The little yellow god. Even at $500, it's still a barbarous relic

The Economist ^ | Dec 1st 2005 | Unsigned

[Comstock1]

Yeah, but does anybody want even an honest one--I mean I think Howard Dean is honest. An honest nutjob.

[Moonman62]

Does anyone know WHY gold should or might be considered a "barbarous relic"?

My guess is it refers to mercantilism and all the violence that went along with that flawed economic system.

[.cnI redruM]

You'd probably succeed handsomely.

[dangus]

"Do these look bigger to you"

--Jennifer Aniston to Jim Carey, "Bruce Almighty"

Sorry, no pix. You were too transparent. (Or not transparent enough?)

[dangus]

On second thought, I'll compromise. Here's an inflated boob:

[COBOL2Java]

The little yellow god. Even at $500, it's still a barbarous relic

Oh, sorry. I thought this story was about Kim Jong Il...

[.cnI redruM]

When was KIJ ever worth $500? (Even discounting all four years of Carterflation)

[bert]

Meanwhile, gold made an end run around naysayers today and broke past the New York $500 price for daylight. With no defenders in sight it looks like a downfield run for the goal line.

[.cnI redruM]

Freepmail me when it hits $2,073.20.

[bert]

.....Out vast wealth is based on the knowledge of our workers......

Perhaps our vast wealth is irrelevant to most of the world that worries about the impending doom in France and resultant failure of the economic system that creates wealth with no intrinsic value..

[bert]

...Land is the most valuable currency. It is definable and finite....

However in places where they cannot buy land, they can buy gold.

[Cuttnhorse]

The difference being your list has silver and copper in their un-corroded state. Hence, gold-plated copper connectors.

Exactly...copper and silver actually oxidize, while gold does not.

[enraged]

I heard/read that an ounce of gold 100+ years ago would buy the same amount of goods as it would today.

10 dollar gold piece 100+ years ago = $10 and buys x pounds of wheat, coffee, whiskey, corn and gun powder with lead.

A 10 dollar gold piece today = $500+/- (Assuming an ounce)

I never really stopped to do the math but it seems close at first glance.

[COBOL2Java]

When was KIJ ever worth $500? (Even discounting all four years of Carterflation)

Pyongyag says he's good at sports, tho...

[bert]

....Freepmail me when it hits $2,073.20......

I'll set the alarm, but I sometimes forget.

Why $2,073.20?

[Alter Kaker]

Which means you wouldn't have made any money. But had you bought a diversified portfolio of stocks 100 years ago, you'd have made an enormous amount of money.

[Flying Circus]

The inability to control the gold supply is the greatest problem with gold as a currency. The quantity of money in the market needs to be controlled to maintain economic growth.

While being able to turn the mints up to full speed and flood the economy with new money sounds like a good way to fund a national debt it is very short sighted. To do so would destroy the credibility of the US dollar as a worldwide currency and would drive the borrowing costs through the roof. The economy would go into a tailspin as foreign capital fled and the interest costs on any new deficits would quickly outrun the cost of our current debt.

In a perfect world they would introduce just enough new dollars to match growth in the economy. But being an imperfect world they err on the side of caution to avoid any deflation and generate a few points of annual inflation.

While inflation is not good, deflation is devastating to economic growth- why buy/invest when you can sit on the cash and afford more later? Because the supply of gold cannot be controlled, the economy can be whipsawed around by shortages and surpluses in the gold supply.

[ozzymandus]

If gold keeps going up, I may be able to get my money back on the gold I bought in the 80's!

[Petronski]

I've never understood the fascination with the 'gold standard'.

When has any primal fetish ("oonga boonga! shiny!") made sense?