has intrinsic value, then what on earth does?
Nothing! That's the point!
Bruno
10-23-2009, 08:10 AM
Nothing! That's the point!
well, then I guess we can remove that word from the dictionary
Icymudpuppy
10-23-2009, 08:11 AM
If you don't believe gold has intrinsic value, then what on earth does?
Food, Shelter, Water. These are the three things necessary to sustain human life. They are the only things which have intrinsic value.
not.your.average.joe
10-23-2009, 08:12 AM
Gold certainly does not have an intrinsic value and it makes us looks like fools when we go around saying it does.
O rly?
http://www.kitco.com/LFgif/au75-pres.gif
Sure the value of gold has been much more steady than fiat money, but it still has been far from steady. There are massive fluctuations all the time.....because it has no intrinsic value.
Doesnt this graph show the fluctuations of the fiat currency against gold?
A better chart for measuring the consistancy(or lack there of in some peoples minds) of the value of gold would be goods priced in gold over the years, wouldnt it?
brandon
10-23-2009, 08:14 AM
well, then I guess we can remove that word from the dictionary
The word "intrinsic" is a great word! The problem is when you follow it by the word "value."
Question: If things have intrinsic value, then why wouldn't a centrally planned economy work? Surely it would be easy for us to calculate prices without a marketplace.
specsaregood
10-23-2009, 08:15 AM
./
brandon
10-23-2009, 08:16 AM
Food, Shelter, Water. These are the three things necessary to sustain human life. They are the only things which have intrinsic value.
Nah, even these things don't have intrinsic value.
When you have no food a cheeseburger may be worth working 8 hours for.
But when you already have 1000 cheeseburgers an additional cheeseburger is almost worthless to you.
Icymudpuppy
10-23-2009, 08:23 AM
merriam webster defines the word "intrinsic" as "relating to the essential nature or constitution of a thing". It does not imply consistent relative value. Only that the object has value. Gold has no objective value. Nobody NEEDs gold to survive. Everyone NEEDs food, shelter, and water to survive. As such, gold does not have intrinsic value, but a cheeseburger does even if the cheeseburger's relative value fluctuates, it's intrinsic value remains constant. You need about 1 cheeseburger a day to survive..
Bruno
10-23-2009, 08:35 AM
The word "intrinsic" is a great word! The problem is when you follow it by the word "value."
Question: If things have intrinsic value, then why wouldn't a centrally planned economy work? Surely it would be easy for us to calculate prices without a marketplace.
because though something may have intrinsic value, that value can fluctuate based upon conditions. If a huge store of gold were discovered, the value of the gold existing would decrease, just as in your cheeseburger analogy.
It doesn't necessarily mean that the value is constant, just that a value exists.
brandon
10-23-2009, 08:38 AM
because though something may have intrinsic value, that value can fluctuate based upon conditions. If a huge store of gold were discovered, the value of the gold existing would decrease, just as in your cheeseburger analogy.
It doesn't necessarily mean that the value is constant, just that a value exists.
So then I guess paper money has intrinsic value too...right? It's value is not constant, but a value does exist.
The concept that anything has any value from within, and not from the subjective opinion of individuals in a marketplace, is really the cornerstone of marxism, socialism, and other centrally planned economic theories.
teacherone
10-23-2009, 08:41 AM
This thread has a definition deficit.
Intrinsic value means that it always has and always will have value.
It does in NO WAY imply that that value will remain constant.
Pretty obvious IMHO.:cool:
tmosley
10-23-2009, 08:45 AM
Of course gold has intrinsic value. One ounce of gold is worth one ounce of gold. Dollars, on the other hand, do not have intrinsic value, save for the value of the paper they are printed on.
It doesn't matter how much gold is available, one ounce is always worth one ounce, whereas a dollar isn't always worth a dollar, when more are being printed, or zeros are being added onto the end.
And further than that, gold has intrinsic value TO HUMANS LIVING IN A SOCIETY as a means of exchange. Remember that you have to measure everything against humanity, not against the universe in general. EVERYTHING is meaningless to the universe, but lots of things have meaning to humans.
