What if gold was to become worthless?

[Scuzzle]

They can't make it worthless but they can create conditions so that you give it up voluntarily.  Look at all the Cash For Gold shops that sprung up after the 2008 crisis and how many people must have offloaded what little gold they held.  Where are they all now and if another crisis happened would Cash For Silver shops spring up because not enough people have any gold as they got most of it last time?

[RacerCool]

Governments can declare something to be illegal, but they can't actually remove its value.

[tallyhojim]

1 hour ago, ittle5huggy said:

i.e. a near extinction event then when no FIAT available use yer gold to buy a Gun lathe.

Corrected it for you 😉.

[tallyhojim]

24 minutes ago, RacerCool said:

Governments can declare something to be illegal, but they can't actually remove its value.

And said value would almost instantly skyrocket. Prohibition and criminalisation always makes things more desirable.

[KDave]

What makes gold valuable in the first place is a better question OP, then you can decide if those factors and attributes that gold possesses can be applied to other assets or goods.

The answer I have found is many of said attributes can be applied to other goods/assets, but not all of them. Some elements and electronic products come very close to being as good as gold, but still not quite, but the difference between 'good' and 'not quite' is vast in regards to value. 

[ittle5huggy]

22 minutes ago, tallyhojim said:

Corrected it for you 😉.

Ta 😙

[verorl]

4 hours ago, Zhorro said:

I suppose that if a gold mine was found with unlimited amounts of gold, this would have the potential to make gold worthless (or just worth a fraction of its current value).  But would we be told?  Or would the price just be managed to gradually go down over time? 

I think the powers in charge would implement a DeBeers type cartel to control gold supply to increase demand. I have heard on a lot of places that diamonds are not rare, yet as DeBeers controls most of the "output" and availability, they can maintain the astronomical prices. 

The shiny yellow stuff has been considered "precious" since the beginning of time. People love it and are mesmerized by it. Even if it was deemed worthless, people would still want to own some, which would make gold retain some value. Well, that is what I think anyway.

[TopHatsTales]

9 hours ago, Scuzzle said:

They can't make it worthless but they can create conditions so that you give it up voluntarily.  Look at all the Cash For Gold shops that sprung up after the 2008 crisis and how many people must have offloaded what little gold they held.  Where are they all now and if another crisis happened would Cash For Silver shops spring up because not enough people have any gold as they got most of it last time?

Was thinking this myself....

Then yesterday I saw an advert for cash for gold on Facebook feed. First time I recall seeing one in years.

[sixgun]

15 hours ago, Safestacker said:

Where does the gold price and worth come from? (Also silver)

The price currently comes from the paper markets - COMEX and the LBMA OTC markets. The paper market is increasingly influenced by the physical markets - however much paper there is there are always some who want the physical, so the paper market cannot run unfettered - there must always be enough physical at around the paper price for price to be manipulated - this is why it is a game of psychology -  to put a downer on gold - if everyone wanted gold the price would be many time higher than today. Silver has many industrial uses so worth comes from the usefulness of silver.

15 hours ago, Safestacker said:

Considering this, what if the government or powers that be declared gold/silver worthless and stopped using it to back money

Fiat isn't backed by gold/silver. Nixon took the dollar of the gold standard and with it the rest of the world.

What government? Many governments have been buying large amounts of gold (and silver) - why would they declare it worthless? Does the government price gold anyway - they work to control price but they do not exclusively price these metal. Silver cannot be worthless as it has valuable uses.

15 hours ago, Safestacker said:

...what if the government....put all their backing into fiat or digital cashless currency moving forward?

Other than the US Treasury, central banks hold foreign reserves - so they do 'back' their currencies with other fiat. It is a House of Cards as all fiat is devaluing which is why all fiat is devaluing. They cannot resist endlessly printing more currency.

15 hours ago, Safestacker said:

Would dealers then stop buying and selling? Because essentially it’s worthless.

No gold/silver are not worthless - even if central banks stopped buying gold, the people would buy it. The people of the world - especially in places like India, they hold tremendous amounts of gold. It is in the blood. People want gold jewelry especially in Asia. There is demand so gold will not become worthless. It hasn't been worthless in thousands of years and it certainly isn't going to start now.

15 hours ago, Safestacker said:

Would this then make all of our gold stacks worthless?

No - gold isn't going to be worthless - this is not normalcy bias - if anything the case for physical assets like gold gets stronger by the day. Demand is rising, so the price rises.

15 hours ago, Safestacker said:

it can be manipulated to go up and down so surely it can be manipulated into being worth nothing if they chose to?

The 'government' does not have limitless power - there was fixing of the gold price - the currency was so much gold, so, so much gold was a certain price. But too much currency was printed and people recognised this. The French recognised the US was printing too many dollars and so the French demanded gold. The USD as a result came off the gold standard - there were too many dollars and not enough gold. Since then fiat has gone to rat sh1t. Its value has moved inexorably down. 

