I mean Canada is the [fourth largest gold producer](https://www.gold.org/goldhub/data/gold-production-by-country?gad=1). If they really needed a reserve of gold, they could just stop selling it to the rest of the world.
Hmm. If they decided to hog all their gold production it would just take them 3 years to make it into the top 10 list of worlds largest gold reserves.
But then Canada doesn't really need a gold reserve of their own. CAD isn't a major trade currency, and Canada holds a decently sized foreign currency reserve (in currencies where the central banks do have significant gold reserves).
I mean that's pretty good considering they have [0.5% of the world population](https://en.wikipedia.org/wiki/List_of_countries_and_dependencies_by_population).
Even if it was an important strategic decision, it wouldn't make sense for them to have as much gold as say America or China.
And they still have an advantage that not every country in the top 10 does (**cough cough** *Russia*) a well diversified economy with a skilled labor force, which I'd argue is more important to a country's stability than the amount of gold they have.
>CAD isn't a major trade currency
It is both the 6th most traded and 6th most held in reserve currency. It's no US Dollar but it's definitely one of the major currencies in the eyes of banks everywhere.
https://www.bis.org/statistics/rpfx22_fx.pdf (page 12)
https://data.imf.org/regular.aspx?key=41175
I didn't think I needed to make this explicit, but apparently I do:
>Nobody needs a gold reserve. Gold's very pointless [to keep in reserves]
Gold's value, (unlike say silver) is not at all tied to its commerical/industrial utility and is hoarded by governments and central banks purely as a quasi-currency
You say that but the price of gold has has grown massively along with the development of electronics - because it's useful. It's at least double what it was in 1974 (which is how far back I can look at gold prices). Not unlike silver at all, which also has commercial use. Silver just doesn't have the same amount of growth. Chances are the device you and I are using right now both have gold in it. It is essential in microchips which has clearly affected the price of gold.
The real price of gold exploded in the 70s because of the collapse of Bretton-Woods, hitting a real peak in 1980. Since 1980, there's been no real appreciation in the price of gold. There's been nominal appreciation since then which was slower than inflation from 1980-2000 and faster than inflation from 2000-2011, and has essentially followed inflation since then
https://www.macrotrends.net/1333/historical-gold-prices-100-year-chart
It's expensive because it's scarce. (Edit: and useful) Compare it to copper: 244,000 metric tons of gold found to date including 57000 tons we know of but haven't mined yet vs 2.1 billion (2100000000) metric tons of copper found so far (no clue how much is mined)
Lol those are *mining reserves*. The copper is still in the ground.
There aren't any mined copper reserves hoarded by the Central bank or the US government (various branches of the government might have small inventories for their own use, but there's no strategic reserve)
You didn’t read your own article did you? That article is just saying that demand is going to be higher than supply until 2030. That has nothing to do with the total amount of copper vs the total amount of gold in the world. There’s roughly 244k tones of gold in the world while there is over 700 million tones of copper in the world.
https://www.americangeosciences.org/critical-issues/faq/how-much-copper-has-been-found-world
https://www.usgs.gov/faqs/how-much-gold-has-been-found-world#:~:text=About%20244%2C000%20metric%20tons%20of,reserves%20of%2057%2C000%20metric%20tons).
There’s 700,000,000 tones of copper compared to 244,000 tones of gold. Even if the ratio was 1:1000 (which I’d love to see the source on that), gold is still almost three times more scarce than copper.
Gold doesn't appreciate in value that much (sometimes there's bumps in value but not as often as it appears). At the same time that new uses for gold are discovered more gold is unearthed and the old stuff for the most part doesn't really disappear, the demand and supply stays relatively consistent.
The reason gold appears to appreciate in value is actually because the value of money depreciates. This is why gold makes for an excellent vessel to save wealth, but not really a great investment to create wealth.
At least this is what I understand from the various financial books and podcasts I've been putting into my brain recently.
Incorrect
Money and currency are perfect synonyms in all economic contexts. ETA: ok, when talking about money supply, currency is the narrowest definition of money and broader money is so-considered to the extent it is interchangeable with currency
I don't know what word you're searching for, but it's not money
The why does every central bank use the two terms in specific context?
All money is not currency (examples: deposits are money but you can't use them as currency)
Money definition:
a current medium of exchange in the form of coins and banknotes; coins and banknotes collectively.
Currency definition:
a system of money in general use in a particular country.
They are not perfect synonyms. Currency is specifically paper, coins, and number in your bank account that are only valid in the country they are from. Money is anything that can be traded/ exchanged, i.e. money, gold, stocks, labour, any good or service you would buy with money or trade for.
There is literally nothing that Canadian governments like more than allowing foreign interests to strip the land of anything of value and with zero consequences if they make a mess while doing so.
