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[bigegg]

I read a lot...
And I sometimes spend too long thinking about what I read.

I need to get something off my chest, and this seems a good place to do it-
Plenty of opinions on OOF, even if no experts 

so:
Precious metals, especially gold, are the only truly universal money - as in, you can go anywhere in the world (and even at any point in history), and swap gold (or silver) for the local currency.

There is approximately a total of 150k tonnes of gold in the world (at £27M per tonne present value) = 4million millions of quids.
The US gold reserve is about 8000 tonnes = 216,000 million quid (call it 100K million dollars)US trade deficit is 500K Million dollars (dec 2010 figures).

if the world suddenly decides that the dollar is no longer worth the paper it's printed on, the US government is going to have to buy a LOT of gold to pay it's debts.
heres the thought that's worrying me -
one theory is, that gold will increase in price against the dollar until the sums balance - ie, until the 8000 tonnes of gold they have in reserve is worth 500K million dollars.
This means gold will raise to about 4,000 quid an ounce, rather than the 850 quid it is at now - 5x increase in price

Another theory is that gold price against a currency is based on the amount of that currency in circulation.

eg - there are 11 million million dollars in circulation.
vs 8000 tonnes of gold in US reserves.
equating to an expected price of 1.375M dollars per kilo as opposed to 43k now (a 32x increase in price).

either way, the theories predict that gold prices are going to sky rocket, and probably soon.
That *could* be why there are so many companies trying to buy as much as they can lay their hands on...

[mantagte]

read
"Down to a Sunless Sea" by David Graham

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

this is one take on "what if"

[bigegg]

I'll keep my eyes open for it.
in the meantime, I'm spending my spare cash on gold coins...

[Varche]

I am not an economist but I can tell you it is all a fairly unsophisticated confidence trick whereby people daily work and get paid in worthless bits of paper which they can then swap for food, energy and so on.

If the pack of cards were to collapse then for a while and certainly when normality returned then gold would have the buying power.

However if normality never returned then the only think worth anything would be food and water. You can't (easily) eat gold. 

[bigegg]

I'm not too bothered about the worst case scenario.

I have what might be called "medieval" skills - I'm a fairly good blacksmith and metal-caster - I've even made cast iron from ore, in my back garden.
I'm actually working on a woodgas producer at the moment. (used in WW2 to run petrol engines on wood!)

I'm reasonably confident in being able to support myself if it ever got that bad.
I'm more interested in people's opinions on the theories above

[tidla]

interesting read.

not knowing much about the subject a bit of quick research was in order.

it seams that most countries like to keep some gold in there back pocket, just in case.. to match their economy.

as the economies are growing faster than it comes out the ground..

i bid 2p more for your gold coin

[Kevin Wood]

I'm not too bothered about the worst case scenario.

I have what might be called "medieval" skills - I'm a fairly good blacksmith and metal-caster - I've even made cast iron from ore, in my back garden.
I'm actually working on a woodgas producer at the moment. (used in WW2 to run petrol engines on wood!)

I'm reasonably confident in being able to support myself if it ever got that bad.
I'm more interested in people's opinions on the theories above

Have you seen this?

http://www.gas-turbines.com/nt6/index.html

Kevin

[cem_devecioglu]

I read a lot...
And I sometimes spend too long thinking about what I read.

I need to get something off my chest, and this seems a good place to do it-
Plenty of opinions on OOF, even if no experts 

so:
Precious metals, especially gold, are the only truly universal money - as in, you can go anywhere in the world (and even at any point in history), and swap gold (or silver) for the local currency.

not only gold , many kinds of valuable metals ,precious stones are also easily exhangable..

There is approximately a total of 150k tonnes of gold in the world (at £27M per tonne present value) = 4million millions of quids.
The US gold reserve is about 8000 tonnes = 216,000 million quid (call it 100K million dollars)US trade deficit is 500K Million dollars (dec 2010 figures).

if the world suddenly decides that the dollar is no longer worth the paper it's printed on, the US government is going to have to buy a LOT of gold to pay it's debts.

nope.. they will probably pay with oil or declare another war

heres the thought that's worrying me -
one theory is, that gold will increase in price against the dollar until the sums balance

will increase of course..but other longer term predictions will likely fail..

 - ie, until the 8000 tonnes of gold they have in reserve is worth 500K million dollars.
This means gold will raise to about 4,000 quid an ounce, rather than the 850 quid it is at now - 5x increase in price

Another theory is that gold price against a currency is based on the amount of that currency in circulation.

this is no longer valid I'm afraid since USA is the absolute military power (for long time) they produce money as they wish..but even sea is finished.. 

eg - there are 11 million million dollars in circulation.
vs 8000 tonnes of gold in US reserves.
equating to an expected price of 1.375M dollars per kilo as opposed to 43k now (a 32x increase in price).

either way, the theories predict that gold prices are going to sky rocket, and probably soon.
That *could* be why there are so many companies trying to buy as much as they can lay their hands on...

many well known valid currencies are under the risk of devaluation as owner of those currencies are under the risk of high debits..thats a logical move..

[bigegg]

I'm not too bothered about the worst case scenario.

