true price of gold?

[Mcgrimes]

Just now, GoldenPhil said:

I like the logic where in a world where currencies no longer have any value and you have to use PM to buy anything at all that there will be an over supply of chocolate fudge. 

In that instance, the question is: which is the currency, the gold or the fudge?

i like to imagine getting paid in fudge! Should we start a crypto where each unit is backed by a physical bar of Cadbury’s fudge? (Cheap fudge)

but, the true value of gold/fudge is what people are willing to pay for it - forget people’s estimates

[MancunianStacker]

1 hour ago, Mcgrimes said:

all prices will rise due to inflation, not just gold. This is assuming people still get paid as opposed to redundancies

Physical Gold is a useless currency, it’s not divisible and the spread is too large. Imagine trying to buy a 15p bar of fudge using gold 

‘that’ll be 0.0036g please, but we only offer 97% spot value’

 

 

That’s why I also mentioned silver earlier for general barter too.

[Frenchie]

1 hour ago, MancunianStacker said:

It was in Mike Maloney’s old book:

https://s3-us-west-2.amazonaws.com/gs-live/pdfs/GTIIGS_MikeMaloney.pdf
 

He is giving it away free! A good read no matter what you think of him (as he sells gold and silver himself).

 

There is something odd that I don't get, reading Mr Maloney :

He says, before the monetary crisis, that a pair of shoes costed 12 marks and 1oz gold value was 100marks/oz so around 1/10oz gold for a pair of shoes. 

 Then at the end ,after hyperinflation, these shoes would have cost 30 trillions marks and 1oz of gold,  87 trillions mark, so an equivallent around 1/3 oz of gold for a pair of shoes, or 3 pair of shoes for 1oz gold...

You could have bought a House for 3 oz of gold, so 9 pairs of shoes if my math is correct.

Conclusion : It seems better to invest in shoes than gold  😄

[MancunianStacker]

4 minutes ago, Frenchie said:

There is something odd that I don't get, reading Mr Maloney :

He says, before the monetary crisis, that a pair of shoes costed 12 marks and 1oz gold value was 100marks/oz so around 1/10oz gold for a pair of shoes. 

 Then at the end ,after hyperinflation, these shoes would have cost 30 trillions marks and 1oz of gold,  87 trillions mark, so an equivallent around 1/3 oz of gold for a pair of shoes, or 3 pair of shoes for 1oz gold...

You could have bought a House for 3 oz of gold, so 9 pairs of shoes if my math is correct.

Conclusion : It seems better to invest in shoes than gold  😄

I guess it was all rather crazy back then. 

[blindguy]

to me gold is a universal money. if i take say mexico peso's to india no one would take them for trade but if i travel to any country with gold i can get the local currency and be fine. i know some of you will bring up bitcoin but bitcoin is dependent on the internet and in my mind not as good as gold in hand.  jim

[BullionBuyer]

3 hours ago, Mcgrimes said:

You can exchange most metals in all countries - gold just has a higher value per unit weight than most

No you can't - have you ever tried to exchange base metal for fiat currency in another country. You can however with gold and silver which are recognised as having a store of value and being accepted as a form of money.

[Mcgrimes]

1 minute ago, BullionBuyer said:

No you can't - have you ever tried to exchange base metal for fiat currency in another country. You can however with gold and silver which are recognised as having a store of value and being accepted as a form of money.

I’ve never tried to exchange metals for money in another country, but I assure you that scrap yards exist internationally.

My point is that just because you admire gold, doesn’t give it magical properties amongst other stores of value. 

Id argue the only universal currency is the US Dollar as it is recognised pretty much everywhere. You can take it to most countries and exchange it for gold, oil and even their local fiat. I bet you’d get a better spread as well

[silenceissilver]

2 hours ago, Mcgrimes said:

In times like this, investors may flock to gold pushing its value even higher - I think there will be?

Gold prices would likely fall it everyone loses their job and has to dip into savings, whether this is cash savings, stock investments or physical assets

You are talking about a deflation. We have seen what you describe already (not the end of deflation but people selling gold for liquidity). I'm talking about the next stage of the crisis, the hyperinflation.

