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Comment by adaisadais | Hacker News Reader

Gold is such an odd form of value. If money, as Felix Martin puts it, is a social technology then gold is an antisocial technology. (1)

Gold and silver look great in a recession because they (unlike the buyer) do not panic. However, in the long run they provide virtually no value to society (unless you make some fancy jewelry or cover your toilet seat) and frankly I find owning large amounts of gold to be a silly proposition.

If society were to collapse I don’t think anyone would be hoarding gold or silver... unless your Blackbeard or Scrooge McDuck.

Edit: forgot to link :/ (1) https://www.google.com/amp/s/www.nytimes.com/2014/04/13/book...

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> If society were to collapse I don’t think anyone would be hoarding gold or silver

But people have hoarded gold and silver to successfully preserve value over the collapse of countless societies and civilisations for many thousands of years.

Why do you think our society and the one following it would be any different?

> I find owning large amounts of gold to be a silly proposition

I literally can't think of any more reliable, safe, enduring preserve of value across all of our existence.

If you dig up one of their hoards in a farmers' field today the value of the savings of a Roman from two thousand years ago are preserved to this day.

Can hardly describe it as silly?

>> "But people have hoarded gold and silver to successfully preserve value over the collapse of countless societies and civilisations for many thousands of years."

In 5000 years from now, I wonder if people will say the same thing about BitCoin.

A quick search shows a post from this week titled "Bitcoin drops 50% in epic two day tumble", so somehow I doubt it.

As others have said, Bitcoin is a very shallow market. It is "worth" a lot in principle, but good luck trying to convert it to cash.

local.bitcoin.com

Its easy to convert to cash in any major city.

Presumably, if it gets to the point where you need a safe-haven store of value, you won't be converting it to cash. You'd be transferring it directly to the recipient in exchange for food, shelter, or weapons.

I think if you’re to the point of liquidating assets for “food, shelter, or weapons”, I would prefer a few Krugerrands that fit in my pocket. How can Bitcoin beat them in terms of durability and wide acceptance?

5,000 years from now Bitcoin will the name for a category of physical relics surrounded by myths of hidden wealth, if only they could be unlocked. A loose network of hobbyists, cultists, and oddballs will trade in old digital wallets, external hard drives, and servers, and the occult pseudo-mathematical techniques they employ to try to unlock the encryption to see what's inside.

Legend has it that it would take beyond the end of the universe to succeed... but legends have been wrong before.

Because for millenniums society had a gold standard on some level. Currently, the U.S. does not and most other nations do not either. Why would we revert to something that is held in extreme scarcity? Will we revert to slavery if we were to have a societal collapse? Absolutely not.

Hypothetical: It's 2021 and a massive earthquake has cause a massive tsunami that has ravaged most of the cities along the Pacific. Shortly after your nation is invaded and a war breaks out. No one has power, food, or water. After a long war with many lives lost and lots of destruction do you seriously think people would care about gold or try and use it as serious form of a new nation's currency?

> Will we revert to slavery if we were to have a societal collapse? Absolutely not.

Not sure why you're so certain about that - societies have abolished slavery only for it to come back in subsequent societies before.

Concrete example - India under the Maurya Empire, only for it to come back in medieval times.

> After a long war with many lives lost and lots of destruction do you seriously think people would care about gold or try and use it as serious form of a new nation's currency?

Yes, because it's happened again and again and again and again and again across countless apocalypses.

> But people have hoarded gold and silver to successfully preserve value over the collapse of countless societies and civilisations for many thousands of years.

Ignoring the time from 1933 to 1971 when it was literally illegal to own more than a few ounces of gold.

Do you think nobody hoarded gold during this period? I'm sure they did.

And did it retain its value? Yes.

Finance is a mountain of complexity piled on an 'IOU Nothing'. Next time you log into Robinhood and pour your IOUs, stop and think if you've ever-- and I mean EVER-- examined precisely what it is you are buying.

What makes gold valuable is exactly what used to make dollars valuable. No BS and you'd be nuts to borrow to buy and hold them (because no yield and storage costs money). That means, in boom times they don't bubble (as much) because ppl aren't buying on credit, and in busts, people see both the intrinsic credibility and price action as a sign of strength.

