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Warren Buffett on gold

- James Turk - Goldmoney

No James Turk, gold is not money so Ben Bernanke didn´t lie. Gold was money when we stamped a value on to it or when we where under a goldstandard. We are not going back to stamping values on gold or creating a new gold standard. We have some coins "stamped" but they will not be the general money. Hard money gold is a thing of the past bc it never lasts. History proves that.

But wee will be going back in time, old gold world but looked upon with modern glasses. What is evolving is the money concept. Gold is not money, gold is wealth. Money has three functions today, medium of exchange, unit of account and store of wealth (to some degree). The dollar will be the last standing reserve currency, soon a thing of the past. Oil made our economies expand immensly and we absolutely needed FIAT to accomplish that. "Oil" understood that a currency, printed at will, can not be payment in full for the worlds most valuable commodity.

So the world agreed to let the dollar be the world oil-currency so to expand the economies. The other choice was to go back to a gold standard wich would not accomplice a fast growing world. But some gold had to flow the opposite way of oil to be payment in full. Gold is cornerd by oil since decades ago. The biggest corner there ever was. Ironically one commodity cornering another.

We still live in our FIAT world but it will not last. A FIAT is by design destined to fail in the end. Paper-gold and the derivaties came into existence to hedge for a dollar that couldn´t last. A sort of make-belive to extend it´s lifespan. Some say that an ounce of gold pays for a nice suit just like in the roman times. Yes it does but something is missing in that comparsion. All the wealth that oil brought forward. It´s in that context you can understand what golds future price will be when paper-gold and derivaties have lost theire meaning. They are only an insurance sticker and will not pay out in the end. Designed to function before "gold" but not after.

What also will be gone is the illusion of paperwealth. Your wealth is not what your money says it is. Money is credit (not gold) and not wealth it self. A promise of more to come. And credit is the extending of yours or my credibility so to speak. Banks don´t create mone from nothing, they simply extend yours or my credibility. All the money and it´s derivaties in this is world is grossly overvalued compared to real assets. What is make-belive will eventually fail, always has, always will.

This brings us back to the pure money concept, a shared value in our minds. When gold is finally set free from the paperillusion of wealth all will se what real wealth is. And when that happens the three functions of money will separate. Money (FIAT) will only have two functions left for the foreseeable future, some say for a millennia or more. Money will be left with medium of exchange and unit of account. The result is finally the uniting of the soft and the hard money socialists coexisting. Gold is what prices currencies and not the other way around. Gold is wealth, store of value. It´s been out of fashion for a long time but it never disappeared.

It was always gold that was the fulcrum, the most perfect referencepoint the world has ever had. Modern man just thought it went away for good.

Put not your trust in money,
but put your money in trust.

Oliver Wendell Holmes

A tribute to the words of ANOTHER and friends FOA, Ender, Aristole and FOFOA (I understood Antoher but you made it inevitable)

Commented 4132 days ago

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Beginning of the headline :Wall Street legend Warren Buffett has famously declared that gold is not an investment. He is correct, but he stopped halfway. He did not go on to say what gold really is, perhaps purposefully intending for people to draw their own conclusions. In my view, there is only one conclusion possible, because there are only two alternatives when it comes to allocating assets in any portfolio, whether that of an individual or an institution. Your assets are either an investment, which gold is not; or m... Read More

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