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Author Topic: Did gold ever drop to worthless?  (Read 5662 times)
westkybitcoins
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June 10, 2011, 01:11:31 PM
 #21


Gold is pretty much worthless as a commodity.  Gold is the most irrational commodity that humans trade.  It has no use other than it's shiny and it's perception of value.  Only a true idiot would believe gold has any meaning or value.  It is a business though and a very profitable one.  Where profit exists, money will follow.

This is just flat-out false. Gold's chemical, electrical, and even some of its physical properties make it such that its rarity is the only thing keeping humans from using it in a variety of ways on a daily basis.

If gold were as common as dirt, it would be coating our flatware; inside our electronics (much more so than now!); adorning our books, paintings and clothing; inside our bodies (teeth, metal plates and rods, etc.); within most places of manufacture; and would just generally be the second most-used metal next to iron.

Gold's intrinsic value is why it became desirous enough to start being used as money in the first place.

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The idea that deflation causes hoarding (to any problematic degree) is a lie used to justify theft of value from your savings.
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June 10, 2011, 01:31:33 PM
 #22

The question to ask is what happened to gold prices in periods/places where its possession was forbidden.
For ex., I know that in the 30s in the US, the government forbid the possession of gold. But I've never seen an analysis of whatever happened to its price.

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June 10, 2011, 02:14:42 PM
 #23

The question to ask is what happened to gold prices in periods/places where its possession was forbidden.
For ex., I know that in the 30s in the US, the government forbid the possession of gold. But I've never seen an analysis of whatever happened to its price.

During the FDR gold confiscation, the government paid people a fixed price of $20.67 per ounce, then shortly afterwards repriced it to $35.00. (Don't quote me on those prices. I'm going by memory.)

Gold standards work, especially one's that use free bills of credit and/or a mechanism that utilizes floating 100% convertible physical prices. But fixing the price of gold, like any kind of price fixing, inevitably is unsustainable.

What frustrated the US government is that ALMOST NO ONE turned in their gold.

In the 70's, I think during the Ford administration, ownership of gold was once again allowed. Krugerrands were the choice coin at the time.
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June 10, 2011, 02:34:28 PM
 #24

I wonder about the history of gold. When it was new, it was only used for cheap jewelry, since you can't create tools with it. Then people somehow decided that it was valuable.

My question is, was there ever a time in human history, when everyone decided "Well, gold is not really worth anything!"? Of course, the value of gold fluctuates a bit, but was there ever a drop to zero? Why, why not?

Obviously the value of gold has dropped to zero for certain people. If you were in a sinking boat and you had to dump the gold overboard or drown, you'd dump it. It would actually have a negative value in that circumstance. Similarly Bitcoin value can go negative as well. If you were unable to trade with it for whatever reason and a stiff legal penalty was the result of possession, then you'd crush and flush your thumb drive.

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June 11, 2011, 04:43:38 PM
 #25

What frustrated the US government is that ALMOST NO ONE turned in their gold.

wow...civil disobedience for the win.

"We will not find a solution to political problems in cryptography, but we can win a major battle in the arms race and gain a new territory of freedom for several years.

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June 11, 2011, 05:40:36 PM
 #26

The US can't confiscate anything at MtGox. MtGox is based in Japan.

um we wrote their constitution. I bet we could "convince" them.

I dont like the guy. How many reasons do I have? alot.
How many reasons do I need? none.
I just dont like the guy.

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June 11, 2011, 06:02:45 PM
 #27

After Gold hit $800/ounce in the 1980s it fell over time to under $200/ounce at or around 1999. Silver fell from somewhere like $50/ounce to under $4/ounce. It's all relative, though. You really shouldn't look at Bitcoins as an investment, you should look at it as an online currency. Buy what you want to use and be done with it. If you're looking for an investment vehicle you're only going to end up disappointed in the long run.

That being said, I think Bitcoin will crash down to current levels at some point in the far future after it's already risen well past $100/coin.

Of course, if the US made it illegal or confiscated all coin/dollars at MtGox it would be a huge blow. We'd see $2-$4/coin essentially overnight.

At this point bitcoin is a stock like it or not. People are going to buy into it at this point because they believe there is the potential to make money. Looking at it as an online currency does nothing if I know the value isn't going to rise over the next 5 years especially when mining difficulty thus far has been almost exponential. And if I'm correct MtGox is a Japaneese run company, so I doubt US or Japan for that matter will do a thing to them.