Silver is a thin market more easily classified as a commodity somewhere between oil and gold. The oil market is in a very unusual situation. When that dumpster fire dies down look again at the movement in the gold/silver ratio.

No, I beg to differ. Gold is not some fiat currency backed by the U.S. Gov’t (1). The US Dollar is.

> you’ve ever— and I mean EVER— examined precisely it is you are buying.

The same could be said about gold. Have you ever melted down the gold to check for impurities? I would hope that most people who invest in stocks or real estate would actually do just that. Investment is a much much different idea than just gambling by picking hot stocks. Haha I also haven’t used good ole Robinhood in several years...

(1) https://www.federalreserve.gov/faqs/does-the-federal-reserve...

I was referring to reading a stock certificate. Stock is a nuanced and highly specific legal claim on a sliver of the capital structure of an artificial entity. I was referring to reading the terms, conditions and property embodied in the stock. I'm very diligent about such things and I personally never have read that, nor has anyone ever suggested I should ... because ... well ... I'm not sure momentum investors really care 99% of the time about the intrinsic value of whatever they're spending money on.

Gold is a natural element with scientific properties I'm generally aware of, even if I've never personally audited them.

[p.s. - I was also was referring to the historical value of the dollar. A "dollar" literally was at the time of adoption in the U.S. a fixed amount of precious metal.]

All value is about faith in the future. In fact it's about faith that society will continue to function in the future.

Gold works as a hedge against loss of faith, because it's a more tangible and less abstract symbol of hope than fiat money.

But ultimately it's all just concentrated hope. If you need food and no food exists, all forms of money are useless.

Gold has value only if people value it. Same goes for money, stocks, etc...

This simplification misses the point. Unlike paper money and stocks you can't print more Gold. That's why people fall back to it again and again. Also it has _some_ intrinsic value in various applications. I am not arguing we should be using Gold, only that the statement you make, while true on the surface, glosses over the entirety of the interesting and relevant points about its use as money, historically and today.

Gold is a noble metal and does not corrode. That is its main value as currency. It conveys a feeling of durability.

Gold has a couple other things going for it. It's difficult to counterfeit, anything denser than it is more expensive(and usually radioactive). Tungsten is close enough to be a viable alternative, but is very difficult to work with, so this is only a modern (1980s on) problem. Additionally it is "appropriately" rare. Try using sand as a currency, you'll need a fleet of dump trucks. You can transport a significant amount of gold on your person, but if you tried that with Californium you would probably lose the dust sized particle that represents your life's savings.

The high price of gold reduces the direct value it provides to society (because people pay more to hold it than to use it).

There's all sorts of uses for it. A good conductor that doesn't really corrode and all that.

Isn’t platinum better for all the practical (= other than jewellery) use-cases people use gold for? Why don’t people talk about speculating on platinum?

It's a significantly worse conductor than gold.

> If society were to collapse I don’t think anyone would be hoarding gold or silver... unless your Blackbeard or Scrooge McDuck.

Yes, hoarding gold is kind of dumb, especially if you want to barter with it: absolutely no one deals with it on a day-to-day basis so has no idea how much any amount is "worth".

Someone did a small experiment about trying to figure out would be best for emergency preparedness stockpiling (he lives in an earthquake zone):

* https://www.youtube.com/watch?v=aVkDj8lsR7I

Cash would be best, as after the emergency we'll just continue on people will be happy to have it. If you want to start worrying about bartering then booze is the best option: familiarity, doesn't spoil, 'inherent value' since people would still want to get tipsy even during emergencies. In the US ammunition could be used as well.

Giordano Bruno said that whatever has the most value and least cost of storage becomes money. Dunno if it's true but it seems solid, eh?

Some contend that gold is money. The historically most important one and the second most popular right now behind the dollar.

You can buy more things with bitcoin right now than you can with gold. Euro, Yuan, and Yen etc. are also way more popular forms of currency than gold is. However if you mean “money” as in “investment vehicle” then yes at this time it is popular.

i think you forgot the link to felix martin's article?

It's actually a book. I happen to be reading it right now (on recommendation of HN users):

https://www.goodreads.com/book/show/18050068-money

Well written and fascinating.

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