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Gold strategy in the current economy


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HOLA441

There is only one demand in the gold market, and that's buying physical. There is no information transmission mechanism other than price and volume. No tickbox surveys as to whether the demand is organic, inorganic, or semanti*****.

When Injin bought his gold, that was demand, the same demand as that of e.g. the most rabid of goldbugs, or a Chinese central banker. The market knows no different. They all played an equally important role (proportional to the volume of their demand) in tripling the price, validating gold as (a progression towards becoming more like) money, etc.

As an unusual subset of the people who demand gold, I wonder how much new non-goldbug demand Injin has encouraged with his assertion that 10% of your assets in gold is a good idea.

Gold demand proponents come in the strangest forms!

Like I said, the point of view you present considers fraud the same as honest trade, rape the same as making love and contends that kidnap is the same as a family day at the seaside.

Doesn't matter why if the action is the same, right?

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HOLA442

Like I said, the point of view you present considers fraud the same as honest trade, rape the same as making love and contends that kidnap is the same as a family day at the seaside.

Much ridiculousness.

Doesn't matter why if the action is the same, right?

To the market, no. You are the demand.

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HOLA443

Very well put.

The whole point of following mises understanding of what money is and where it comes from is that it becomes clear that process is everything.

People may freely choose gold. They may choose wheat. And after a time, they may change their mind and choose something new. What's important is they get to choose, not what they choose.

To claim that gold is money is to look at the accumulated decisions of 6 billion human beings and say you can short cut them - that' s 6 billion other human beings living their lives and making their choices but bugs can tell them all gold is money because bugs know better than they do. Has to be balls.

agree. the key point is that a mass of people get to choose the most marketable commodity depending on the market at any one time. just because we are used to money being unchanged for long periods, i dont think that means that will be true forever. with current populations if FIAT collapsed i see the unrest affecting the market in a way that rice/bullets/clean water/medicine would be worth far more than a gold sovereign AT THAT POINT IN TIME. if what money is changes rapidly then that is very similar to resorting to barter is it not?

ive also had a thought, gold bulls tend to think that because history has said gold is money for 1000 years then this means that the future will follow suit. thats a big assumption. think of this scenario.

1900s rewind....a few men held the vast majority of the gold didnt they? i reckon they realised that when they eventually owned nearly all the gold in the marketplace, the masses didnt have hardly any.(common sense)

at this point a few things can happen. the free market realises they have no gold and will struggle to buy anything. But they need to trade for items they need so start BARTERING and swopping goods with one another bypassing the gold (it makes sense as they dont have any!). this would be bad for the few rich men as they lose their wealth overnight as the free market has decided gold is worth jack all to them. if the few rich men were smart they would buy just enough rubbish that the free market produces so that enough gold circulates to keep the masses happy and keep gold as money. maybe thats why they wanted off the gold standard and the fed was introduced? just got me thinking.

the point is, is that even if fiat hadnt been forced upon the market, maybe gold wouldnt actually be money today. its too easy to assume it would be.

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HOLA444
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HOLA445
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HOLA446

This video was posted on Max Kieser. http://www.youtube.com/watch?v=M5UqIc6z8iE

Real people, real life and real facts.

Your 'theoritical truth' makes no difference in the 'real' world.

At no point did I say there was any organic demand for paper money.

What money is is not a binary proposition - the "if not paper then must be gold" meme is one of the more worthless pieces of thinking in economics. Money could be quite literally anything.

All that matters for a functioning economy is that it is freely chosen.

And once, more, this is not some dovorced from reality mere theory, the definition of money I have used here is an observation of actual practice which has then been codified and put on paper by von mises. You can see money spontaneously appear wherever people congregate, it's an observable phenomenon.

But, no, I understand, killerbee. You and max kaiser can make the buying decisions for 6 billion other humans because you are just that damn smart. They don't need to make their own decisions, you can do it for them. What time is your inauguration, mr president?

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HOLA447

All that matters for a functioning economy is that it is freely chosen.

