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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: TobagoJack who wrote (40621)	11/5/2005 2:56:15 AM
From: NOW	Respond to of 116555

indeed

To: TobagoJack who wrote (40621)	11/8/2005 5:40:14 AM
From: kelp	Read Replies (2) \| Respond to of 116555

So you believe that in the near future china and russia will not trade chinese cars for russian oil unless GOLD goes across borders? Honestly I don't see how you can really believe that but it seems you do. China is going towards a floating currency backed by their nation, its resources, production, and its citizens ability to make good things for all - that is real wealth - not shiny metal that serves no true fundemental use to the world currently other than jewelry. The chinese just got busted stealing STATE SECRETS from the USA - not breaking into Fort Knox for her GOLD. See what they truly value - INFORMATION,- the fruit of knowledge in the garden of eden - not shiny metal. I agree with Warren - The dollar is set to devalue, perhaps tremendously. Not because there isn't a lot of GOLD backing it, but because the nation and people in that nation don't effectively manufacture goods anymore for the world - so her currency must devalue. And in a free floating currency world, as hers devalues, the nation that is more effective - her currency will go up - thus bringing balance back into world trade. Mises went into this many times. Give me a sane reason why you feel brazil wont trade corn for asian tea unless gold goes across borders? Give me a sane reason in the future why coconut will not be able to buy her ANF jeans unless she first finds some way to acquire a shiny metal coin? Why won't volvo trade car impact patents with the USA for engine emmission patents unless GOLD goes across lines drawn on a map? It is silly. Greenspans point was that if all people/nations will take in TRADE is GOLD in a financial crisis - then yes you must hold some if you want to trade with that nation and keep trade flowing - and there are a few nations that may only take gold in trade - but General - if you and coconut need some water and thirsting to death - and the guy (mogambo guru) guarding the fresh springs with his assault rifle wants some of your prune juice popcorn recipe to flush his guts - why would you guys need to trade shiny metal to enact trade? It makes no sense. Think of it this way - look at the evolution of gold in trade - first individuals used it between each other, then it went up to small cities using it and the individuals were then on less rare tokens, then on up to nations/governments and the individuals were in credit cards with virtual tokens stored in a computerized database. Modern society and trade is only possible because of such liquid freely moving virtual wifi money. Gold would take us back to the dark ages. As societies grow in numbers - they need more and more liquid and easily flowing capital to enact trade - gold is great for small societies with small numbers of people - if gold coins were traded back and forth between individuals today trade would come to a virtual standstill. If you wish to live in a world of slow trade, slow progress, isolation, wars, protectionism, then I guess gold makes a lot of sense. Gold won't make your computer fire up so you can play deathmatch however.