Gold's value is considered intrinsic because gold does not normally degrade. If you take a gold coin and bury it and dig it up ten thousand years later, it will still have value. If you take a bit of beef jerky and bury it, it will have no value ten thousand years later. Water will evaporate away. Most shelters will crumble over that time period. Only gold remains.
To say that nothing has value is a nihilistic argument, and should be discarded. If the person making such an argument persists, then they have admitted on record that their life is worthless, and they can simply be killed. Suicidal ideology fails.
brandon
10-23-2009, 08:46 AM
This thread has a definition deficit.
Intrinsic value means that it always has and always will have value.
It does in NO WAY imply that that value will remain constant.
Pretty obvious IMHO.:cool:
lol...intrinsic value doesn't mean either of those things. And besides...how would we know if something had value 3 billion years ago? I'm guessing gold had zero value before humans became cognizant enough to like shiny things and start making jewelry.
"Intrinsic value" means the value of something comes from within. It has value based on what it is alone.
tmosley
10-23-2009, 08:47 AM
So then I guess paper money has intrinsic value too...right? It's value is not constant, but a value does exist.
The concept that anything has any value from within, and not from the subjective opinion of individuals in a marketplace, is really the cornerstone of marxism, socialism, and other centrally planned economic theories.
You can't put a zero behind a gold bar and say it's worth ten times as much. Fiat money has value only as a symbol. It's value is not intrinsic, because you can just keep adding zeros. Most other things don't have intrinsic value because they decay over time, or can otherwise be easily destroyed or dispersed.
Why does Peter Schiff constantly say gold has intrinsic value?
It makes me really doubt his knowledge.
So I assume you really doubt Ron Paul's "knowledge" as well?
http://www.lewrockwell.com/paul/paul293.html
Gold prices historically rise when faith in paper currencies erodes, as investors seek the intrinsic value of gold to protect themselves from inflation.
brandon
10-23-2009, 08:49 AM
So I assume you really doubt Ron Paul's "knowledge" as well?
http://www.lewrockwell.com/paul/paul293.html
Yes, that is very disappointing.
tmosley
10-23-2009, 08:51 AM
Yes, that is very disappointing.
You best be trollin'.
teacherone
10-23-2009, 08:51 AM
lol...intrinsic value doesn't mean either of those things. And besides...how would we know if something had value 3 billion years ago? I'm guessing gold had zero value before humans became cognizant enough to like shiny things and start making jewelry.
"Intrinsic value" means the value of something comes from within. It has value based on what it is alone.
Since man discovered money, gold has been the preferred currency. Thousands of years of history prove this.
Fire didn't have any value to man before he discovered it either.
Yet fire's value, like gold's is now intrinsic and indisputable.
brandon
10-23-2009, 08:53 AM
This thread really disappoints me. :(
Bruno
10-23-2009, 08:55 AM
So then I guess paper money has intrinsic value too...right? It's value is not constant, but a value does exist.
The concept that anything has any value from within, and not from the subjective opinion of individuals in a marketplace, is really the cornerstone of marxism, socialism, and other centrally planned economic theories.
I see what you are saying, but I don't think the differences are that far apart. A centrally planned economy would set the value of the commodity and/or control its distribution, as opposed to the free market determining its worth.
Does oil have intrinsic value? It didn't until a use for it was discovered. Now it does. Free markets control its prices in some ecomomies, as well as central planners in other countries.
brandon
10-23-2009, 08:55 AM
Yet fire's value, like gold's is now intrinsic and indisputable.
Well then, please tell me the value of one 3 foot by 3 foot fire. How many cheeseburgers does it equal?
This thread really disappoints me. Is their not even one person here who actually understands economics? :(
Yeah you're right, Ron Paul and Peter Schiff don't understand economics but you do. Thank God you read that Gary North article or we would all be trapped in the dark ages forever.
brandon
10-23-2009, 08:59 AM
Does oil have intrinsic value? It didn't until a use for it was discovered. Now it does. Free markets control its prices in some ecomomies, as well as central planners in other countries.