Gold is pretty much worthless as a commodity.  Gold is the most irrational commodity that humans trade.  It has no use other than it's shiny and it's perception of value.  Only a true idiot would believe gold has any meaning or value.  It is a business though and a very profitable one.  Where profit exists, money will follow.

This is just flat-out false. Gold's chemical, electrical, and even some of its physical properties make it such that its rarity is the only thing keeping humans from using it in a variety of ways on a daily basis.

If gold were as common as dirt, it would be coating our flatware; inside our electronics (much more so than now!); adorning our books, paintings and clothing; inside our bodies (teeth, metal plates and rods, etc.); within most places of manufacture; and would just generally be the second most-used metal next to iron.

Gold's intrinsic value is why it became desirous enough to start being used as money in the first place.

To be honest gold really is only valued for its shininess and density. Gold has, and always will be out of reach to industries for its massive cost. Silver is a much better conductor, although it has oxidizing properties so they use gold where they cannot use solder mask ie. Connecting chips such as RAM / CPU's. However the amount of gold used for these processes is only about 5-6% of the mined supply. That leaves about 70-80% for jewlery, and the rest being investments. Clearly nearly 90-95% of it's value comes from its "Shininess", and a weak dollar/ hedge against inflation.

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June 11, 2011, 07:45:37 PM
 #28

Gold has never dropped to 0.
haha, i guess you got "D" score in highshool on WWII-times history, for example.
let alone some other ages, like chemical breakthroughs[Platinum forging, for example].
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June 11, 2011, 08:02:54 PM
 #29

It's not at zero and there was a time when gold wasn't interesting at all and still there are people who give a fuck about gold. Also gold had a much boarder acceptance since global trade began. There weren't any kids with no knowledge who got a heart attack because of a chart. Last, but not least we are trading Bitcoins, not gold. Some people call it a currency, others call it a commodity or both. Who cares? There isn't a logical reason behind all of this, just guesses about why people act in certain ways.

We can compare, but we can't look into the future. Tomorrow Bitcoin may be near to zero or back at 40USD. Same is true for next week or next month.

It's not like suddenly everyone found out that Bitcoin won't to it. People are just reacting to a coup by a few people. I wonder whether this was their intention. It's nice, because you learn a lot about markets, economy, psychology, ...

Hehe, I wonder whether this could even affect real world economy when everyone sells or returns video cards. Crash of real life currencies. xD

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June 11, 2011, 08:05:02 PM
 #30

In my personal oppinion, because a lots of people using gold as somewhat "based for trading".
A preasure from technology site can change people as well.
International space station, long space exploration etc. that can result in finding another stuff more effective than "gold" ?
Or antimatter research like giant atom smasher... that can result in convert things by atom bases or unknown result ?
A "based for trading" won't always keep up with future technology... ,
can't keep up with human population... it will changed... but it needs process and or replacement...
And i hope it won't results in another WW,
while bitcoins is somewhat based on electricity... and technology ?
so a country with more electricity and advance in technology will have more power ?
that is why i don't know about the future of gold...
personally I'm scared using gold "as a place to run off" for all my fortune.
What if some CERN scientist saying that... "We can create gold" ?
Well that is my personall opinion Smiley

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June 11, 2011, 08:16:33 PM
 #31

Gold has never dropped to 0.
haha, i guess you got "D" score in highshool on WWII-times history, for example.
let alone some other ages, like chemical breakthroughs[Platinum forging, for example].

Wow.  I don't even know how to respond to such an idiotic statement.  I make a claim that gold has never dropped to 0 [during human history].  In those cases such as WWII when gold was banned by certain governments, it still has a value as a store of wealth or in the black market.  Even with chemical breakthroughs, gold still has value as a substitute, although of course it would be worth much less.
dn't
The US can't confiscate anything at MtGox. MtGox is based in Japan.

um we wrote their constitution. I bet we could "convince" them.

umm...who is this "we"?  You didn't write the Japan constitution.  Your friends didn't.  I didn't.  Your parents didn't.  I bet that you don't have any real relationship with any of the drafters of the constitution.  Did you even have a choice in the matter?  What were your specific contributions when you helped write the constitution?