I have what might be called "medieval" skills - I'm a fairly good blacksmith and metal-caster - I've even made cast iron from ore, in my back garden.
I'm actually working on a woodgas producer at the moment. (used in WW2 to run petrol engines on wood!)

I'm reasonably confident in being able to support myself if it ever got that bad.
I'm more interested in people's opinions on the theories above

Have you seen this?

http://www.gas-turbines.com/nt6/index.html

Kevin

I have now...
Bookmarked, and waiting for new CD to be released.

2000w generator and will run on biomass (I pulp around 10 tonnes of waste/damaged books a week - that's a LOT of fuel)

[bigegg]

Precious metals, especially gold, are the only truly universal money - as in, you can go anywhere in the world (and even at any point in history), and swap gold (or silver) for the local currency.

not only gold , many kinds of valuable metals ,precious stones are also easily exhangable..

but only gold is easily recognizable as gold - it's colour, weight and softness are not easily faked
if the world suddenly decides that the dollar is no longer worth the paper it's printed on, the US government is going to have to buy a LOT of gold to pay it's debts.

nope.. they will probably pay with oil or declare another war

A large portion of it is owed to china, and japan, in the way of treasury bonds.
Can't see them declaring war on china.

And trying to invade the middle east to control the oil? -
If the dollar value fails, they're not going to be able to buy it. - they can't use oil, without risking WW3

heres the thought that's worrying me -
one theory is, that gold will increase in price against the dollar until the sums balance

will increase of course..but other longer term predictions will likely fail..

 - ie, until the 8000 tonnes of gold they have in reserve is worth 500K million dollars.
This means gold will raise to about 4,000 quid an ounce, rather than the 850 quid it is at now - 5x increase in price

Another theory is that gold price against a currency is based on the amount of that currency in circulation.

this is no longer valid I'm afraid since USA is the absolute military power (for long time) they produce money as they wish..but even sea is finished.. 

Again - absolute military power against china? I don't think even american's are that stupid. America's main power comes from the fact that they control the worlds finances

either way, the theories predict that gold prices are going to sky rocket, and probably soon.
That *could* be why there are so many companies trying to buy as much as they can lay their hands on...

many well known valid currencies are under the risk of devaluation as owner of those currencies are under the risk of high debits..thats a logical move..

[Banjax]

ironically gold isn't that great an investment - people think its safe and always increasing in value, but in reality its incredibly volatile - you could buy all the gold you wish and in a few years the price may have doubled or trebled but just as likely its collapsed  :-?

so if you're a gambler then it may be fun 

[cem_devecioglu]

Precious metals, especially gold, are the only truly universal money - as in, you can go anywhere in the world (and even at any point in history), and swap gold (or silver) for the local currency.

not only gold , many kinds of valuable metals ,precious stones are also easily exhangable..

but only gold is easily recognizable as gold - it's colour, weight and softness are not easily faked



if the world suddenly decides that the dollar is no longer worth the paper it's printed on, the US government is going to have to buy a LOT of gold to pay it's debts.

nope.. they will probably pay with oil or declare another war

A large portion of it is owed to china, and japan, in the way of treasury bonds.
Can't see them declaring war on china.


some time ago, when china only spell of selling them and changing to euro, the us authorities talks were  no different..may I remind that us industry/economy will have a life kiss when wars come to scene..


And trying to invade the middle east to control the oil? -
If the dollar value fails, they're not going to be able to buy it. - they can't use oil, without risking WW3
[/color]

they already invaded   saudi lands , iraq and some other oil countries are anyway under their control..


heres the thought that's worrying me -
one theory is, that gold will increase in price against the dollar until the sums balance

will increase of course..but other longer term predictions will likely fail..

 - ie, until the 8000 tonnes of gold they have in reserve is worth 500K million dollars.
This means gold will raise to about 4,000 quid an ounce, rather than the 850 quid it is at now - 5x increase in price

Another theory is that gold price against a currency is based on the amount of that currency in circulation.

this is no longer valid I'm afraid since USA is the absolute military power (for long time) they produce money as they wish..but even sea is finished.. 

Again - absolute military power against china? I don't think even american's are that stupid. America's main power comes from the fact that they control the worlds finances


nah.. they cant control even their federal reserve bank as it doesnt belong to them




either way, the theories predict that gold prices are going to sky rocket, and probably soon.
That *could* be why there are so many companies trying to buy as much as they can lay their hands on...

many well known valid currencies are under the risk of devaluation as owner of those currencies are under the risk of high debits..thats a logical move..

[Martin_1962]

read
"Down to a Sunless Sea" by David Graham

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

this is one take on "what if"

That is one of my favourite books.

The stretch 747s I do remember

[Webby the Bear]

well if the price of gold is gonna rocket, im gonna buy up argos's entire stock of sovereign rings.... i get to cash in and the chavs wont be able to wear them 

[Lizzie_Zoom]

Most has been said on this thread that can be said about gold, but I thought I would share this delightful video explaining simply some facts pertaining this magical substance:

[media]http://www.youtube.com/watch?v=asodfnJbPR8[/media]


..............and according to all the facts available the USA still holds the highest level of gold reserves (around 8,000 tonnes) for a single nation, but China is increasing its holdings with the fifth highest reserves in the world.  The European zone holds collectively around 11,000 tonnes.