Remove the word "intrinsic" and I completely agree with you. The fact that value depends on whether or not humans have a use for it makes it pretty clear the value is not intrinsic.
brandon
10-23-2009, 09:00 AM
Yeah you're right, Ron Paul and Peter Schiff don't understand economics but you do. Thank God you read that Gary North article or we would all be trapped in the dark ages forever.
Nah I have been thinking this and debating this on this here forum for quite a long time. I just saw the article today and decided it was time to bring this issue up again.
teacherone
10-23-2009, 09:03 AM
Value is subjective. And from the subjective standpoint of a human gold, fire, and oil have intrinsic value.
Well then, please tell me the value of one 3 foot by 3 foot fire. How many cheeseburgers does it equal?
You clearly don't understand economics or even what "value" means.
Value is usefulness.
You are asking me to convert the value of fire (you cook and heat your home with it..aka value) to dollars needed to purchase cheeseburgers??
Idiotic premise.
Bruno
10-23-2009, 09:03 AM
Well then, please tell me the value of one 3 foot by 3 foot fire. How many cheeseburgers does it equal?
Its measure in BTUs, which would translate into how many cheeseburgers could be cooked using its heat.
not.your.average.joe
10-23-2009, 09:11 AM
Remove the word "intrinsic" and I completely agree with you. The fact that value depends on whether or not humans have a use for it makes it pretty clear the value is not intrinsic.
Couldnt you say that oil always had that value? It always had the capability to be used, but just because humans didnt fiure it out until a certain point in time doesnt mean that it didnt have the properties necassary to be used for fuel before that. The value was always there, we just figured out how to use it.
tmosley
10-23-2009, 09:13 AM
This thread really disappoints me. :(
Why, because people don't see the world through a filter of nihilism like you? Until the universe becomes sentient, those things which the universe values don't matter one whit to me. Everything is viewed from a human perspective, and if you think otherwise, you're an idiot.
One ounce of gold is worth an ounce of gold. If you don't believe that, you're an idiot. Gold does not degrade under any but the most extreme circumstances. If you don't believe that, you're an idiot. Gold has intrinsic value as a tool of trade.
I swear, you're argument is like saying that there is no up or down because the earth is spinning around the sun which is spinning around the galaxy which is traveling through the universe. You have no perspective, and therefore your arguments are STUPID.
shocker315
10-23-2009, 09:14 AM
Gold has intrinsic value because it can not be "created". Thus... there is a natural scarcity which creates value intrinsic to its nature.
Food, clothes, shelter, and other products can be "created" through our efforts. While it is possible to mine more gold...one can not "create" more gold through some form production...like "turning lead into gold". It must be found...not produced in an assembly line.
Gold does not deteriorate, rust, or decay (unlike many other commodities and products) also adding to its value. Gold lasts over time...the gold you have in your hand may have been literally melted down several times over from Roman or Aztec ingots from centuries ago. Thus its longevity preserves its intrinsic value over time.
There are other reasons...but those are the main ones. The title of this thread is wrong. All of human history proves the point to be incorrect.
teacherone
10-23-2009, 09:21 AM
Economists use the term value to denote usefulness.
Gold is useful as a currency. But it has a myriad of other intrinsic properties of use to humans.
Paper also has intrinsic value--you can write on it, burn it, and wipe with it.
But you don't need a bunch of fancy pictures printed on it to do so. ;)
Bruno
10-23-2009, 09:25 AM
Economists use the term value to denote usefulness.
Gold is useful as a currency. But it has a myriad of other intrinsic properties of use to humans.
Paper also has intrinsic value--you can write on it, burn it, and wipe with it.
