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Debate: Gold has no real value to the man in the street.

Practical value of gold from a “man in the street” point of view.

For the vast majority of people on this planet gold is worthless.

A bold statement but consider the following.

To live you need money, doesn’t matter what sort as long as it’s the money that is in circulation in your country. With this money you buy, food, housing, energy, transport plus the other essentials needed for life.

If you are in work you will typically get paid your supply of money by your employer. If you are on benefits you get your money from the government and if you are on a pension you get your money from your pension provider. If you are begging on the streets you get your money from charitable sorts who feel kind enough to give you some of their money gained from the first three sources mentioned above. All these sources provide “money” not gold.

Next when you come to spend (or give away) your money the recipient will want, you guessed it, your money. He doesn’t want gold or any other stuff that has a “value” such as silver, lead, pretty crystalline minerals or anything else. He wants your money.

So what are you going to do with your gold. You have 3 options, wear it, store it or exchange it. If you wear it, it has no value to you. OK it has value to someone else, but to you it’s just jewellery. If you store it, it has even less value as you don’t actually derive any personal satisfaction other than telling everyone you are sitting on a pot of gold. If you sell it you typically sell it for money, which you can then use to but everything mentioned above. But you can only do this once.

So, unless you own a factory that makes electronic products or jewellery or are a professional gold trader, gold has no value to the man in the street.

Topics: economics
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    Oct 25 2012: ... in the defence of Gold... it has significant value within electronics as you mention Howard. The underlying issue is our whole money system - and why it does not work. Gold price is just a way of attempting to fix the unfixable. See:Economics - step out of the dream

    http://www.commonsensethinking.co.uk/economydream.html

    jp

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