Agree. And if you removed all forms of fiat money/government intervention and left people to choose, I'm prepared to bet that gold/silver would play some part as money in 90% of the places on earth.

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HOLA448
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HOLA449
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HOLA4410
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HOLA4411
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HOLA4412

Not really. It could be anything, but all of human history shows that several particular things are used more often than not.

but history doesnt mean things will be the same in the future.things do change. who would have thought in 1800s that money would be paper and numbers on a computer not backed by gold/silver at all. im sure a victorian would have cracked up with laughter at the suggestion. or if you had told a roman that money wasnt a gold/silver coin but a piece of paper they would have laughed also. maybe in the future if money is something we cant forsee now, then we would be the ones laughing at such seemingly ludicrous suggestions about what money is in the future.

i dont disagree that gold may become money or linked somehow to it, it wouldnt surprise me at all. but to say that because it has been money for a thousand years then it will always be money is a bit too big of an assumption for me, especially when you consider the conniving forceful manipulation and force used by govts and TPTB.

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HOLA4413

but history doesnt mean things will be the same in the future.things do change. who would have thought in 1800s that money would be paper and numbers on a computer not backed by gold/silver at all. im sure a victorian would have cracked up with laughter at the suggestion. or if you had told a roman that money wasnt a gold/silver coin but a piece of paper they would have laughed also. maybe in the future if money is something we cant forsee now, then we would be the ones laughing at such seemingly ludicrous suggestions about what money is in the future.

i dont disagree that gold may become money or linked somehow to it, it wouldnt surprise me at all. but to say that because it has been money for a thousand years then it will always be money is a bit too big of an assumption for me, especially when you consider the conniving forceful manipulation and force used by govts and TPTB.

Not just that, but he's wrong about gold anyway.

If money is the most commonly used commodity in an economy, money has generally previously been silver or copper.

but to go back to my printer ik example and flesh it out - monetary metals were so because people could take weights of the material and do things with it. Gold could become a ring, copper some pots and pans and so on. I don't see many people off down to the blacksmiths these days, do you

On the other hand - printer ink is -

Divisible.

Expensive.

In high demand.

Storable for a long time.

etc etc

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HOLA4414

Not just that, but he's wrong about gold anyway.

If money is the most commonly used commodity in an economy, money has generally previously been silver or copper.

but to go back to my printer ik example and flesh it out - monetary metals were so because people could take weights of the material and do things with it. Gold could become a ring, copper some pots and pans and so on. I don't see many people off down to the blacksmiths these days, do you

On the other hand - printer ink is -

Divisible.

Expensive.

In high demand.

Storable for a long time.

etc etc

Yes, but you bought gold, didn't you Injin. You didn't stack ink cartridges.

Your position seems odd. You:

- became part of the demand by buying gold

- advocate holding 10% of assets in gold

- have said numerous times that buyers of gold will profit

When talking about gold demand, there is but one demand that matters; buying the stuff. Gold demand only has any relevance within the gold market - the only place that gold demand and supply meet. Everything else is semantiw@nk.

Let's say that there is a reader here who listens to you, and has followed your advice & example - that theoretical person would have bought gold. The only effect that you can have had on gold demand is to increase it.

You are the demand.

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HOLA4415

Yes, but you bought gold, didn't you Injin. You didn't stack ink cartridges.

Your position seems odd. You:

- became part of the demand by buying gold

- advocate holding 10% of assets in gold

- have said numerous times that buyers of gold will profit

When talking about gold demand, there is but one demand that matters; buying the stuff. Gold demand only has any relevance within the gold market - the only place that gold demand and supply meet. Everything else is semantiw@nk.

Let's say that there is a reader here who listens to you, and has followed your advice & example - that theoretical person would have bought gold. The only effect that you can have had on gold demand is to increase it.

You are the demand.

I've already explained my reasoning and even admitted it goes against my personal philosophy.

I've also explained why you are in favour of rape, which didn't bother you in the slightest. Bit crazy, ain't cha?

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HOLA4416

I've already explained my reasoning and even admitted it goes against my personal philosophy.