But you don't need a bunch of fancy pictures printed on it to do so. ;)
this is like the "understood you" in a sentence. It is a given that we are using the words intrinsic and value with their meanings subjective to humans.
teacherone
10-23-2009, 09:31 AM
this is like the "understood you" in a sentence. It is a given that we are using the words intrinsic and value with their meanings subjective to humans.
referring to the OP
I'm guessing gold had zero value before humans became cognizant enough to like shiny things and start making jewelry.
The fact that value depends on whether or not humans have a use for it makes it pretty clear the value is not intrinsic.
ctiger2
10-23-2009, 09:46 AM
This thread really disappoints me. :(
I think you're really disappointed because you don't posses any Gold. :D
ctiger2
10-23-2009, 09:53 AM
It may help to look at the value of Gold in a diff way. Instead of thinking 1 oz Gold is worth $1,000 USD. Reverse it to, it takes $1,000 USD to buy 1 oz of Gold. So when you see the price of Gold going up in USD, it's actually the value of the USD going down. It will take $2,500 USD to buy 1 oz of Gold soon enough. The value of Gold is constant, it's the value of the fiat paper USD currency used to purchase the Gold that is going down. So, it takes more of them to get that same 1 oz of Gold.
Ninja Homer
10-23-2009, 10:01 AM
Welcome to the English language, where putting 2 or more words together can create a "phrase" that may have a different definition than the 2 words taken separately, and the phrase may have different definitions depending on the subject of discussion.
http://en.wikipedia.org/wiki/Intrinsic_value_%28numismatics%29
Intrinsic value, in general, is the argument that the value of a product is intrinsic within the product rather than dependent on the buyer's perception.
In commodity money, intrinsic value can be partially or entirely due to the desirable features of the object as a medium of exchange and a store of value. Examples of such features include divisibility; easily and securely storable and transportable; scarcity; and hard to counterfeit. When objects come to be used as a medium of exchange they lower the high transaction costs associated with barter and other in-kind transactions.
In numismatics, intrinsic value is the value of the metal, typically a precious metal, in a coin. For example, if gold trades at a price of USD 450 per fine troy ounce ($14/g), a coin minted from one troy ounce of fine gold would have an intrinsic value of USD 450. When the intrinsic value becomes greater than the face value, the coins are in danger of being removed from circulation in large numbers (an expression of Gresham's law). When the coin is in use as money this effect can, at the margin, mitigate forces that might otherwise cause inflation. When copper prices skyrocketed in the mid-to-late 1970s, there was a fear that the U.S. one-cent piece might succumb to this fate. In fact, this did happen, leading the Mint to change the composition of the cent in 1982.
http://en.wikipedia.org/wiki/Intrinsic_theory_of_value
An intrinsic theory of value is any theory of value in economics which holds that the value of an object, good or service, is intrinsic or contained in the item itself. Most such theories look to the process of producing an item, and the costs involved in that process, as a measure of the item's intrinsic value.
For instance, the labor theory of value - the most influential of the intrinsic theories - holds that the value of an item comes from the amount of labor spent producing said item. For example, if a chair is produced by two workers in 6 hours, then that chair is worth 2 x 6 = 12 man-hours (this is a simplified case; the labor theory of value takes into consideration only the "necessary" amount of labor that must go into the production of an item, which may be less than the actual expended labor due to inefficiency).
http://en.wikipedia.org/wiki/Intrinsic_value_%28finance%29
In finance, intrinsic value refers to the value of a security which is intrinsic to or contained in the security itself. It is also frequently called fundamental value. It is ordinarily calculated by summing the future income generated by the asset, and discounting it to the present value.
http://en.wikipedia.org/wiki/Intrinsic_value_%28ethics%29
Intrinsic value is an ethical and philosophic property. It is the ethical or philosophic value that an object has "in itself" or "for its own sake", as an intrinsic property. An object with intrinsic value may be regarded as an end or end-in-itself.