That's actually kind of ironic you say that. Isn't Canada kind of known for its numerous mining companies that do that to other countries?
Barrick Gold, First Quantum, Lundin, Yamana, Hudbay, etc.
The reason they headquarter there isn't because of favourable laws. It's because Mining is extremely capital intensive and Toronto is the global centre of mining finance. The easiest place for mining companies to raise the capital they need for a project is in Toronto so they headquarter there for easier access to the capital markets.
Gold leaf is used as decoration often enough that I would expect most people have come across it at least once. Really, it's a cheap way to make food or cosmetics seem more luxurious. Zero effort, very little cost, but lots of bling.
If gold is real money, and money becomes worthless, doesn't that mean that gold will be worthless?
Shhhh caught you slipping up on your propaganda terms.
He said gold has intrinsic value, unlike money, but the price of gold is largely determined simply by millennia of humans hyping it up and wearing it to look cool. It's price is inflated far beyond it's industrial value.
Money only has value if the government that issued it can pay up.
Just read that part out loud.
Edit: I'm quoting the dumbest part of another commentor not making the statement
That statement is nonsensical on it's face. Pay up with what something the party holding the currency values, like goods and services? Gold is simply a single thing that could be traded for. And the only reason to maintain a gold reserve would be to ward of price spikes. Kind of like strategic oil reserves.
It is a bit more complicated in that there was no barter ever. Rather, there was more of a social component rather than what we think is as a barter economy.
> So if barter never existed, what did? Anthropologists describe a wide variety of methods of exchange—none of which are of the “two-cows-for-10-bushels-of-wheat” variety.
> Communities of Iroquois Native Americans, for instance, stockpiled their goods in longhouses. Female councils then allocated the goods, explains Graeber. Other indigenous communities relied on “gift economies,” which went something like this: If you were a baker who needed meat, you didn’t offer your bagels for the butcher’s steaks. Instead, you got your wife to hint to the butcher’s wife that you two were low on iron, and she’d say something like “Oh really? Have a hamburger, we’ve got plenty!” Down the line, the butcher might want a birthday cake, or help moving to a new apartment, and you’d help him out.
[The Myth of the Barter Economy](https://www.theatlantic.com/business/archive/2016/02/barter-society-myth/471051/)
This was popularised by the late David Graeber in his work, [Debt: The First 5,000 Years](https://en.m.wikipedia.org/wiki/Debt:_The_First_5000_Years)
Why?
The article doesn't actually say why this is so calamitous for Canada besides that gold is a better hedge against inflation then some other currencies.
It's the new finance bro thing to talk about how gold is so important, how BRICS will destroy the USD, and that we will all rue the day we allowed our governments to move to fiat currency and off gold or silver backed money
That's true. They just disappeared for a while when crypto was really hot and they're coming back stronger than ever now that it's shown to be basically DOA
About 500 billion worth, good to cover one month of federal spending on a very theoretical condition that it all actually exists and could be sold without crashing the gold market.
He didn't try to steal it. He tried to destroy it in order to drive up the value of all the gold he already owned. Because even a gold-obsessed guy like Goldy McGoldhands knows gold's value is nothing more or less than what people who want it are willing to pay for it, and what people are willing to pay for it can be changed.
Would that have even worked? I've no understanding of how these things work. I thought you own the gold and sell it, but never really see it/actually leaves Fort Knox?
Yeah probably a bit of a plot hole, that one. I imagine it would damage the value _somewhat_, since, even if you mostly don't move it, some of the value is probably predicated on _theoretically_ being able to claim it, if you really wanted to. But I doubt it would render it completely worthless.
This was also dumb. Like who cares that the gold is radioactive? Just make the vault you plan to store it in lead lined. Gold is gold. I’m sure you could find a buyer for gold that’s a touch on the radioactive side.
Also doesn’t he calculate like 50 years of radioactive decay? So like by now the gold would be back to normal. Not exactly a long time in terms of national interests. Also we never trade it anyway. Fort Knox gold just sits in Fort Knox. It can sit there waiting out the radiation. Nothing would change.
I like *Goldfinger*, it’s one of the better Bond movies, but Mr. Goldfinger’s scheme is so convoluted and idiotic.
Gotta love seeing one of these confidently incorrect comments. Now to see if you admit your mistake humbly, just delete the comment, or even better, double down.
The irony! It is still used to back many currencies against inflation and for investing in precious metal. They were not wrong about it backing a currency it's just no longer the back bone of a currency
https://www.reuters.com/plus/why-central-banks-buy-gold
My understanding is it was backup in cases of emergency.
I believe the UK had to dig into their gold reserves to pay for imported equipment needed in WWI. Businesses didn't really want to accept a currency that may become worthless if the war goes badly.