I've also explained why you are in favour of rape, which didn't bother you in the slightest. Bit crazy, ain't cha?

Your relating your own gold demand to rape is too ridiculous to respond to.

You are the demand.

Prove me wrong; put your money where your mouth is; sell your gold.

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HOLA4417

Your relating your own gold demand to rape is too ridiculous to respond to.

No, I outlined why you not caring about why people want to do something means that rape is the same to you as making love.

You are the demand.

No, i am not. Whoever I pawn this wortless crap off to in the end is the demand.

Prove me wrong; put your money where your mouth is; sell your gold.

As already explained, it's not organic demand. I have no interest in gold at all.

Gold is insurance against the fact that the rest of humanity isn't very rational.

Bubble stuff, as already explained.

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HOLA4418

No, I outlined why you not caring about why people want to do something means that rape is the same to you as making love.

More ridiculousness.

No, i am not. Whoever I pawn this wortless crap off to in the end is the demand.

By playing your part in the bubble, you are the demand.

As already explained, it's not organic demand. I have no interest in gold at all.

Apart from buying the stuff :rolleyes:

Gold is insurance against the fact that the rest of humanity isn't very rational.

Bubble stuff, as already explained.

The market doesn't care why you demanded it.

You are the demand.

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HOLA4419

More ridiculousness.

no, factually accurate. If you don't care why someone is doing something then you don't care if they are being coerced or if they are doing it off their own free will. Simple logic, you are suject to.

By playing your part in the bubble, you are the demand.

If you are lumping demand into one big ball and leaving out reasons then why, yes I am. But only a ******ing idiot would do that.

Apart from buying the stuff :rolleyes:

The market doesn't care why you demanded it.

You are the demand.

Completely and utterly wrong.

The market ONLY cares why something is demanded. It's called a price signal.

Freely chosen, rational price signals give market participants the best information and make for the best economies. Forced, fraudulent or mythological purchases give much faulty signals and ruin economies.

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HOLA4420

no, factually accurate. If you don't care why someone is doing something then you don't care if they are being coerced or if they are doing it off their own free will. Simple logic, you are suject to.

It's very simple. I'm saying that the market doesn't care why you demand gold; only that you do.

If you are lumping demand into one big ball and leaving out reasons then why, yes I am. But only a ******ing idiot would do that.

No, the gold market does that.

Completely and utterly wrong.

The market ONLY cares why something is demanded. It's called a price signal.

Bingo.

Freely chosen, rational price signals give market participants the best information and make for the best economies. Forced, fraudulent or mythological purchases give much faulty signals and ruin economies.

I'm guessing that you feel that your demand for gold was forced, rather than fraudulent?

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HOLA4421

It's very simple. I'm saying that the market doesn't care why you demand gold; only that you do.

And you are wrong.

No, the gold market does that.

No, it doesn't.

Bingo.

So you agree, it matters why people want something. Great, you agree that gold is a bubble.

I'm guessing that you feel that your demand for gold was forced, rather than fraudulent?

No, it's a fraud. Gold is worthless to people - even to those who are really into it because they've made a massive thinking error. Almost wveryone is passing it on to someone else who wants to pass it on. Very little organic demand.

Whoever gets my gold in the end will almost certainly be under a series of stupid delusions about what they have got. I don't like it, but as I said if everyone else was rational i'd have the luxury of not needing to play defensively against nutters and fools. Hey ho, it is what it is. (I also pointed out the problem of ones financial self interest being in the opposite direction to rationality and common sense and the corrosive effect it has.)

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HOLA4422
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HOLA4424

Except for the fact that you swapped your own money to buy it.

Already stated why - because at some point if TSHTF I'll be able to pass it onto someone else (who also doesn't want gold) it;s a big comedy circle jerk bubble.

It's not actual, organic demand.

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HOLA4425

Already stated why - because at some point if TSHTF I'll be able to pass it onto someone else (who also doesn't want gold) it;s a big comedy circle jerk bubble.

It's not actual, organic demand.

Endless semantiwa@nk. Buying is demand. You are (currently) the demand.

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