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Originally Posted by TheDoc
Yeah, I agree eco 101. The problem is we don't have less supply and we're not running short on it anytime soon or ever. The price isn't increasing because we have less gold.
You can still find gold laying in Rivers in America, let alone what's in the ground around the world. If it's demand for use in products has gone up, that is still so minor in the overall amount of Gold - that we can throw our products away (trash the gold).
When you buy gold, you're not actually buying gold - you don't take away gold from the supply (in most cases). All someone has to say is, they aren't paying on those notes - and it's over.
No different than the money supply or stocks, you're buying a tiny fraction of real value and the rest is bullshit.
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First off, there's supply side and there's demand side. On the supply side, we
ARE running out of gold. In this particular instance however, Gold is going up because we're in a worldwide depression and faith in fiat based systems is shattering, so Gold is and always has been the way out. No, you're talking about etf's which constitute a small percentage of gold buying. I happen to have 15k worth of physical gold bars stored in a vault because when push comes to shove, etf's are as useful as the US dollar.
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People are buying stocks, not gold..
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This is completely misleading. More people buy stocks because there are more stocks than actual gold for sale in the world. And if you look at anytime the Dow rises these days, the volume trading is down. When the Dow drops, the volume is huge. This means that a small # of individuals or companies manipulate the price of the stock by buying large amounts of it.