Why are gold and other precious metals deemed more valuable than food stuffs?

drc

Probably a silly question but why are gold and other precious metals seen as being more valuable than food commodities such as wheat/grains etc?

You can't eat gold and it has no intrinsic value other than being rare and pretty to look at. Surely as the global population increases and demand for food goes up, that is what people should be looking to invest in?

74tnemele

You are right gold has no useful qualities it just looks nice to make things out of and has been a form of money since history began.

Silver on the other hand has those same qualities as gold and has been used as money to a greater extent but is also the best element on the periodic table for countless industrial uses.

Silver is needed in industry for electrical purposes when we run out of silver we will go back to caveman living, no more electronics.

Its also been used as an antibacterial in medical and water purifying.

The most exciting thing of late for us silver investors is silver fabric.

Its only been invented 4 years ago and now its using literally tonnes of silver every year. The 4th largest user of silver in just 4 years.

It kills bacteria so when you sweat you dont smell, I know a few people who would do well to get some

Masomnia

Is it not considered a problem that it tarnishes? Unlike gold of course.

malik999

drc wrote: »

Probably a silly question but why are gold and other precious metals seen as being more valuable than food commodities such as wheat/grains etc?

You can't eat gold and it has no intrinsic value other than being rare and pretty to look at. Surely as the global population increases and demand for food goes up, that is what people should be looking to invest in?

Limited Supply. The amount of gold left to discover/mine I suspect is no larger than the room I am sat in right now.

Wheat/grain can be grown/produced.

FYI Precious metals are used in lots of ways not just Jewellery.

74tnemele

malik999 wrote: »

Limited Supply. The amount of gold left to discover/mine I suspect is no larger than the room I am sat in right now.

Wheat/grain can be grown/produced.

FYI Precious metals are used in lots of ways not just Jewellery.

Thats right especially silver is getting depleted.

The US geological survey says by 2020 silver will be the first element on the periodic table to be depleted at the current rate of consuming it.

leahciM

As a slight aside - I think the trading of foodstuffs as a financial product is one of the worst crimes that bankers ever committed.

john_s_2

Food will increase in value (faster than other things) if there is not enough supply (aside from any arguments that there is already insufficient supply for the whole world).

You would do well to invest in food at this point. Not so much because it is increasing in value, but in order to eat.

malik999

john_s wrote: »

You would do well to invest in food at this point. Not so much because it is increasing in value, but in order to eat.

I'm off down to Tesco's now.

sabretoothtigger

supply demand same as anything else


gold supply is very limited and it costs about 400 dollars per ounce to extract even on known concentrations

food supply, anyone can grow it and sometimes it grows itself. On wasteland we have brambles and blackberrys . Cows eat grass, little effort required on that and contributes to food yields, etc
Lots of supply, not always regular but generally its not that expensive to grow food


Gold demand, investment, speculation, jewellery and luxuries. wealth preservation in uncertain times. Highest demand now as western banks fail to maintain values

food demand varies alot like the supply. You cannot not usually store large amounts of food easily as if it were wealth. Its more local because of weight. Use it or lose it.
Demand now might generally rise over decades but its very variable because it can be grown in a back garden by consumers so supply and demand can rise equally.
If you expect food values to rise you expect the percentage of the world living in cities to rise so a boring market mostly except when crops fail


Soros on gold: not safe -
http://www.reuters.com/news/video/story?videoId=158653924&videoChannel=2602

The US geological survey says by 2020 silver will be the first element on the periodic table to be depleted at the current rate of consuming it.

When you say something like that I need you to give a link to their website with that quote highlighted.

Why did Warren Buffet buy silver in the nineties and sold it a few years back

leahciM wrote: »

As a slight aside - I think the trading of foodstuffs as a financial product is one of the worst crimes that bankers ever committed.

Isnt that a bit of a cliche though. Like short selling the banks is what created their problems.

Futures contracts began with agriculture as I understand it. If your a farmer you can sell your corn harvest 6 months early to buy a tractor to actually harvest it better with.

The risk is I guess you might have a bad harvest or the price rises in those 6 months and you've lost the gains.
In theory investment and even trading is a positive and helpful to farmers, to consumers and creates wealth for many.
If the farmer doesnt get his tractor, he cant harvest as quickly or it costs him more labour to do so.
Maybe he fails to harvest before heavy rains and the crop is lost with this no one wins and wealth is destroyed in an economy

Reckless speculation especially where its corrupt is negative. The main artificial influence over all others today is government subsidies - [the largest is in banking itself I presume]

The argument you give sounds nice but it helps politics gain confidence in continuing to insist it knows better then free people in a capitalist democracy and we are all poorer for it



http://www.moneyweek.com/investment-advice/how-to-invest/would-a-short-selling-ban-prevent-another-hbos-style-panic.aspx

Loughton_Monkey

drc wrote: »

Probably a silly question but why are gold and other precious metals seen as being more valuable than food commodities such as wheat/grains etc?

You can't eat gold and it has no intrinsic value other than being rare and pretty to look at. Surely as the global population increases and demand for food goes up, that is what people should be looking to invest in?

Two years ago, I asked myself the same question. Instead of putting my £3,600 into an ISA that year, I bought 12 tons of turnips. As of last week, I still have not found a buyer, and my garage is starting to smell pretty awful.

Jonbvn

malik999 wrote: »

Limited Supply. The amount of gold left to discover/mine I suspect is no larger than the room I am sat in right now.

I hope you weren't writing this on your iphone from the Albert Hall;)