There have been many attempts to manage the price of gold. They have all failed. Gold cannot be manipulated to zero value. Paper gold can be sent to low levels in a mad spike of price but physical can't. No-one here will sell their coins for nothing so the price can never be zero.

15 hours ago, Safestacker said:

Also, following this, they make barter illegal and so no dealers would be able to buy and sell gold ? 

Governments could make gold 'illegal' - it would go underground. Gold has been 'illegal' or there were limits on the amount a person could legally hold - this existed in the UK following WWII - it was in effect in the UK for example "a 1966 amendment to the Exchange Control Act, 1947, which made it illegal for UK residents to continue to hold more than four gold coins dated after 1817, or to buy any gold coins unless they applied for and were granted a collectors licence from the Bank of England." https://www.chards.co.uk/blog/gold-market/31

Questions in Parliament at the time showed these restrictions were a bit of a joke when it was asked how much gold the authorities had confiscated. It was very little - the law was not being applied. People were not giving up their gold. 

But why confiscate gold if it has no value? It has value and this is why governments seek to manage the price and deprive the people of real money through unlawful legislation which persecutes the people.

Gold won't go to zero - is anyone forced to spend time on the silver forum? Force to buy gold and silver coins? Precious metal is called precious b/c it is.

[Au79]

If gold is what it is, we are unable to deny its existence and characteristics. And for that, it is worth what it is worth.

Gold’s characteristics has been proven to be of value to men for centuries. And for its uses and importance to men, it is worth the price men pays for.

For the collective of merchants who has decided gold a commodity for profit, a market is created with the use of greed and fear through numbers. Men chase the number (price) given to gold.

What if, is just men’s imagination run wild, building on men’s past experience of memories.

Air is worthy of men, yet everyone breathes without paying.

[5huggy]

On 19/09/2019 at 23:27, verorl said:

yet as DeBeers controls most of the "output" and availability, they can maintain the astronomical prices. 

Central banks  - to a degree  - -do just this!

Despite the fact that most of the time they call GOLD a "pet rock" , a "useless asset" , I personally wonder  - - "Then WTF do they keep buying it and storing it!

Why not by COW DUNG!  😉🤣

[Derv]

If something has a use then surely by its existence it has value. Add a use - a value has been added.

Re - cow dung - in some cultures it does have value , composted , dried and used for fuel - burning . 

Everything truly has a use , if it can be worked = adding value !

[ittle5huggy]

On 20/09/2019 at 08:52, sixgun said:

Governments could make gold 'illegal' - it would go underground. Gold has been 'illegal' or there were limits on the amount a person could legally hold - this existed in the UK following WWII - it was in effect in the UK for example "a 1966 amendment to the Exchange Control Act, 1947, which made it illegal for UK residents to continue to hold more than four gold coins dated after 1817, or to buy any gold coins unless they applied for and were granted a collectors licence from the Bank of England." https://www.chards.co.uk/blog/gold-market/31

Episode of Dads army covered this quite well.... 🤣 it was in effect during WWII.... only way we could buy stuff from the Americans

[verorl]

9 hours ago, 5huggy said:

Why not by COW DUNG!  😉🤣

My family has a cattle ranch... Maybe we could become millionaires marketing cow dung!!! 

*starts hatching plan*

[5huggy]

2 hours ago, verorl said:

My family has a cattle ranch... Maybe we could become millionaires marketing cow dung!!! 

*starts hatching plan*

Methane when burnt = CO2 amd H2O and NOTHING ELSE 

 We have a company in the UK that IS growing - based around Farms (cattle) - its called "ANAEROBIC DIGESTION" -

I have built 3 phase power supplies (for the company I worked for until May this year)  -

mini substation of 6000amp size for this methodology and company

DYOR buddy - its the way forward IMHO!!!

the resultant waste BTW - is still fertiliser for the agricultural/arable

BURT WERT DUZ AYE NO!😉

[DarkChameleon]

6 hours ago, 5huggy said:

Methane when burnt = CO2 amd H2O and NOTHING ELSE 

 We have a company in the UK that IS growing - based around Farms (cattle) - its called "ANAEROBIC DIGESTION" -

I have built 3 phase power supplies (for the company I worked for until May this year)  -

mini substation of 6000amp size for this methodology and company

DYOR buddy - its the way forward IMHO!!!

the resultant waste BTW - is still fertiliser for the agricultural/arable

BURT WERT DUZ AYE NO!😉

They cant be that good if you don't work for them any more.

[5huggy]

Doh! Ive not got that across properly!

the company I DID work for,   made the PSU!  for The "ANAEROBIC DIGESTION" - entity /company 

[DarkChameleon]

8 minutes ago, 5huggy said:

Doh! Ive not got that across properly!

the company I DID work for,   made the PSU!  for The "ANAEROBIC DIGESTION" - entity /company 

So the company that supplies them isn't that good?...got it.

[5huggy]

4 hours ago, DarkChameleon said:

So the company that supplies them isn't that good?...got it.

RIGHT on! 😉  Thats why I left!