[silenceissilver]

9 minutes ago, Mcgrimes said:

My point is that just because you admire gold, doesn’t give it magical properties amongst other stores of value.

We have all thought about swapping our gold for iron, at some point, given the unparalleled iron to gold ratio.

[MancunianStacker]

The topic is the true price of gold, so that would be whatever price (in fiat or fudge) someone is willing to pay at the time and what the seller will accept. The time is all important too.
 

You can offer me all the fudge in the world right now but I might not want any. In the future I might change my mind.

Wonder what would happen if a mine wouldn’t take dollars for gold, instead exchanging gold for fuel to mine more. Maybe buy more dozers with gold too. The dollar is getting squeezed out all around the world and it may well get squeezed out within the USA in certain circumstances.

Anything can and will eventually happen. 

[MancunianStacker]

24 minutes ago, Mcgrimes said:

My point is that just because you admire gold, doesn’t give it magical properties amongst other stores of value. 

Id argue the only universal currency is the US Dollar

The US Dollar has been the world reserve currency for a long time and yes the margins are better at most BDCs around the world but it is still Fiat currency. It doesn’t store value. In fact it loses value every day it isn’t spent.

Gold/Silver are stores of value in that they cannot be created out of thin air and there is also a finite amount of them in the Earth. A similar thing can be said for BitCoin but the problem with crypto’s is that anyone can create a new Crypto at any time and also create as many coins as they like at ICO stage and make themselves Billionaires over night.

[Mcgrimes]

3 minutes ago, MancunianStacker said:

The US Dollar has been the world reserve currency for a long time and yes the margins are better at most BDCs around the world but it is still Fiat currency. It doesn’t store value. In fact it loses value every day it isn’t spent.

Gold/Silver are stores of value in that they cannot be created out of thin air and there is also a finite amount of them in the Earth. A similar thing can be said for BitCoin but the problem with crypto’s is that anyone can create a new Crypto at any time and also create as many coins as they like at ICO stage and make themselves Billionaires over night.

Exactly my point - USD is a currency, gold is a store of wealth.

People here claim gold is a currency purely to promote it and validate their own ideology. Yes, you can barter with gold just as you can with any asset, but it isn’t a currency; it once was, however.

Cue people posting links to websites claiming it’s a ‘kind of’ currency. 

Bitcoin as a store of wealth is a non-sense; something that volatile is the opposite of wealth.
 

[MancunianStacker]

1 minute ago, Mcgrimes said:

Exactly my point - USD is a currency, gold is a store of wealth.

People here claim gold is a currency purely to promote it and validate their own ideology. Yes, you can barter with gold just as you can with any asset, but it isn’t a currency; it once was, however.

Cue people posting links to websites claiming it’s a ‘kind of’ currency. 

Bitcoin as a store of wealth is a non-sense; something that volatile is the opposite of wealth.
 

Ah, I’m with you now. 👍🏻 

[blindguy]

i went to canada this last summer and canada had a limit on how much U.S. currency i could bring across the boarder. do other countries have limits on how much currency you can bring in to them?

[BullionBuyer]

26 minutes ago, Mcgrimes said:

I’ve never tried to exchange metals for money in another country, but I assure you that scrap yards exist internationally.

My point is that just because you admire gold, doesn’t give it magical properties amongst other stores of value. 

Id argue the only universal currency is the US Dollar as it is recognised pretty much everywhere. You can take it to most countries and exchange it for gold, oil and even their local fiat. I bet you’d get a better spread as well

I don't know of many other things, other than gold,  that can still have a store of value after 2000 years and where the real value of that has been maintained. Surely it is this property that makes gold 'magical' over all other metals.

The USD is a fiat currency that has lost 95% of its real value over the past 100 years or so. Only gold has maintained its real value over this time. 

 

[GoldenPhil]

6 minutes ago, blindguy said:

i went to canada this last summer and canada had a limit on how much U.S. currency i could bring across the boarder. do other countries have limits on how much currency you can bring in to them?

Yes almost all. I am very well traveled and there are always limits. 