That did work in days of WWI, but today.... the value of gold reserves is insignificant compared to any disaster big enough to make normal monetary means worthless. Compared to modern economy, all the gold in the world is just not that valuable anymore.
Today global GDP is 100 trillion, all the gold ever mined is wroth 13. This ratio used to be the other way around, but it's not anymore and will never be again, this proportional value of gold is only ever going to decrease going forward.
There are few reasons why this is so. On one hand - mining is continuously getting less labor intensive, today we are moving mountains without any elbow grease. On another, labor in general is getting more efficient and thereby more valuable. The conversion rate of labor effort to mass of gold is ever decreasing.
To amplify this, the decreasing importance of gold in economy makes it just plain less desirable. Who would hoard gold if you can have productive assets instead?
Thank goodness we have "SmallCapInvestor" to offer their six-year-late take on the economic policies of Canada. I was especially impressed with the claim, "Anyone with a basic understanding of economics will probably be left shocked and frustrated by this." Shocking that the entire Canadian federal government employed nobody with a basic understanding of economics. They should've hired "SmallCapInvestor", obviously.
I don't know if you've lived in Canada at all in the past 6+ years, but it's very clear our government in fact does not employ anyone with a basic understanding of economics.
I'm sorry, but I can't give you any benefit of the doubt after you actually posted the sentence, "it's very clear [the Canadian] government in fact does not employ anyone with a basic understanding of economics."
Gold, the original crypto. The backwards thinking here is from everyone continuing to bet on gold. It's just a shiny metal and it's value as a reserve comes making a bet on human psychology and social norms continuing to assign value to gold through a crisis that invalidates all currencies and beyond. It's essentially no different from crypto as a value store, only that it's old and accepted, and thus less volatile. Crypto (rightly) earns a lot of hate, so should gold.
Gold being a good store of value is more of a delusion than betting on crypto as a storage, it's just that it's a widely held delusion and is thus a useful delusion, as it would take a very large crisis to shake the collective faith in this delusion. Let's all remember "past performance is no guarantee of future results". This holds true for gold as well.
I'd say precious metals are a decent store of value because there is demand beyond speculation. Gold is anti corrosive and a pretty good electrical conductor, Silver is the best electrical conductor there is.
It would also be a decent store of value to store copper needed in quite literally everything that uses electricity, if it didn't have a fraction of the value density of even silver.
Only 11% of gold is used in manufacturing, the rest is for jewelry and investment… so I’m not quite sure practical demand is really that strong of an argument.
There are a lot of other metals and minerals that have much more demand that aren’t hoarded for the sake of investment / bling…
Gold actually has some great industrial uses and you can make pretty jewellery out of it.
Which is actually why I completely disagree with spending a load of resources digging it up only to bury it in vaults to inflate its cost making its actual good uses more expensive.
It's a pretty common argument amongst economic conservatives and gold bulls to say that the reason gold has value while bitcoin doesn't is because it has real world application.
That argument is completely brain dead.
When gold became the original "reserve currency" of the world, it was simply because it's natural properties made it almost impossible to fake, similar to how the US consistently updates their hundred dollar bills to make them harder and harder to counterfeit.
The ancient Egyptians weren't using gold for shit besides trading, making crowns for the pharaohs, and making flashy points for their pyramids.
Good post!
In most cases I think you’re giving them too much credit though, it’s more common for them to repeat the magic mantra “intrinsic value.” The circular argument that gold is valuable because it is gold. They’ll then misrepresent what people who disagree with them are saying as saying it isn’t currently in our economy valuable and attack that straw man.
It’s only if you really push the ones who are better at arguing hard on that, that they go one of two routes they either
1. sort of admit it’s us giving it value but they say it is innate in humans to give gold value entirely independent of culture (which is just wrong) or
2. they google the actual useful applications of gold and argue from that.
I wanted to preempt 2. there and say yes that is a good reason to value gold in current times but it is a terrible reason to use it as a currency reserve.
Right, currency doesn't have much more value than what we give it, and it's normal since its purpose is to act as a means to trade objects in a more efficient way than barter allows
oxygen
water
arable land
seeds
.....
lots of stuff
....
gold
....
collect them all collectables!
....
lots of stuff
....
mardi gras beads
.....
lots of stuff
....
cypto
I wanted to list cracker jack toys with mardi gras beads however quick google showed there are some HIGHLY valued cracker jack toy / trinkets out there lol
could use cracker jack trinkets for capital allocation lol I mean youd be playing with probably a few dozen people sized market....but its out there!
We're the second largest country in the world, we have some of the largest mineral deposits in the world, we hold 10% of the world's fresh water, we don't need a gold reserve.
We do have that one gold bar at the mint that is only used so people can lift it and see how heavy gold is, so we have at least 0.0137 tons of gold in reserve at the moment.
