While it's sort of true that the value of gold is because of the huge effort to mine it, the real value is that people are willing to buy it for expensive purposes such as displaying wealth, storing it and swapping it. The fact that gold is so hard to get means not much of it is produced.
The willingness to buy and the willingness to dig are in balance. If the price drops, then people won't dig. If the price zooms, people will dig flat out. It's interesting how all that vast effort from centuries gone by to excavate gold can be stored in the gold and handed on from generation to generation as a monetary unit. There isn't much that doesn't become obsolete. So far, gold has avoided that fate.
This part is wrong: <Gold and economic freedom are inseparable, > Gold is just one of many ways of exchanging value and storing it. Most societies have historically involved little or no economic freedom, with the king/emperor/chief monkey taking anything they like. But they were still based on gold as a unit of money. If anything , economic freedom has been most normal where gold was NOT the basis of money. All that fiat money means is that another avenue of tax collection is opened up, by way of dilution. That's not a big deal. The tax from dilution is small compared with the taxes on incomes and spending.
Meanwhile, my top secret new monetary system is coming along nicely. It will make gold obsolete. Once people realize gold has value only as a bauble, tooth filling, or electrical conductor free of corrosion/oxidation, the price will plunge to the cost of production plus profit, the same as digging coal, or anything else.
Gold is so last-century.
Mqurice |