[HawkHybrid]

22 minutes ago, MancunianStacker said:

The dollar is getting squeezed out all around the world and it may well get squeezed out within the USA in certain circumstances.

who keeps on circulating these rumours?

the last time I checked, the majority of world assets by value

was denominated in usd.

25 minutes ago, MancunianStacker said:

Wonder what would happen if a mine wouldn’t take dollars for gold, instead exchanging gold for fuel to mine more.

that mining company would probably make the headlines for

being awkward.

 

HH

[MancunianStacker]

6 minutes ago, HawkHybrid said:

who keeps on circulating these rumours?

the last time I checked, the majority of world assets by value

was denominated in usd.

that mining company would probably make the headlines for

being awkward.

 

HH

- Because USD is still (currently) the world reserve currency but every 40 or so years that generally changes.

- My mining company might be awkward. I’d probably cut out the middle men and sell the gold dust by various size & weight direct to the public too. If I wanted fiat. 

[Mcgrimes]

30 minutes ago, BullionBuyer said:

I don't know of many other things, other than gold,  that can still have a store of value after 2000 years and where the real value of that has been maintained. Surely it is this property that makes gold 'magical' over all other metals.

The USD is a fiat currency that has lost 95% of its real value over the past 100 years or so. Only gold has maintained its real value over this time. 

 

I think I need some figures to back what you are saying, especially when it comes to ‘true value’. Please look at other metals as well

Don't forget about land/property as a store of value.

[HawkHybrid]

7 minutes ago, MancunianStacker said:

Because USD is still (currently) the world reserve currency but every 40 or so years that generally changes.

 how is guessing a verification that a currency is getting squeezed

out?

currently the usd is more in demand than supply can handle. that's

why we have deflation. that's why more dollars needs to be made

available for circulation. this is currently happening, not the opposite.

 

HH

[MancunianStacker]

25 minutes ago, HawkHybrid said:

 how is guessing a verification that a currency is getting squeezed

out?

currently the usd is more in demand than supply can handle. that's

why we have deflation. that's why more dollars needs to be made

available for circulation. this is currently happening, not the opposite.

 

HH

Plenty of countries choosing not deal in the dollar. Well the ones big enough to defend themselves from the US Forces (China and Russia, maybe Iran). Gaddafi & Sadam tried it but soon ended up dead.

I see the USD’s world rule ending soon but time will tell.

I feel the demand for the USD is greatest within the US itself since the world economy has gone down the swannie and QE infinity started. Trying to prop up the economy until the election and directly buying up its own companies stocks plus keeping people in jobs (they aren’t alone in doing this either).

They do just need to be the strongest fiat currency at any one time to keep their status. 

Edited April 10, 2020 by MancunianStacker

[HawkHybrid]

14 minutes ago, MancunianStacker said:

Plenty of countries choosing not deal in the dollar. Well the ones big enough to defend themselves from the US Forces (China and Russia, maybe Iran).

https://ustr.gov/countries-regions/china-mongolia-taiwan/peoples-republic-china

dated 2018, china is trading with america to the value of over

$600 billion. at least for now, china is still choosing to deal in

the dollar.

 

HH

[GoldenPhil]

4 minutes ago, HawkHybrid said:

https://ustr.gov/countries-regions/china-mongolia-taiwan/peoples-republic-china

dated 2018, china is trading with america to the value of over

$600 billion. at least for now, china is still choosing to deal in

the dollar.

 

HH

There is a deal between Russia and China to trade between themselves in their own currencies only. 

[HawkHybrid]

16 minutes ago, GoldenPhil said:

There is a deal between Russia and China to trade between themselves in their own currencies only. 

https://www.rt.com/business/448783-russia-china-trade-turnover/

to the value of over $100 billion(2019). in global value terms,

china is not exactly giving up on the dollar?

 

HH

[Martlet]

37 minutes ago, HawkHybrid said:

https://www.rt.com/business/448783-russia-china-trade-turnover/

to the value of over $100 billion(2019). in global value terms,

china is not exactly giving up on the dollar?

 

HH

Trades are put into $ values for reference, most people know what their currency to $ is worth, but not a clue what the Ruble or Yuan are valued at.  Some times trades can be shipments of goods exchanged like large scale barter. 

Edited April 10, 2020 by Martlet