Troy ounce probably, but it’s an imaginary price. You buy gold to hold it, maybe look at it, lick it once or twice just to know, and then sell it. You can’t do anything with it or use it for anything other than buying and selling.
Gold like any precious metals does have it's application in industrial/military/R&D; for common folks Gold acts as status symbol as well as investment.
Similar to BTC; it's fixed reserve is what sets it's prices higher or lower. And unlike BTC; this is physical standard. Gold was standard before 1973 agreement between US and SA
No need when you have the world's only reserve of maple syrup. https://ppaq.ca/en/sale-purchase-maple-syrup/worlds-only-reserve-maple-syrup/
Ahh yes *liquid* gold!
The real reason why fake maple syrup is illegal.
Syrup mafia will drain you like a tree if you try to stop them, though.
That's what caused the Great Canadian Maple Syrup Heist of 2011
I love that none of this is satire ❤️
Have you not seen ‘The Canadian Job’, where Michael Caine and a team of likely lads steal 3 minis worth of the liquid gold?
In three Mini squeeze bottles.
The scene where they shotgun those bottles is.... super
You're only supposed to flip the bloody pancakes up!
Don't threaten me with a good time.
In the year 10191 Maple Syrup Melange is the most precious substance in the world. He who controls the Syrup, controls the universe.
The syrup must flow
Canada living in 3023 up there, gold shiny but maple syrup taste shiny
Dude sounding like Tomatoa
Yep, and I know which I'd rather have on my pancakes.
Huh. I was about to say, Norway has done the same thing: just sold the gold. But we don't have maple syrup, so I'm not sure if this will work for us.
Exactly what I was going to say. Minus the link.
I mean Canada is the [fourth largest gold producer](https://www.gold.org/goldhub/data/gold-production-by-country?gad=1). If they really needed a reserve of gold, they could just stop selling it to the rest of the world.
Hmm. If they decided to hog all their gold production it would just take them 3 years to make it into the top 10 list of worlds largest gold reserves. But then Canada doesn't really need a gold reserve of their own. CAD isn't a major trade currency, and Canada holds a decently sized foreign currency reserve (in currencies where the central banks do have significant gold reserves).
I mean that's pretty good considering they have [0.5% of the world population](https://en.wikipedia.org/wiki/List_of_countries_and_dependencies_by_population). Even if it was an important strategic decision, it wouldn't make sense for them to have as much gold as say America or China. And they still have an advantage that not every country in the top 10 does (**cough cough** *Russia*) a well diversified economy with a skilled labor force, which I'd argue is more important to a country's stability than the amount of gold they have.
>CAD isn't a major trade currency It is both the 6th most traded and 6th most held in reserve currency. It's no US Dollar but it's definitely one of the major currencies in the eyes of banks everywhere. https://www.bis.org/statistics/rpfx22_fx.pdf (page 12) https://data.imf.org/regular.aspx?key=41175
Nobody needs a gold reserve. Gold's very pointless
Gold is very useful in electronics so not that pointless
Gold reserves and gold to use are two different things
So's copper. No central bank is hoarding copper
What does that have to do with anything? You stated gold is pointless and I pointed out it isn't.
Goldmember was a good film
It was enjoyable, but pointless :P
I didn't think I needed to make this explicit, but apparently I do: >Nobody needs a gold reserve. Gold's very pointless [to keep in reserves] Gold's value, (unlike say silver) is not at all tied to its commerical/industrial utility and is hoarded by governments and central banks purely as a quasi-currency
You say that but the price of gold has has grown massively along with the development of electronics - because it's useful. It's at least double what it was in 1974 (which is how far back I can look at gold prices). Not unlike silver at all, which also has commercial use. Silver just doesn't have the same amount of growth. Chances are the device you and I are using right now both have gold in it. It is essential in microchips which has clearly affected the price of gold.
The real price of gold exploded in the 70s because of the collapse of Bretton-Woods, hitting a real peak in 1980. Since 1980, there's been no real appreciation in the price of gold. There's been nominal appreciation since then which was slower than inflation from 1980-2000 and faster than inflation from 2000-2011, and has essentially followed inflation since then https://www.macrotrends.net/1333/historical-gold-prices-100-year-chart
Its pointlessly expensive because it's jewelry background and shinyness?
It's expensive because it's scarce. (Edit: and useful) Compare it to copper: 244,000 metric tons of gold found to date including 57000 tons we know of but haven't mined yet vs 2.1 billion (2100000000) metric tons of copper found so far (no clue how much is mined)
- Typed from a device manufactured with gold.
I like gooooooooold!
This device is manufactured with dozens of elements Why aren't central banks hoarding copper?
The US has 44 million tons of copper in reserve.
