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

DiggerUK

drc wrote: »

......You can't eat gold .......

Wrong, you can eat gold.
It has been eaten for centuries, it was given magical medicinal properties in ancient Egypt. Bit dubious in my opinion, but each to their own.
High class restraunts today put gold leaf on all kinds of dishes. Zero nutritional value, but again, each to their own.

Difference is that the gold could all be extacted from your waste, unlike food, and recycled.
It's the durabilty of £3600 of gold that gives it the superior investment edge that £3,600 pounds of turnips just can't buy.

Now were is that site for "We buy any old crap for recycling"

diable

You can drink it, ever had GoldWasser? mmmmmmmm

diable

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.

They are greedy and only care about money and profit the worst crime was the relaxing of the controls that guaranteed farmers a fare price, wasn't it just last year that the world had its best crop of wheat ever and the price rose?

LongTermLurker

Loughton_Monkey wrote: »

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.

Damn you beat me to it!

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

And gold isn't? Gold contacts are fitted where consistent connectivity quality is required because as Masomnia says, it doesn't tarnish.

googler

Anything which is rare, in limited supply, or is no longer manufactured or available, has an elevated value.

Royal Bank of Scotland issued special commemorative £5 notes when Jack Nicklaus played his last open at St Andrews. On the face of it, these are worth no more than £5, but can sell for £20 on eBay, since they're not making them anymore.

Vintage vases by Moorcroft sell for high prices for the same reason.

However, crops can be grown and re-grown every year.

diable

LongTermLurker wrote: »

Damn you beat me to it!

And gold isn't? Gold contacts are fitted where consistent connectivity quality is required because as Masomnia says, it doesn't tarnish.

They used to use silver solder in the comms radios in tanks as I believe it was better then gold. Don't they use it in beer kegs as well?

LongTermLurker

A (vaguely) interesting comparison http://www.thecablefactory.net/silver_vs_gold.php

Loughton_Monkey

googler wrote: »

Royal Bank of Scotland issued special commemorative £5 notes when Jack Nicklaus played his last open at St Andrews. On the face of it, these are worth no more than £5, but can sell for £20 on eBay, since they're not making them anymore.

Fred Goodwin will go to any lengths to make more money. Someone should take away his PayPal account!

leahciM

diable wrote: »

They are greedy and only care about money and profit the worst crime was the relaxing of the controls that guaranteed farmers a fare price, wasn't it just last year that the world had its best crop of wheat ever and the price rose?

's kinda the point I was making

leahciM

sabretoothtigger wrote: »

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

You raise some interesting points, I do not agree. The main reason behind this being that in your concept where the farmer effectively deals in futures trading himself he is making a qualified guess on the price he will be able to get for his crops.

The issue with bank's approach to this -particularly Goldman Sachs and DB - is that the money gets so far removed from the real worth of the foodstuff that it creates a void that can only be filled with either hypothetically existing product or with more of the physical product.
The first option screws banks and therefore everyone, the second option screws farmers already under intense financial pressure.