Steve B wrote:
After being mentioned in many other posts here, I would like to talk about
gold a bit.

I have a friend. He is a certified financial planner, and my advisor. He
is a high school graduating classmate of my wife. He has the longest
running unsyndicated talk show in the United States, being on the air longer
than Rush Limbaugh. He is soon to syndicate if he has not done so by now.
The man knows his stuff.

We were visiting him, and the discussion of gold came up. He said people
would use it as a hedge, but he pointed out its impracticalities.

First, there's the ever present practice of fraud. Just like Josh, the deaf
mute in San Francisco who would take a nickel and coat it with gold, and get
five dollars worth of goods, there would be potential for fraud. And every
transaction would have to test the gold.

Fraud is everywhere, the honest and dishonest soon would get sorted out.
Deal with only known honest people.


How would one receive change from a purchase?

Real silver and gold coins would work. Gold dust would work too. Or
better yet a debit card backed by a deposit of gold.



The places that dealt in gold, or took gold as a medium of exchange would
have to set up heavy security, adding cost to an already bloated financial
situation.
People who went to these places for purchases would be marked as having gold
and subject to hijacking.

It happens at the ATM's already.


If society ever got that bad, a person having gold would have to become a
recluse, or just bunker in, and defend his pile with weaponry.

I guess Bank safe deposit boxes are not on your menu.


You can't eat gold.

Gold has no real value except what you can trade it for with people that
want it. Who is better off a man with a billion dollars of gold or a
farmer with plenty of food and wants a pound of gold for a pound of food.

As long as someone will accept gold as a payment for goods the gold has
value. This is the same with paper money. Money is just an IOU that is
as good or bad as the issuer. Tangible goods have real intrinsic value,
money does not and neither does gold except for it's use in industry and
jewelry. It is shiny colorful and easy to form into jewelry but after
that it doesn't do you any good. You can't eat it, it won't keep you
warm, it won't keep the rain and snow off your head.

John