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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum
GLD 375.96-1.8%Nov 14 4:00 PM EST
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To: TobagoJack who wrote (178317)9/15/2021 12:33:46 AM
From: sense  Read Replies (1) of 217829
 
I do question the legitimacy of the data as represented, though... particularly as it shows the discovery of America being deflationary... when the reality is that when Spain discovered gold and silver in the new world... the relatively large mass of new gold and particularly silver that began pouring into Spain, and into the Spanish trade routes across the Pacific, it fueled a pretty significant inflationary expansion in the total amount pf money in the global money supply... while also fostering significantly greater velocity of money, given its immediate recruitment into the Pacific trade...

See for instance:
The impact of silver from the New World – how the Peso as first global currency came into being in 16th century AD

Or:
Precious metals and mining in the New World: 1500–1800

I've noted often how annoying I find "history" that pretends all people now dead were stupid... and there's a bit of that, I think, in ridiculous charts like this one... that seem to show that gold was "invented" in the California gold rush of 1849... While it is true that gold production has increased significantly in the industrial era, now that we don't limit ourselves to digging it out of the ground with teaspoons ? The picture doesn't begin to tell the whole story... and can't without also considering population growth... but, it does help to put the lie to the story that gold prevents inflation... rather than only limiting it to the pace at which more is found and produced... which tends to average right around 2% per year... while the addition of digital or ink based zeros to non-substantive and ephemeral forms of fiat money has many fewer limits.

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