What do you mean when it became "too heavy to carry around"? Did the amount of gold required to purchase a specific item increase over time? If it wasn't too heavy to carry around for 2600 years, what changed at that point in time?
My thinking would lead me to believe that printing presses were not commonly available before the 1600s or so, which would have prevented paper money from being feasible. Again, just thinking aloud here, and curious as to what history/facts support the "too heavy to carry around" argument.
OK, saying "too heavy" was an "off the lip" statement.
I assumed most people here would be well aware that "most" (I'm not going to state "all" as like everything I'm sure there are exceptions) paper money started life as "receipts" for precious "items" (not necessarily metals) held in the early "banks". This receipt was then of course tradable as it "repaid" the goods to the "bearer".
The point here is that it is now possible to print the receipt without having the goods in the first place. That's why current printed money has a negligible intrinsic value (since the gold standard was dropped).
Alexandra New Zealand
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"The Constitution states that only gold and silver coin is legal tender in payment of debt"
"A system of paper fiat debt-money is destined to fail"
"Paper money is created out of thin air"
Why are you still arguing about "paper money". Paper money, is only as good as our government says, gold & silver is an acceptable payment world wide (our dollar is for now) and always will be. If you think PM's are worthless then dont buy them.
I would. 2% down? Dang, I was hoping more like 50% with essentially no position limit imposed on JPMorgan Chase. Sounds like I will be buying more and I have been.
People like you told me silver was a bad investment when it was at $7/oz. Thank Goodness, I didn't listened to geniuses like you.
a_riot, seriously, you suck at giving finance advises on internet. Stick to your 12hr/day day job.
did you fail Economics 101? Your statement above is complete hogwash. Price Searcher, Price Discriminator & Price Taker. All three exist in any market. Even in black market.
Your bs comment above, framed in pseudo economics jargon(I say pseudo, because you fail to understand the basic definition) basically tells me you have absolutely NO IDEA how the precious metals market works or any market for that matter. It's not market's obligation to find you a buyer or a seller. It's your job!
No, what you're doing is not answering the question. Instead of saying "here's a company that is interested in buying physical gold with prices paid near the market value," you're throwing a whole bunch of theory bs and some insults, thus actually proving my question as legitimate. You have no answer, do you?
So, oh brilliant economist, please enlighten us how i would go about finding a buyer for this gold? Is there some company that can help me? Or do i need to attend one of the "secret gold hoarding club" meetings with a briefcase chained to my wrist? How do i sell the physical gold that i have in my posession, within the next week or so, for something close to the $1330/oz like the market is?
Last edited by mad8vskillz; 01-29-2011 at 09:05 PM.
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Even if gold turns out to be the next material used as money, gold will simply be the next fiat currency and controlled by the gov't so what difference does it make? You are then back where you started.
I don't see much difference between the real estate bubble and the gold & silver bubble. You can make lots of money if you have the good fortune of timing the cycle. It's ugly if you are the last person in and the bubble bursts. In the long term, real assets more or less track the core inflation rate. In the long term, you do better investing in well-managed corporations where the company is growing at least as fast as the economy is growing.
this picture reminds me of someone on this thread...
anyways I have been looking into buying/investing into silver or a "PM" of some sort.
I understand and agree the price of silver and gold undoubtedly will go up in time(sure it goes up n down) but I understand it has a general rise
Can someone break it down for me as for when to buy?
I know "selling" isnt really advisable but, where do you sell it once you think its time or have an emergency?
I wish I could get into the gold market but, me like almost everyone else dont have the $ for that. anyways is this investment supposed to pay off in your life-time?
I'm not in for it for the post-apocalyptic as much as I am retirement sort of thing.
Volker would've raised the rate before he quit advising bunch of Goldmanites in WH if it was possible. You are absolutely clueless as to why now FED is on QE2, aka operation "Negative Real Interest Rate"
Distinct Possibility Soon, did you say? I will bring the post of yours above time and time again just to prove how utterly clueless you are.
US have chosen Hyperinflation over Real Interest Rate hike simply for the fact that any rise in real interest rate will threaten the government's ability to service it's debt. Whereas printing money silently taxes population. And you believe the real interest rate will rise? Soon? Distinct possibility? ROFLMAO Ummm......$15 trillion dollars soon dude!. Can you tell the board what is mere 4% interest on $15trillion is?
Genius! Seriously. Stick to your day job.
NO, I have been very clear here. Real interest rate has been stuck at zero/negative for many years now. They can't raise it simply because, excluding all social entitlement obligation, interest payment alone on national debt will wipe out all federal income tax collected then some. What you are describing is theoretical. Name me a single incident in history where a country in brink of currency collapse chose to raise rate then print the %@#* out of their currency. NONE. The debt will be serviced through hyperinflation. That is the only way. And debasement of Dollar is what is certain. Now, nuff schooling you over this subject. Please stick to your day job. I get that you kinda got the whole world figured out with your brain that earns $12.5/hr. Nothing but respect to you in that regards but do not pretend to know something you absolutely have no idea of. It stinks.
Back to main subject, silver and gold. US Mint sold absolute record amnt of silver eagles in Jan 2011
Thanks again for all the accolades, its really quite flattering.
In regards to your comment about interest rates and currency, there is a very well known correlation that perhaps you've never been made aware of between the value of a country's currency and interest rates. You see, as investment confidence in a country falls the risk of investing in that country goes up. If an investor will lose a percentage of their investment simply due to currency devaluation, then they will want a higher interest rate to compensate. Its quite simple really. So as the USD falls, rates will have to increase to prevent an exodus of money leaving the country which would be bad for the economy on many levels. I don't follow why you keep saying "They can't raise it" if by "they" you mean the Fed since the Fed adjusts rates according to what the market is doing not the other way around. If the market demands higher rates in exchange for increased risk, the Fed won't have much of a choice. They hope this doesn't happen as it will destroy US housing prices further, leading to more bank failures, and they can try to prop up the stock market to spur investment, but eventually if confidence wanes, rates will have to go up and probably quite quickly. At that point, your precious metals will become semi-precious at best.
Because of that, I don't think we're in for hyperinflation. I think we're in for a more subdued single digit inflation. 5% to 6% inflation over a decade will fix the housing problem and erode wages of the middle class to make them competitive on the world market.
I want one thing clear. I don't think neither you or a_riot understand the difference between real interest rate and nominal interest rate. Above I referred to real interest rate which is expressed in simple formula;
ri = ni-ir it says Real Interest Rate is equal to Nominal Interest Rate minus Inflation Rate
ir= [CPI(this year) – CPI(last year)] / CPI(last year)]
Guess where our real interest rate will be even if the rate is to go up as inflation accelerates?
Anyone who wants to understand the real inflation rate, I suggest that you visit http://www.shadowstats.com/