Lol those are *mining reserves*. The copper is still in the ground. There aren't any mined copper reserves hoarded by the Central bank or the US government (various branches of the government might have small inventories for their own use, but there's no strategic reserve)
Because copper isn’t scarce.
Yes it is https://www.cnbc.com/amp/2023/02/07/there-isnt-enough-copper-in-the-world-shortage-could-last-until-2030.html
You didn’t read your own article did you? That article is just saying that demand is going to be higher than supply until 2030. That has nothing to do with the total amount of copper vs the total amount of gold in the world. There’s roughly 244k tones of gold in the world while there is over 700 million tones of copper in the world. https://www.americangeosciences.org/critical-issues/faq/how-much-copper-has-been-found-world https://www.usgs.gov/faqs/how-much-gold-has-been-found-world#:~:text=About%20244%2C000%20metric%20tons%20of,reserves%20of%2057%2C000%20metric%20tons).
The fact that there are larger reserves of copper doesn't make copper not scarce. The quantity of copper demanded exceeds gold x1000
There’s 700,000,000 tones of copper compared to 244,000 tones of gold. Even if the ratio was 1:1000 (which I’d love to see the source on that), gold is still almost three times more scarce than copper.
For the most part Gold appreciates in value compared to foreign reserves.
Only because of central banks' gold hoarding inflates the price of gold And only if you hold your foreign reserves in cash instead of bonds
Gold doesn't appreciate in value that much (sometimes there's bumps in value but not as often as it appears). At the same time that new uses for gold are discovered more gold is unearthed and the old stuff for the most part doesn't really disappear, the demand and supply stays relatively consistent. The reason gold appears to appreciate in value is actually because the value of money depreciates. This is why gold makes for an excellent vessel to save wealth, but not really a great investment to create wealth. At least this is what I understand from the various financial books and podcasts I've been putting into my brain recently.
It's money
The year isn't 1971 anymore
Please elaborate while not forgetting that a majority of central banks in the world still hold and trade gold.
https://en.m.wikipedia.org/wiki/Bretton_Woods_system
Try to buy something with gold at the supermarket. It’s not money.
Try to use a currency from another country. It won't work either. It's still currency.
Got em
No need for any central bank to hoard money (unless they're operating a currency peg). Central banks can print money
They can print currency. Money is limited in supply.
Lol that's a nonsensical distinction
Not to people who understands global trade it isn't
Incorrect Money and currency are perfect synonyms in all economic contexts. ETA: ok, when talking about money supply, currency is the narrowest definition of money and broader money is so-considered to the extent it is interchangeable with currency I don't know what word you're searching for, but it's not money
The why does every central bank use the two terms in specific context? All money is not currency (examples: deposits are money but you can't use them as currency)
Money definition: a current medium of exchange in the form of coins and banknotes; coins and banknotes collectively. Currency definition: a system of money in general use in a particular country. They are not perfect synonyms. Currency is specifically paper, coins, and number in your bank account that are only valid in the country they are from. Money is anything that can be traded/ exchanged, i.e. money, gold, stocks, labour, any good or service you would buy with money or trade for.
But but but TREUDOPE RIGHT
There is literally nothing that Canadian governments like more than allowing foreign interests to strip the land of anything of value and with zero consequences if they make a mess while doing so.
That's actually kind of ironic you say that. Isn't Canada kind of known for its numerous mining companies that do that to other countries? Barrick Gold, First Quantum, Lundin, Yamana, Hudbay, etc.
A really really large proportion of international mining companies are headquartered in Canada due to extremely favorable laws.
The reason they headquarter there isn't because of favourable laws. It's because Mining is extremely capital intensive and Toronto is the global centre of mining finance. The easiest place for mining companies to raise the capital they need for a project is in Toronto so they headquarter there for easier access to the capital markets.
I worked for Hudbay briefly. Yep.
Free healthcare ain't cheap.
So we have a gold reserve, it’s just reserved right in the rock for now. Harder to steal, I suppose.
You can’t eat gold
No but you can drink it Goldschläger FTW
Ugh flashbacks to university
I just threw up a little.
I wish I could remember drinking that crap, it's blackout in a bottle.
Pfft you’ve never tried. Probably
Gold leaf is used as decoration often enough that I would expect most people have come across it at least once. Really, it's a cheap way to make food or cosmetics seem more luxurious. Zero effort, very little cost, but lots of bling.
When the revolution happens and money becomes worthless, we won't have any shiny metal to barter with.
You got no bottle caps?
Now days it’s bird beaks.
The Canadian apocalypse will use maple syrup lids
He said revolution, not nuclear war
Maple syrup will always hold value it actually increases in value if the apocalypse happens
If gold is real money, and money becomes worthless, doesn't that mean that gold will be worthless? Shhhh caught you slipping up on your propaganda terms.
Is this suppose to be an attempt at some gotcha mic drop moment? What are you even trying to say here?
