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How does Gold work?

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The value is geologic, it's a metal which is impossible to counterfeit, people know gold, it can be confirmed to be gold and nothing else, and it is one of the rarest metals on earth.

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16 minutes ago, Dougie93 said:

To explain the value of gold, lets look at another precious metal which is also a currency, that being silver.

Silver however, is worth less than gold, why?

Silver is more plentiful, if you go to mine silver, it's easier to find and there's more of it.

Gold is valuable as currency, because it is so scarce.

 

Well, then there is platinum, but it is not widely used.

The ONLY advantage of those currencies would be their indestructibility.  You can burn them and they are still what they are.  Do not corrode either.

But again we come to the point of stored value.  That promise and "confidence".   And again, I believe the system is rigged in a way that the rats run on the treadmill chasing after IOU's, gold, cash, cryptocurrencies and whatever else bogus things some invented.

Bottom line: all of them are worthless.

What we are after is good health and happiness.  There is no currency for happiness and health.

I can choose to be happy without gold , with my dog and fishing rod.   Another guy may spend all his life running after gold and money to the detriment of his health.

 

Edited by cougar

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The other thing that made gold the universally accepted currency is that not only is it impossible to counterfeit, can't be faked, but it is also soft, easily made into different amounts, melt it down, make it into coins, bars, jewellery, whatever you please, it's transferable and flexible as to amount and shape at the same time.

Edited by Dougie93

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It's powerful.  Little bit science, little bit psychology.

 I keep some in my desk, just so I can take it out and hold it in my hand.

It's heavy.   It's substantial.

When I hold it,  I can feel the the power of it.

It's like . . . victory.

 

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21 minutes ago, Dougie93 said:

The other thing that made gold the universally accepted currency is that not only is it impossible to counterfeit, can't be faked, but it is also soft, easily made into different amounts, melt it down, make it into coins, bars, jewellery, whatever you please, it's transferable and flexible as to amount and shape at the same time.

But then banks can print their banknotes which can be used to buy gold; kind of like printing gold.  And sometimes they do not even need to print banknotes, but just digitally create cash in the system.  Lets say some weird system glitch puts $1,000,000 into my bank account.  All that changed is the figure in my account; no stacks of cash or piles of gold were involved or changed hands.

I guess I started this thread with something in mind that was bothering me, as I did not quite understand it.   This something is the piles of cash , gold, IOUs, bank account balances that are accumulated all over the world. 

If tomorrow one wants to convert all of those IOU's into food (bananas, apples, pears ...whatever) I am sure there will not be enough food on the market and in fact it might take hundreds of years to generate this amount of food.

But life continues, like those IOUs are still worth what they are supposed to be worth.

I think we live in a scam, in a bubble, where we destroy our environment and way of life over nothing.

Some royal gypsy came up with a unique plan to keep us in his control and serve him and we fell for it.

 

 

Edited by cougar

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Well indeed, most peoples money is just ones and zeros in a computer, and most people are okay with that, because they don't have much, and probably they are actually net in debt anyways, so if all the ones and zeros went away, they'd be ahead of the game.

But when you have a bit more money, say a million dollars, then ones and zeroes start to seem more dodgy.

Two bars of gold however, that really is $1,000, 000 US dollars right now, and you can hold it in your hand,  pick it up and hold $500, 000 USD and feel the power of it.

Anywhere in the world, anyone will take it, no questions asked, and give you $500,000 US for it. 

Edited by Dougie93

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See, the rich don't really trust cash.  They have some, but they don't like to be holding too much in ones and zeroes in a computer somewhere.

They buy property, equity, investments, art, fine wines, gold.

Something substantial, something that will accrue more value over time, something they can see, hold in their hands, control.

When it comes to spending, they are given credit based on the equity, so they don't need much cash on hand.

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3 minutes ago, Dougie93 said:

Two bars of gold however, that really is $1,000, 000 US dollars right now, and you can hold it in your hand,  pick it up and hold $500, 000 USD and feel the power of it.

I held those in my hand and felt nothing.  It is a bit of a problem flying with them as you will be asked to open your bags and it creates a pretty uncomfortable situation.  Then I do not feel safe any more.

