Current Gold Price

UndercoverElephant · Post by **UndercoverElephant** » 24 Jun 2011, 01:13

Anybody following this thread who hasn't seen the nations chart on this page might well be interested. If the current financial system goes tits-up and gold resumes its traditional status, this is who has currently got what...

http://en.wikipedia.org/wiki/Gold_reserve

woodpecker · Post by **woodpecker** » 24 Jun 2011, 08:12

Aren't some of those figures wrong owing to dictators and their families/lackeys having run off with it? eg Middle East and N Africa

http://www.businessinsider.com/leila-tr ... old-2011-1

UndercoverElephant · Post by **UndercoverElephant** » 24 Jun 2011, 10:36

woodpecker wrote:Aren't some of those figures wrong owing to dictators and their families/lackeys having run off with it? eg Middle East and N Africa

http://www.businessinsider.com/leila-tr ... old-2011-1

Very likely, yes.

biffvernon · Post by **biffvernon** » 24 Jun 2011, 11:47

That list makes you wonder. Gold is, apart from some limited use in electrical things, basically useless. One day it might just occur to governments that holding thousands of tons of the stuff is of no use. So they might just sell it off. The UK government did this a few years ago but it looked a bit silly when nobody else followed suit and the price went up. If a big country tried it again and a couple more followed, realising there's no gold standard and cash can be quantitatively eased independently of gold, then... well, that would be a surprise for some.

The thousands of tons in the strategic vaults could make an awful lot of trinkets, baubles and bangles.

Post by **clv101** » 24 Jun 2011, 12:42

biffvernon wrote:That list makes you wonder. Gold is, apart from some limited use in electrical things, basically useless.

Its psychological value is a very real use, the collective opinion of a few billion people to value gold is a use in itself. And not one that's likely to be eroded any time soon.

In some ways these non-tangible things (beliefs, value systems, behaviour etc.) are more 'real' than physical, tangible things. It's easier to change technology than change behavior and values. Whilst there could be a global moment of clarity where everyone discounts gold as fairly pointless beyond pretty jewelry - I wouldn't bet on it!

PS_RalphW · Post by **PS_RalphW** » 24 Jun 2011, 12:43

Unlike economists, ordinary people know the value of gold.

It is rare, very hard to imitate, easy to work and not prone to chemical oxidation. It is also bright and shiny and easy to make into gaudy trinkets.

As a symbol of wealth and power in a steady state economy it is hard to beat.

There are enough non-economists in national governments (except our own) to ensure that gold never loses its value completely.

Ludwig · Post by **Ludwig** » 24 Jun 2011, 13:26

biffvernon wrote:realising there's no gold standard and cash can be quantitatively eased independently of gold

This is precisely why gold has value. It's like money, except that you can't quantitatively ease it.

Money is simply a master gauge for the relative values of goods. It's a lot easier to say, "A loaf of bread is worth 89p" than "A loaf of bread is worth 3 carrots, OR half a pint of bottled beer, OR a third of a bag of rice" - ad infinitum.

Money is so convenient that people prefer to have it than to have a huge store of barterable goods. But essentially, it does the same job.

The problem is that governments forget what money is really for, or just get greedy, and print more of it so they can increase their store of notional barterable goods, at no cost to themselves! At some point, their bluff is called.

You can't do that with gold. Of course, in times of desperate global scarcity, gold too would be useless. But as long as enough people have surpluses of goods to trade, some kind of money system will persist because the alternative, barter, is just too messy. And if the paper/electronic system has lost credibility, people will switch to a "currency" that can't be arbitrarily created, and can't easily be forged - i.e. gold.

UndercoverElephant · Post by **UndercoverElephant** » 24 Jun 2011, 13:35

biffvernon wrote:That list makes you wonder. Gold is, apart from some limited use in electrical things, basically useless. One day it might just occur to governments that holding thousands of tons of the stuff is of no use. So they might just sell it off. The UK government did this a few years ago but it looked a bit silly when nobody else followed suit and the price went up. If a big country tried it again and a couple more followed, realising there's no gold standard and cash can be quantitatively eased independently of gold, then... well, that would be a surprise for some.

It would indeed be a surprise - for almost everybody. Like many other things you imagine happening, it's not going to.

biffvernon · Post by **biffvernon** » 24 Jun 2011, 13:53

UndercoverElephant wrote: it's not going to.

So long as lots of people keep believing that, you'll be correct.

There are a number of thing that seem to depend on lots of people believing something: BAU, continued economic growth, god, the value of gold. If one of those is seen to go belly up, does it impinge on belief of one or more of the others?

UndercoverElephant · Post by **UndercoverElephant** » 24 Jun 2011, 14:09

biffvernon wrote:
UndercoverElephant wrote: it's not going to.
So long as lots of people keep believing that, you'll be correct.

There are a number of thing that seem to depend on lots of people believing something: BAU, continued economic growth, god, the value of gold. If one of those is seen to go belly up, does it impinge on belief of one or more of the others?

No. IMO, if/when BAU ends then more people will turn to religion, not less.

Although it has to be said that when mediaevil BAU "went belly up" because of the arrival of the Black Death, it sufficiently damaged the population's faith in Catholicism to eventually lead to the Protestant Revolution. If the clergy are closer to God, why were they being punished as severely as the common people?

UndercoverElephant · Post by **UndercoverElephant** » 24 Jun 2011, 23:51

UndercoverElephant wrote:
GlynG wrote:Massive drop even quicker the other way now - it just went back down to £950 or so.
The IEA has just announced it is going to try to flood the oil markets with 60m barrels of oil from US, Japanese and european stockpiles. This is driving the prices of commodities lower (don't ask me why it effects anything other than the price of oil, I was just watching CNBC and that's what the bloke said....) There's got to be a connection though, unless this is a very unusual co-incidence.

http://uk.ibtimes.com/articles/20110624 ... elease.htm

The big drop in oil prices resulted in algorithm selling across the commodity complex, leading to losses in gold and even sharper drops in silver, platinum and palladium.

OK, this makes sense to me. It wasn't human traders that caused the gold price to plummet in response to the IEA decision to release oil stockpiles, it was a load of computers all running similar programs: the oil price went down, so the algorithm decided that gold was likely to go down, so gold went down.

I think this is quite interesting with respect to how things are going to play out - we (not that most of us had anything to do with it) have delegated the fate of our financial system to a load of computers. If there's going to be a "fast crash moment", if you know what I mean, it may be when this collective network of algorithms reaches some sort of mathematical tipping point.

?

Lord Beria3 · Post by **Lord Beria3** » 27 Jun 2011, 11:21

If we coming towards a major bond crisis (affecting first the fringe states like Greece and than moving to the core like Japan and America) where do you see gold moving to?

UndercoverElephant · Post by **UndercoverElephant** » 27 Jun 2011, 11:40

Lord Beria3 wrote:If we coming towards a major bond crisis (affecting first the fringe states like Greece and than moving to the core like Japan and America) where do you see gold moving to?

Are you asking me?

Without knowing what algorithms those computers are running, or what point they call for their human operators to intervene because certain critical limits have been breached, it is impossible to say.

Lord Beria3 · Post by **Lord Beria3** » 27 Jun 2011, 12:06

Just wondering, I'm trying to work it out myself.

If 1% of money in the US bond market moved into PM's, how far would gold go? Oh well, can't see any articles looking into it at the moment.

Sure that will change.

biffvernon · Post by **biffvernon** » 27 Jun 2011, 22:38

http://www.channel4.com/programmes/disp ... /episode-1

And you really want to own this stuff?