Gold has intrinsic value, paper currency does not.
Gold has some intrinsic value, but not much. You can make some electronics with it better than with other materials. Pretty much every other use of gold is driven entirely by supply and demand. People want gold jewelry instead of aluminum because of gold's extrinsic value (i.e., people want gold jewelry more than they want aluminum jewelry because they just do).
Gold cannot be inflated to worthlessness, paper currency can be.
Gold can be inflated to worthlessness if any of the gold producing countries decide to dump a ton of gold on the market all at once.
Gold cannot be declared worthless or "reverse split" by government fiat, paper currency can be.
Gold cannot be declared worthless by government fiat, but it can be made almost worthless if a country has a ton of gold and dumps it on the market. Also, gold can be made almost worthless for most people in the U.S. by government fiat if the government makes it illegal to own, buy or sell it (which it has done in the past).
Gold maintains its purchasing power over centuries, paper currency always goes to zero purchasing power.
Gold has maintained most of its purchasing power, but the price of gold has fluctuated a hell of a lot over the past centuries.
Gold is real money, paper currency is currency and there is a difference.
There is a difference, but again not that much. Gold has value because people want it. The price is entirely a function of current supply and demand. Massively increase the supply or prohibit ownership and cut demand and most of its value will be gone.
I don't look at physical gold or silver as an investment. Holding physical gold and silver is an insurance policy.
I agree with you 100% on this. I think everyone should own some gold, along with some silver and other commodities, real estate, mineral interests, stocks, bonds and cash. The key is diversification.
If you want to invest, put your money into things that earn more money - company stocks, productive land, mineral interests, etc.
If you want to protect yourself as much as possible from the inevitable economic downturns, depressions and/or financial armageddon, then also put some of your money in gold, silver and several other commodities.
If you invest in commodities hoping to make money by correctly betting whether they will rise or fall in value, then you would do better going to Las Vegas and betting on red or black on the roulette wheel. At least in Vegas you can also get drunk and take in a show.
Its intrinsic value comes not from any industrial use but from the energy and wealth that is inherently stored in that coin. The ore got dug up through a huge expenditure of energy and labor, it got refined processed and formed with more energy expenditure. Finally it was minted into a recognizable gold coin. All that energy is stored in that coin. That is intrinsic value. The paper in your pocket or worse yet the electronic money in your bank have zero intrinsic value. They can be infinitely produced.
Gold can be inflated to worthlessness if any of the gold producing countries decide to dump a ton of gold on the market all at once.
Do you truly believe that a gold producing country, acting in its own self interest, would dump gold to lower the value of its own gold holdings and gold mines? Let's look at reality. China produces about 410 tons of gold a year. It imports hundreds of tons more through Shanghai. It does not export a single ounce. This is not accidental. This is a government policy. A PBOC official who tried to export any amount of gold would lose his head before the first shipment reached Hong Kong.
Gold cannot be declared worthless by government fiat, but it can be made almost worthless if a country has a ton of gold and dumps it on the market. Also, gold can be made almost worthless for most people in the U.S. by government fiat if the government makes it illegal to own, buy or sell it (which it has done in the past).
See above for the answer to your first question. Your second question answers itself. Yes the US government can practice financial repression on its own people within its own borders. Too bad for you. It is a big world out there. I question whether they can get away with confiscating gold a second time. If that happens or you have fear that it will happen, bring your gold to me and I will convert it to any major currency less a small markup for my trouble.
Gold has maintained most of its purchasing power, but the price of gold has fluctuated a hell of a lot over the past centuries.
Right, and my guess is that it will continue to do so but, over time, it will retain its purchasing power far better than currency.
The price is entirely a function of current supply and demand. Massively increase the supply or prohibit ownership and cut demand and most of its value will be gone.
This massive increase of supply you refer to will not happen. I don't really know what the price effects of prohibiting ownership in the US to US citizens would be inside the US. I do know that 95% of the world would not be effected by such a prohibition. Assuming that the US government would be taking such gold out of circulation and storing it in Fort Knox then there would be less gold available on a worldwide basis and the price would go up. If they used the confiscated gold to settle foreign debts, the effects outside the US would be negligible. However, the effects would be devastating inside the US.
...put your money into things that earn more money - company stocks, productive land, mineral interests, etc.
I'm with you there, pal. Hard, income producing assets are the way to go.
If you want to protect yourself as much as possible from the inevitable economic downturns, depressions and/or financial armageddon, then also put some of your money in gold, silver and several other commodities. If you invest in commodities hoping to make money by correctly betting whether they will rise or fall in value, then you would do better going to Las Vegas and betting on red or black on the roulette wheel. At least in Vegas you can also get drunk and take in a show.
You are right again. An even better strategy would be to go to Vegas and just drink at the shows, no gambling.