What we should think about is that at some point those billions of dollars cannot be used by the person who has them.  It is a number, but one person has only one mouth and can be at only one place at a time.  So the money remains in the account and is guess what :D "useless".    Banks , I am sure, know how to take advantage of that.   There are dormant accounts too, where money is sitting and is never used.  

As I said, I believe we live in a rigged system and things are not going well, but I cannot see how I can change anything.  Nature has to take its course.

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2 minutes ago, cougar said:

I held those in my hand and felt nothing.  It is a bit of a problem flying with them as you will be asked to open your bags and it creates a pretty uncomfortable situation.  Then I do not feel safe any more.

What we should think about is that at some point those billions of dollars cannot be used by the person who has them.  It is a number, but one person has only one mouth and can be at only one place at a time.  So the money remains in the account and is guess what :D "useless".    Banks , I am sure, know how to take advantage of that.   There are dormant accounts too, where money is sitting and is never used.  

As I said, I believe we live in a rigged system and things are not going well, but I cannot see how I can change anything.  Nature has to take its course.

The rich fly around in private jets and have people to carry things for them.

Its like my cousin is worth about $60 million now, lives in a huge mansion in Newmarket, he only flies by private jet,

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5 minutes ago, Dougie93 said:

See, the rich don't really trust cash.  They have some, but they don't like to be holding too much in ones and zeroes in a computer somewhere.

They buy property, equity, investments, art, fine wines, gold.

Something substantial, something that will accrue more value over time, something they can see, hold in their hands, control.

When it comes to spending, they are given credit based on the equity, so they don't need much cash on hand.

You see...they must be thinking along my lines.  They want to have something that everyone needs  - property (space), art (what people value once they have met their basic needs).  But gold?  Give me a break.  Unless it is in the form of an ancient coin or artifact, it is worth nothing to me and it will be worth nothing in the long run.

Does gold hold the value of tiger hunting with elephants?  No.  Because there are close to no tigers left on the Planet.  It actually does not hold the value of even salmon fishing.

A story comes to mind of someone of incredible means who kind of evaded the regulations last year to catch a few fish, but was unable to do it this year.  The river was shut down again.  His money / gold could not buy him a fish.

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4 minutes ago, Dougie93 said:

The rich fly around in private jets and have people to carry things for them.

Its like my cousin is worth about $60 million now, lives in a huge mansion in Newmarket, he only flies by private jet,

I did not write that up there to put you down.  I flew some gold for someone and again, I felt nothing.  Gold or steel , all the same to me; except one carries more risk and responsibility.

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Just now, cougar said:

I did not write that up there to put you down.

Doesn't put me down, I'm not that rich, my cousin's guest house is twice the size of my house.

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1 minute ago, Dougie93 said:

Doesn't put me down, I'm not that rich, my cousin's guest house is twice the size of my house.

OK, it is probably still bigger than my house, but we are not after size; we are after happiness.  You may be happier than he is.;)

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5 minutes ago, cougar said:

OK, it is probably still bigger than my house, but we are not after size; we are after happiness.  You may be happier than he is.;)

Yeah I'm pretty happy, I just want enough so I don't have to work a job.  No J-O-B is rich enough for me.

My cousin lives in another world from me, it's surreal, his guest house is a mansion, his mansion is  like a palace. 
 

I don't really like it though, seems tacky to me, he does have an awesome car collection tho, it's more the cars which I am interested in.

Edited by Dougie93

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5 minutes ago, Dougie93 said:

Yeah I'm pretty happy, I just want enough so I don't have to work a job.  No J-O-B is rich enough for me.

My cousin lives in another world from me, it's surreal, his guest house is a mansion, his mansion is  like a palace. 
 

I don't really like it though, seems tacky to me, he does have an awesome car collection tho, it's more the cars which I am interested in.

I agree; no job is RICH!  I am not there yet, except on those occasions in the distant past when I availed of the EI program.  Good times that are not likely to come back again.