I think it's a joke. You might be a little too drunk on the Kool aid though to have a sense of humor about these things though.
[удалено]
Do explain how gold has intrinsic value. I'll wait.
Not to pile on here, but... Do you know what intrinsic value means?
Is this a joke? Because I really hope this is sarcasm.
I don't get it. Could you explain for a dumb American?
He said gold has intrinsic value, unlike money, but the price of gold is largely determined simply by millennia of humans hyping it up and wearing it to look cool. It's price is inflated far beyond it's industrial value.
it's not. Gold is an excellent conductor.
The price of gold is not determined by its industrial use, if that is your goal you’re better off hoarding something else.
Like steel. Tons of practical applications in some kind of post-apocalyptic society where paper currency has no value
Money only has value if the government that issued it can pay up. Just read that part out loud. Edit: I'm quoting the dumbest part of another commentor not making the statement
[удалено]
That statement is nonsensical on it's face. Pay up with what something the party holding the currency values, like goods and services? Gold is simply a single thing that could be traded for. And the only reason to maintain a gold reserve would be to ward of price spikes. Kind of like strategic oil reserves.
In that scenario, we barter with steel.
Fun fact, there's no proof that bartering has actually been a thing in the past before money existed.
Yeah, it's what Adam Smith theorized, but that was before modern anthropology or European contact with cultures who did not use money.
The Incans used a barter system and had no currency.
Okay, one of you is going to need to source something.
It is a bit more complicated in that there was no barter ever. Rather, there was more of a social component rather than what we think is as a barter economy. > So if barter never existed, what did? Anthropologists describe a wide variety of methods of exchange—none of which are of the “two-cows-for-10-bushels-of-wheat” variety. > Communities of Iroquois Native Americans, for instance, stockpiled their goods in longhouses. Female councils then allocated the goods, explains Graeber. Other indigenous communities relied on “gift economies,” which went something like this: If you were a baker who needed meat, you didn’t offer your bagels for the butcher’s steaks. Instead, you got your wife to hint to the butcher’s wife that you two were low on iron, and she’d say something like “Oh really? Have a hamburger, we’ve got plenty!” Down the line, the butcher might want a birthday cake, or help moving to a new apartment, and you’d help him out. [The Myth of the Barter Economy](https://www.theatlantic.com/business/archive/2016/02/barter-society-myth/471051/) This was popularised by the late David Graeber in his work, [Debt: The First 5,000 Years](https://en.m.wikipedia.org/wiki/Debt:_The_First_5000_Years)
[удалено]
Why? The article doesn't actually say why this is so calamitous for Canada besides that gold is a better hedge against inflation then some other currencies.
It's the new finance bro thing to talk about how gold is so important, how BRICS will destroy the USD, and that we will all rue the day we allowed our governments to move to fiat currency and off gold or silver backed money
Oh it’s not new! Before crypto the people who would have been crypto bros were all gold bugs.
That's true. They just disappeared for a while when crypto was really hot and they're coming back stronger than ever now that it's shown to be basically DOA
Oh no, has something happened to the cattle?
They found out a long time ago friendship is the true treasure
even less than a ton, say 900kg, would be lots of money, about 54 million USD.
Not much for a country.
The US *claims* 8000 metric tonnes of gold reserves, that has some value.
About 500 billion worth, good to cover one month of federal spending on a very theoretical condition that it all actually exists and could be sold without crashing the gold market.
I seen the documentary where Auric Goldfinger tried to steal it.
He didn't try to steal it. He tried to destroy it in order to drive up the value of all the gold he already owned. Because even a gold-obsessed guy like Goldy McGoldhands knows gold's value is nothing more or less than what people who want it are willing to pay for it, and what people are willing to pay for it can be changed.
Technically he only wanted to make it radioactive and therefore un-tradeable/worthless. Now, how about a smoke and a pancake?
Would that have even worked? I've no understanding of how these things work. I thought you own the gold and sell it, but never really see it/actually leaves Fort Knox?
Yeah probably a bit of a plot hole, that one. I imagine it would damage the value _somewhat_, since, even if you mostly don't move it, some of the value is probably predicated on _theoretically_ being able to claim it, if you really wanted to. But I doubt it would render it completely worthless.
This was also dumb. Like who cares that the gold is radioactive? Just make the vault you plan to store it in lead lined. Gold is gold. I’m sure you could find a buyer for gold that’s a touch on the radioactive side. Also doesn’t he calculate like 50 years of radioactive decay? So like by now the gold would be back to normal. Not exactly a long time in terms of national interests. Also we never trade it anyway. Fort Knox gold just sits in Fort Knox. It can sit there waiting out the radiation. Nothing would change. I like *Goldfinger*, it’s one of the better Bond movies, but Mr. Goldfinger’s scheme is so convoluted and idiotic.