It is contrasted with instrumental value (or extrinsic value), the value of which depends on how much it generates intrinsic value. For an eudaemonist, happiness has intrinsic value, while having a family may not have intrinsic value, yet be instrumental, since it generates happiness. Intrinsic value is a term employed in axiology, the study of quality or value.
http://en.wikipedia.org/wiki/Intrinsic_value_%28animal_ethics%29
The intrinsic value of an animal refers to the value it possesses in its own right, as an end-in-itself, as opposed to its Instrumental value, its value to other animals (including human beings). The phrase (often used synonymously with inherent value) has been adopted by animal rights advocates. The Dutch Animal Health and Welfare Act referred to it in 1981: "Acknowledgment of the intrinsic value of animals means that animals have value in their own right and as a consequence their interests are no longer automatically subordinate to man's interests."[1] This acknowledgement has stirred a debate on what it entails in the context of animal husbandry, animal breeding, vivisection, animal testing and biotechnology.
Bruno
10-23-2009, 10:02 AM
referring to the OP
yes.
brandon
10-23-2009, 10:22 AM
One ounce of gold is worth an ounce of gold. If you don't believe that, you're an idiot. Gold does not degrade under any but the most extreme circumstances. If you don't believe that, you're an idiot.
I really have no idea what point you're trying to make or how this relates to anything in this thread.
brandon
10-23-2009, 10:25 AM
Value is subjective. And from the subjective standpoint of a human gold, fire, and oil have intrinsic value.
You clearly don't understand economics or even what "value" means.
Value is usefulness.
Again, your post is full of contradictions. I think you are the one that doesn't understand. The theory that value is based on usefulness is a marxist idea that has been rejected by free market economists and people who believe value is subjective.
http://en.wikipedia.org/wiki/Use_value - Especially see the section comparing Marx's use value theory to the neoclassical theory of utility.
brandon
10-23-2009, 10:31 AM
I think you're really disappointed because you don't posses any Gold. :D
I actually have two ounces! I'm a big fan of gold and think it's a great store of wealth.
JoshLowry
10-23-2009, 10:33 AM
Why does Peter Schiff constantly say gold has intrinsic value?
It makes me really doubt his knowledge.
What Is Money?
Part 8: Why Gold Has No Intrinsic Value
by Gary North
The meaning of the word "intrinsic" is always difficult to pin down. It means "autonomous." It implies fixity. There is neither in economic life.
You're having an argument about semantics. Gold has value.
Gary says the meaning of the word is difficult to pin down.
Does this make Peter Schiff an idiot?
Meh.
Why, because people don't see the world through a filter of nihilism like you? Until the universe becomes sentient, those things which the universe values don't matter one whit to me. Everything is viewed from a human perspective, and if you think otherwise, you're an idiot.
One ounce of gold is worth an ounce of gold. If you don't believe that, you're an idiot. Gold does not degrade under any but the most extreme circumstances. If you don't believe that, you're an idiot. Gold has intrinsic value as a tool of trade.
I swear, you're argument is like saying that there is no up or down because the earth is spinning around the sun which is spinning around the galaxy which is traveling through the universe. You have no perspective, and therefore your arguments are STUPID.
Please try to keep it civil. :)
Thread moved to philosophy.
teacherone
10-23-2009, 10:33 AM
Again, your post is full of contradictions. I think you are the one that doesn't understand. The theory that value is based on usefulness is a marxist idea that has been rejected by free market economists and people who believe value is subjective.
http://en.wikipedia.org/wiki/Use_value
Dude--in plain English.
When Peter Schiff says that gold has intrinsic value he is referring to specific inherent properties that gold has which are useful.
For example-- gold is used in many manufacturing processes (http://www.trustingold.com/science/frequently-asked-questions/) because of its inherent, innate, intrinsic and totally unique composition.
If people stop using gold as currency, it will still retain its intrinsic usefulness to humans and therefor it has intrinsic value.
If people stop using paper dollars, the only use they will find for them is home heating.
like this http://www.stubbycandles.com/images/Inflation-1923.jpg
That's it.
That's what intrinsic value implies.
If you don't get it by now, there's nothing else I can say.
