Gold is pointless

Motormad

Motormad wrote: »

I have a 0.5 ounce coin but not telling you my address.

Sorry just checked and it's a 0.5 gramme,still not telling where live.

mollycat

Nearly "thanked" the OP.

Misread the thread title as "God is pointless".

eskbanker

Motormad wrote: »

Sorry just checked and it's a 0.5 gramme,still not telling where live.

Half a gram? When a penny coin weighs 3.56g, I'm struggling to visualise a coin that's a seventh of that weight, so don't think there'd be squads of bounty hunters beating a path to your door even if they knew which one it was....

shaun_from_Africa

I would hope that it's packaged something like this:
http://www.coinbazaar.in/5-gram-gold/687-coin-bazaar-bis-hallmarked-gold-coin-of-half-gram-22kt-in-916-purity-fineness-05-gm-05-gms.html
otherwise if you put it down and sneezed, you'd never see it again.

ColdIron

There's a picture of a 1 gram square at the bottom of this
https://www.hardassetsalliance.com/landing/is-there-gold-in-your-wallet

Malthusian

mollycat wrote: »

Misread the thread title as "God is pointless".

"For centuries after Buddha died, people thought they could see his shadow on the wall of a cave - a monstrous, terrifying shadow.

Gold is dead - but you know what people are like, they will see its shadows on the walls of caves for thousands of years to come. And we - we must yet conquer these shadows!"

- Fridrich Nitsche

brendon

Laycity wrote: »

You can't just print gold for starters.

Technically speaking, you can 'print' gold. Or, more accurately, synthesize gold. It just happens to cost more to synthesize gold than the market value of it. (And you'll need a nuclear reactor.)

System

Are some isotopes of gold more valuable i wonder?

ChesterDog

MatthewAinsworth wrote: »

Are some isotopes of gold more valuable i wonder?

Isotope so.

I knew I would get the chance to use that joke one day.

bowlhead99

brendon wrote: »

Technically speaking, you can 'print' gold. Or, more accurately, synthesize gold. It just happens to cost more to synthesize gold than the market value of it. (And you'll need a nuclear reactor.)

Yes, they've had that technology for over 400 years. The early version didn't need a nuclear reactor but generally had unusual results. I saw a documentary a while back in which the alchemy machine operator - Lord Percy Percy - produced a splat of what he intended to be gold but his erstwhile colleague Lord Blackadder pointed out that it was green. A nugget of purest Green, no less. Such were the rudimentary alchemic skills of the gentry of Elizabethan England.

Still, goes to show that the practice is not new. That particular documentary is over thirty years old now but it's still repeated from time to time, I recommend you catch it on Dave.

MatthewAinsworth wrote: »

I fail to see why anyone would keep it, as cash seems superior in every way - cash is a more reliable non-correlator

"Cash is a more reliable non-correlator" in this context is ballcocks. It is just some buzzword you have picked up.

People say that gold is non correlated with equities, bonds and properties because its speculative value (and potential to be an inflation hedge) can move with the whim of the market and will sometimes go up when equities or properties go up but other times go down when they go up; its price goes wherever it wants based on a variety of factors. As such it's not correlated (nor fully inversely correlated) so it can be a diversifier, albeit somewhat speculative rather than having intrinsic growth properties.

The speculators presume that people will want to hold it as an insurance policy because whatever happens to equities and global markets, someone will still be willing to spend a week's rent or several weeks' worth of food on a wedding ring in ten or twenty or thirty or fifty years, and the block of gold won't "spoil" while sitting there doing nothing in the mean time, you just need to store and insure it. And over multi decade periods they may well be right, though large losses can be realised from time to time so it's not really "safe". But a "non correlator" to act as a diversifier, sure.

Cash however does not have any real reason to grow at a pace that can keep up with inflation. So if equities go up because of money printing and QE, cash in a bank vault won't go up by materially more than inflation and deliver real growth. If equities go up because of corporate profits improving, cash in a bank vault won't go up by materially more than inflation and deliver real growth. If equities go down because of a lending crisis or a world recession, cash in a bank vault won't go up by materially more than inflation and deliver real growth.

Because, cash is crap as an agent for diversified growth. Sure, it's not correlated to markets but neither is it something that should make much of a real-terms return in any circumstances other than short term bank marketing promotions. People don't hold it for growth, or inflation protection, merely for spending. It's not an investment, just what you're left with in the absence of an investment.

So, if it's not something you're adding to your investment portfolio to hold with a view to growing your wealth, referring to it as a "better non correlator" is silly. If you hold it you are not trying to use it to provide any diversified growth. You are holding it for the opportunity to buy things, whether they be material possessions or cheap investments when available.

By contrast, the things that need to be non-correlators are the things that you are adding for growth. Good growth is growth that's non-correlated with other stuff you are also holding for growth, that's when the term "non correlated" comes into play.