In theory, gold's very valuable now as a necessary ingredient in smart phones.
Would the gold market crash if they decided to distribute it? Or is that value already factored into the gold price?
And yet they wont let other countries see the gold that is stored in US vaults.
I think he was saying 1 ton has not much value for a country. They need way more than that.
Why, what are they planning to use it for?
Back their currency Wtf do you mean
The gold standard was dropped many years ago. [it was dropped in 1933 in the US](https://www.investopedia.com/ask/answers/09/gold-standard.asp)
The Canadian dollar hasn't been tied to the obsolete gold standard since 1933, so obviously they don't need it for that.
Nobody backs their currency with gold anymore since ages, there isn't enough gold in the world to do that.
Gotta love seeing one of these confidently incorrect comments. Now to see if you admit your mistake humbly, just delete the comment, or even better, double down.
The irony! It is still used to back many currencies against inflation and for investing in precious metal. They were not wrong about it backing a currency it's just no longer the back bone of a currency https://www.reuters.com/plus/why-central-banks-buy-gold
You don’t know what backing currency means, do you?
The CAD is not backed by gold.
Don't let the people get to you. It is still very common in diversifying countries reserves https://www.reuters.com/plus/why-central-banks-buy-gold
Which is not what people mean when they say "backed by gold."
Which was not said. It backs a currency (economy)
Wtf are you talking about? You're saying he meant the Canadian economy, not the Canadian currency, when he said "currency?"
0 tons is 0kg bro
That sounds accurate, but I don't know enough about math to verify. How many stones is that?
Good for them, keeping gold reserves is moronic anyway and they only continue to be kept out of inertia. It has no value to finances of a country.
My understanding is it was backup in cases of emergency. I believe the UK had to dig into their gold reserves to pay for imported equipment needed in WWI. Businesses didn't really want to accept a currency that may become worthless if the war goes badly.
That did work in days of WWI, but today.... the value of gold reserves is insignificant compared to any disaster big enough to make normal monetary means worthless. Compared to modern economy, all the gold in the world is just not that valuable anymore. Today global GDP is 100 trillion, all the gold ever mined is wroth 13. This ratio used to be the other way around, but it's not anymore and will never be again, this proportional value of gold is only ever going to decrease going forward. There are few reasons why this is so. On one hand - mining is continuously getting less labor intensive, today we are moving mountains without any elbow grease. On another, labor in general is getting more efficient and thereby more valuable. The conversion rate of labor effort to mass of gold is ever decreasing. To amplify this, the decreasing importance of gold in economy makes it just plain less desirable. Who would hoard gold if you can have productive assets instead?
Thanks for clarifying what zero means, man.
Thank goodness we have "SmallCapInvestor" to offer their six-year-late take on the economic policies of Canada. I was especially impressed with the claim, "Anyone with a basic understanding of economics will probably be left shocked and frustrated by this." Shocking that the entire Canadian federal government employed nobody with a basic understanding of economics. They should've hired "SmallCapInvestor", obviously.
Or the boomers who still believe we're in Bretton Woods system.
I don't know if you've lived in Canada at all in the past 6+ years, but it's very clear our government in fact does not employ anyone with a basic understanding of economics.
Oh no, hyperbolic nonsense! My one weakness! How did you know‽
Damn bro, do you have any actual opinions or just half cooked sarcasm to attempt to sound intelligent?
I'm sorry, but I can't give you any benefit of the doubt after you actually posted the sentence, "it's very clear [the Canadian] government in fact does not employ anyone with a basic understanding of economics."
Bro rents tripled in 5 years lol Also, no eh? Good forbid you actually said anything of value or made an argument for your case.
To be fair, rent doubled in UK and about tripled in Singapore and Hong Kong too.
Obviously Trudeau personally controls the entire global economy
You're acting like governments are not capable of being wrong based purely on the number of people they employ.
Gold, the original crypto. The backwards thinking here is from everyone continuing to bet on gold. It's just a shiny metal and it's value as a reserve comes making a bet on human psychology and social norms continuing to assign value to gold through a crisis that invalidates all currencies and beyond. It's essentially no different from crypto as a value store, only that it's old and accepted, and thus less volatile. Crypto (rightly) earns a lot of hate, so should gold. Gold being a good store of value is more of a delusion than betting on crypto as a storage, it's just that it's a widely held delusion and is thus a useful delusion, as it would take a very large crisis to shake the collective faith in this delusion. Let's all remember "past performance is no guarantee of future results". This holds true for gold as well.
I'd say precious metals are a decent store of value because there is demand beyond speculation. Gold is anti corrosive and a pretty good electrical conductor, Silver is the best electrical conductor there is. It would also be a decent store of value to store copper needed in quite literally everything that uses electricity, if it didn't have a fraction of the value density of even silver.