Acala
10-23-2009, 10:48 AM
All value is subjective to the individual. How useful an object might be is a factor the individual will take into account, but it is far from the only factor. In fact, the identical object will have a different value to the same person on different days and in light of how many of the same object that person might have. If you have two identical tractors and only need one, you will sell the first (surplus) tractor for less than you would sell the second tractor that you need to run your farm. Same tractor, same person, but different situation means different value. So value is not intrinsic to the tractor. It is subjective.
However, people like Schiff who talk about the intrinsic value of gold money are speaking about the CONTRAST with paper money. What they are really saying is that gold money is itself composed of the SUBSTANCE that people value while paper money is not. Break a gold coin up into pieces and it will still have the same value. Tear up a dollar bill and it becomes worthless. This is a REAL distinction with REAL consequences. The value of gold money comes from the value people give the substance of the currency itself. The value of paper money derives from the value people give to symbolic representations on the paper. A dollar bill is valued because of its symbolic content - which can be reproduced endlessly. An ounce of gold is valued because of its substance. Symbol versus substance. Infinitely manipulatable supply versus limited supply.
So gold money does not have intrinsic value (because value exists only in the mind of each individual), but that which is valued in gold money (the gold) is intrinsic to the money. That which is valued in paper money is NOT intrinsic to the paper money. It is an abstraction.
heavenlyboy34
10-23-2009, 10:55 AM
Since man discovered money, gold has been the preferred currency. Thousands of years of history prove this.
Fire didn't have any value to man before he discovered it either.
Yet fire's value, like gold's is now intrinsic and indisputable.
This doesn't prove the intrinsic value of gold-it proves that the free market tends to favor gold. This is why I prefer a free market for money rather than a government-mandated standard.
brandon
10-23-2009, 11:04 AM
You're having an argument about semantics. Gold has value.
Gary says the meaning of the word is difficult to pin down.
Does this make Peter Schiff an idiot?
Meh.
Yea I suspect half of this debate is really about semantics. And I think the other half is that some people don't truly have a consistent understanding of free market economics.
Thread moved to philosophy.
I thought a discussion about economic theories and how they relate to gold would have been a good match for the "Economics and sound money" section...but hey, your choice.
JoshLowry
10-23-2009, 11:13 AM
I though a discussion about economic theories and how they relate to gold would have been a good match for the "Economics and sound money" section...but hey, your choice.
Maybe so, I think if topics get a bit heated then they are better off not in the public forum.
:confused:
ctiger2
10-23-2009, 11:45 AM
I actually have two ounces! I'm a big fan of gold and think it's a great store of intrinsic wealth.
Fixed! :D
teacherone
10-24-2009, 03:51 AM
This is not about semantics.
Think about it this way.
It's a post Armageddon world and chaos reigns. There is no economic system to speak of. Walking through the woods you discover two ounces of gold and two-two hundred dollar bills.
Which has value in this situation? The gold can be molded, shaped, into jewelry, dish-ware etc. Or used in a variety of manufacturing processes.
The two two-hundred dollar bills? Well, you could almost warm your hands for 10 seconds by burning them. Or you could snort a few lines.
But that's it. The gold has intrinsic value in this situation. Even if not used in currency, it can still be bartered for other necessities.
Who would trade anything for you pretty little paper pictures?
Gold's value will never go to zero because its value is intrinsic.
Paper money can and often does lose all value as central banks destroy a currency. It is then scrapped and a new currency must be devised and printed.
This can never and will never occur with gold.
tonesforjonesbones
10-24-2009, 06:59 AM
I do not see gold or really any form of money having intrinsic value. It could have just as easily been a bean or a feather. It has only the value that a person puts on it. Some guy decided that a clear rock had value...and marketed it well..and I guess diamonds are hard to come by...but it certainly doesn't have any value on its own. I guess alchemy has something to do with it..taking something and making it precious. tones
Powered by vBulletin® Version 4.2.3 Copyright © 2024 vBulletin Solutions, Inc. All rights reserved.