Abe Mishima

China Concerns, Crashing Currencies and the Future of Gold Purchases

Gold is as artificial as currency. Unlike paper money, gold is fairly illiquid. Want a demonstration? Put two kilotons up for sale on the open market, and see the price plummet to $500/oz. The author indicated that the retail demand fell when the price went above $750/oz. With extraction costs amounting to $400/oz, what is the impetus for increasing supply? If not for jewelry and electronic plating, what use does gold have? Gold bugs have got to stop being enamored by this shiny asset. In a Great Depression, gold is no more valuable than a loaf of bread. As a hard asset, the utility is less than land (another finite, tangible asset). With value so dependent on "perception", all that glitters is not goog.