Cars shouldn't be a problem.  I am still on my first car which is now 20 years old and an embarrassment of sorts, but I can rent the latest models and drive them for a week, which I do on my short summer vacations.   I just cannot see myself putting tons of plastic in a landfill, only to create work for the Asians to make me a new car.  My vehicle has a lot of sentimental value too.   And it still goes up to 120km/h and burns 7 litters  / 100km  , so I am good.  How was that song...."Soak up the sun"   There was something useful in it....."I want what I have"  or something of that sort.:D

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Thing about my cousin is that he built a small company and then ended up selling it to a corporation for $43 million.

So he doesn't have the taste of the rich, he's like a typical suburban dude with typical suburban dude tastes, so other than the cars he doesn't spend money on anything interesting.

It's this huge palace with a bunch of junk in it, it's not like he has Picasso's on the walls.

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2 minutes ago, cougar said:

"It is not having what you want, its wanting what you got."      This was the line  - Sheryl Crow.

It's somewhat annoying tho, he has no class, like I would have bought a villa in the south of Spain and filled it with art, culture and history, but he basically just bought a giant version of the same McMansion most people buy and just filled it with the same consumer crap.

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Just now, Dougie93 said:

It's somewhat annoying tho, he has no class, like I would have bought a villa in the south of Spain and filled it with art, culture and history, but he basically just bought a giant version of the same McMansion most people buy and just filled it with the same consumer crap.

I know.  I work for rich people who do things differently and , if in their shoes, I would have made different choices.  But it is their way of life.    And sometimes our fate is to be where we are and not have all we want, but manage to smile and be happy while still making every effort to do better.

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6 minutes ago, cougar said:

I know.  I work for rich people who do things differently and , if in their shoes, I would have made different choices.  But it is their way of life.    And sometimes our fate is to be where we are and not have all we want, but manage to smile and be happy while still making every effort to do better.

Well it's like I used to have a connect which got me the use from time to time of a villa in the south of Spain, actually owned by a Spanish painter who made some money off his art, not chump change, he was rich, but not filthy rich, just an artist whose paintings sold for a lot, but it was his taste, the things he filled the house with, the way he did it up, it was amazing, it was the taste of the artist which made it richer than rich, you can't buy that, so that's my model for how to be rich.

Edited by Dougie93

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It's like my prize possessions are my trees, I've got trees on my property, I've got fur, red and green maples, birch, my whole lower yard is just trees, like a little park, and I own them.

They're my trees.  Having big sky and trees all around, that's rich.

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There are a few things about gold that are unique.

First of all, it is NOT dependent upon some currency for its real value.   Yes, you can convert it into many currencies at various market rates, but when push comes to shove, a gram of gold is a gram of gold.  As has been pointed out - it is a valuable, tangible and UNIVERSALLY accepted repository of wealth.

People are taught that wars are fought with guns and bullets.  Reality is, major conflicts depend on gold - so no self respecting banker in Geneva know for certain who is going to win, so they expect payment in gold.  Why do you think the Japanese invaded China and the US flooded it at about the same time with counterfeit USD and bonds?

The big one: is gold can not be counterfeit - or more to the point it is easy to verify.  Once again, in time of war (including the cold war) one of the top strategic weapons is to print endless amounts of your opponents currency.  You could also do just that with crypto currency.

Dougie:  while I can agree that Smoot-Hawley was one of the worst pieces of legislation the US ever passed, it is pretty much understood that the real damage was done because banks would not lend.

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On 10/19/2019 at 7:06 PM, Cannucklehead said:

https://www.google.ca/amp/s/www.cbc.ca/amp/1.4380705

 

Gold can certainly be faked.  It's a dirty, dirty business.  

Obviously, it can NOT be faked.  You can be duped into buying whatever, but that doesn't make it other than what it is - a shiny piece of something that a bank sold you.  When I walk into a bank here, I encounter someone at the till that has no idea what a bank is or how it works, never mind understanding precious metals or of course business.  You would trust them to sell gold?????

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Go to private dealers and it's the same thing.  Probably even worse.  

http://www.gold-quote.net/en/articles/fake-tungsten-gold-bars.php

 

Filled with tungsten from the u.s. treasury.  :o

 

Only way to protect yourself is to request a test upon purchase.  Costs you a bit more but you are guaranteed authenticity.  

Edited by Cannucklehead

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