"We will not find a solution to political problems in cryptography, but we can win a major battle in the arms race and gain a new territory of freedom for several years.

Governments are good at cutting off the heads of a centrally controlled networks, but pure P2P networks are holding their own."
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June 11, 2011, 08:20:41 PM
 #32

I'm going to guess when some guys got stranded on a desert island, gold was about as close to worthless as possible.
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June 11, 2011, 08:25:15 PM
 #33

I'm going to guess when some guys got stranded on a desert island, gold was about as close to worthless as possible.

It depends on what is the scope of the OP's question, "Did gold ever drop to worthless?".  There has never been a global valuation of gold as 0.  There has always been someone somewhere in the world willing to trade their gold with something of value from someone else.  I suppose that for any commodity, currency, or any economic good/service for that matter, there may always be an isolated situation where that thing is worthless.

"We will not find a solution to political problems in cryptography, but we can win a major battle in the arms race and gain a new territory of freedom for several years.

Governments are good at cutting off the heads of a centrally controlled networks, but pure P2P networks are holding their own."
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June 11, 2011, 09:08:19 PM
 #34

Worthless? Aside from before humans started to trade gold, perhaps not.

Worth Less: Defiantly can't eat gold, in human history there where times and places where gold traded for equal weight of salt...

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June 12, 2011, 12:29:22 AM
 #35

so, you lack of agruments ? except personal offense, which isn't one of.
thats hardly surprising.
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June 12, 2011, 07:04:34 AM
 #36

gold is gold. bitcoin is bitcoin.

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June 12, 2011, 07:52:45 AM
 #37

"Well, gold is not really worth anything!"?

"Hey, you know, you're right! I'm passing by the dump on the way home, want me to throw your gold out for you"?

If I make you smile you can hook me up a teeny bit:  13hKeyHMv5YMWxvwj9M1fTntGJiogdhbeo
westkybitcoins
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June 12, 2011, 10:31:40 AM
 #38


Gold is pretty much worthless as a commodity.  Gold is the most irrational commodity that humans trade.  It has no use other than it's shiny and it's perception of value.  Only a true idiot would believe gold has any meaning or value.  It is a business though and a very profitable one.  Where profit exists, money will follow.

This is just flat-out false. Gold's chemical, electrical, and even some of its physical properties make it such that its rarity is the only thing keeping humans from using it in a variety of ways on a daily basis.

If gold were as common as dirt, it would be coating our flatware; inside our electronics (much more so than now!); adorning our books, paintings and clothing; inside our bodies (teeth, metal plates and rods, etc.); within most places of manufacture; and would just generally be the second most-used metal next to iron.

Gold's intrinsic value is why it became desirous enough to start being used as money in the first place.

To be honest gold really is only valued for its shininess and density. Gold has, and always will be out of reach to industries for its massive cost. Silver is a much better conductor, although it has oxidizing properties so they use gold where they cannot use solder mask ie. Connecting chips such as RAM / CPU's. However the amount of gold used for these processes is only about 5-6% of the mined supply. That leaves about 70-80% for jewlery, and the rest being investments. Clearly nearly 90-95% of it's value comes from its "Shininess", and a weak dollar/ hedge against inflation.

Gold is valued for it's numerous useful properties. If it was an ugly brown color and had no jewelry market use to speak of, that would just free up more of it for its other uses. Its price might be lower (so if by value you refer specifically to price you might be right) but it would still be a highly, highly valued commodity.

Can we at least agree that if gold were abundant, it would be used pretty much everywhere, far beyond cosmetic situations?

Bitcoin is the ultimate freedom test. It tells you who is giving lip service and who genuinely believes in it.
...
...
In the future, books that summarize the history of money will have a line that says, “and then came bitcoin.” It is the economic singularity. And we are living in it now. - Ryan Dickherber
...
...
ATTENTION BFL MINING NEWBS: Just got your Jalapenos in? Wondering how to get the most value for the least hassle? Give BitMinter a try! It's a smaller pool with a fair & low-fee payment method, lots of statistical feedback, and it's easier than EasyMiner! (Yes, we want your hashing power, but seriously, it IS the easiest pool to use! Sign up in seconds to try it!)
...
...
The idea that deflation causes hoarding (to any problematic degree) is a lie used to justify theft of value from your savings.
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