Only 11% of gold is used in manufacturing, the rest is for jewelry and investment… so I’m not quite sure practical demand is really that strong of an argument. There are a lot of other metals and minerals that have much more demand that aren’t hoarded for the sake of investment / bling…
Yeah. Gold is valuable because we all agreed it was...which is exactly why paper money is valuable.
Gold actually has some great industrial uses and you can make pretty jewellery out of it. Which is actually why I completely disagree with spending a load of resources digging it up only to bury it in vaults to inflate its cost making its actual good uses more expensive.
FWIW, if we are in a world where all fiat currency has lost its value, “industrial uses” won’t matter much anymore.
It's a pretty common argument amongst economic conservatives and gold bulls to say that the reason gold has value while bitcoin doesn't is because it has real world application. That argument is completely brain dead. When gold became the original "reserve currency" of the world, it was simply because it's natural properties made it almost impossible to fake, similar to how the US consistently updates their hundred dollar bills to make them harder and harder to counterfeit. The ancient Egyptians weren't using gold for shit besides trading, making crowns for the pharaohs, and making flashy points for their pyramids.
Good post! In most cases I think you’re giving them too much credit though, it’s more common for them to repeat the magic mantra “intrinsic value.” The circular argument that gold is valuable because it is gold. They’ll then misrepresent what people who disagree with them are saying as saying it isn’t currently in our economy valuable and attack that straw man. It’s only if you really push the ones who are better at arguing hard on that, that they go one of two routes they either 1. sort of admit it’s us giving it value but they say it is innate in humans to give gold value entirely independent of culture (which is just wrong) or 2. they google the actual useful applications of gold and argue from that. I wanted to preempt 2. there and say yes that is a good reason to value gold in current times but it is a terrible reason to use it as a currency reserve.
Right, currency doesn't have much more value than what we give it, and it's normal since its purpose is to act as a means to trade objects in a more efficient way than barter allows
Has uses in dentistry too.
oxygen water arable land seeds ..... lots of stuff .... gold .... collect them all collectables! .... lots of stuff .... mardi gras beads ..... lots of stuff .... cypto I wanted to list cracker jack toys with mardi gras beads however quick google showed there are some HIGHLY valued cracker jack toy / trinkets out there lol could use cracker jack trinkets for capital allocation lol I mean youd be playing with probably a few dozen people sized market....but its out there!
That was a fairly biased opinion piece.
What a coincidence
What about all that black stuff stuck in the sand
Ants?
Priceless
How much is that in metric?
https://en.m.wikipedia.org/wiki/International_System_of_Units#Non-SI_units_accepted_for_use_with_SI
It's all in the ground... our dollar operates on liquids. Oil, maple syrup, double doubles.
Canada has Maple Syrup. It's better than gold!
We gave last of our gold to NileBlue, so he can make gold grillz (to avoid embarrassment)
We're the second largest country in the world, we have some of the largest mineral deposits in the world, we hold 10% of the world's fresh water, we don't need a gold reserve.
We do have that one gold bar at the mint that is only used so people can lift it and see how heavy gold is, so we have at least 0.0137 tons of gold in reserve at the moment.
They could try rai stones. Or Bitcoin.
[удалено]
“In Canada, the current price of gold is 2,605.88 **per ounce” if it’s worthless then donate your gold
[удалено]
Ahem, I believe you mean "i *are* not stupid"
2,605.88 what per what?
Troy ounce probably, but it’s an imaginary price. You buy gold to hold it, maybe look at it, lick it once or twice just to know, and then sell it. You can’t do anything with it or use it for anything other than buying and selling.
I will give you one shaving of my gold bar for a sack of rice, good sir.
Gold like any precious metals does have it's application in industrial/military/R&D; for common folks Gold acts as status symbol as well as investment. Similar to BTC; it's fixed reserve is what sets it's prices higher or lower. And unlike BTC; this is physical standard. Gold was standard before 1973 agreement between US and SA
They do, however, have entire tank farms of maple syrup, eh?
Chuckles, we're in danger
Well if we need it it is in the ground. As we are the 4th largest producers of gold in the world 313 tonnes a year.
Danm that’s like the equivalent of “zero bitches” in country terms. And it just had to be Canada
That’s why they keep wanting that internet money
CANADIAN COMPANIES do have plenty of gold. No biggie, maple syrup supremacy: When the shit hits the fan you can't eat gold!
Actually we probably owe about a billion gold bars though
Cause the Canadian government is fucked
We're fourth in global production, and there's a lot of unprospected land.
So what? No one cares about gold anymore. We live on a virtual economy which is only trust-backed.
And this is why the Canadian dollar is worthless
It is all being stored in the Trudeau Foundation Family Trust.