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A novel idea, totally baseless, and represented with an example that has little to do with instrinsic value. The intrinsic value of a house is principally related to its capacity to provide shelter. You can test this notion by putting your house into Central Australia or the Amazon Delta.
The intristic value of gold is in greed,social statusthroughout history gold has shown its value.egpytian/roman times etc etc etc gold was a show of wealth and power throughout history it has shown its strength.the paper US dollar its not goingto buy you food in the desert either in times of hunger.look whats happening around the world.Gold has a long way to run in such uncertain times.When it stops
Gold does not really have an intrinsic value, nor does money.
The fact that there is not an infinite supply of gold as opposed to the infinite supply of currency is what makes gold a hedge etc etc.
You must be more consistent with your points. You cannot say on the one hand that your business has intrinsic value, and then agree that gold has not.
It is true that we have adapted English so as to allow "intrinsic value" to be applied to specific market related concepts -particularly to put a money value on things.
In its purest sense, however, intrinsic value is the value something has because it is what it is.
Gold and property - objects - often derive value "extrinsically", ie from the perspective, or sake, of something else.
In any event, this does not help this thread unless you understand what gold means and/or what gold does.
To date your posts are erratic on these points. If you consider the intrinsic value of gold to lie "in the expectations, beliefs, and psychology of gold itself as a medium of exchange", why do so many Central Banks hold gold in vaults but never exchange it?
rederob said:To date your posts are erratic on these points.
rederob said:Pray tell how wonderful that interest rate is for you during a deflationary period.
But the proposition is somewhat unclever in a secular bull market for gold which is compounding gold's value well over 10% pa.
On the subject of this thread, however, it does seem that as gold does not attract interest it would not be a good candidate as a fiat currency after all.
You seem to have no understanding of intrinsic value from a market perspective or a theoretical perspective.
In the fullness of time you will choose to ignore me.
wayneL said:Welcome Duc( I feel some lengthy threads coming on LOL)
Typically calculating intrinsic value from a monetary perspective involves calculating "intangibles"; such things that may include reputation, intellect, patents, trademarks, research/development, and brand. The intrinsic value in these cases represents things that cannot be taken away, or things that others perceive as having an association with the object in question.
Intrinsic value from a "market" perspective is typically the value of something that cannot be taken away from it because it is what it is.
For example, an in the money derivative will have a dollar value because, as a derivative, its value is determined from its very nature (albeit extremely "temporal").
The values in your examples are simply "book value" calculations and, frankly, have nothing to do with intrinsic value per se or market-wise.
Unfortunately, as you have grasped the bull from the wrong end here there is not much point going much further. You seem to have put up arguments that convince yourself that you are right, yet they defy logic and common understandings.
By the way, it is not good form when debating a point to draw a conclusion from something that was not stated nor implied. For example, in an earlier post I talked about the “purest sense” of intrinsic value, yet you turned my statement into a “financial viewpoint”, and declared what I said was “incorrect: Very naughty tactic!
In closing here I will return to an underlying theme of this thread: The most important aspect of gold from a financial perspective is one you almost discounted, and it relates to why Central Banks hold gold. But more importantly, it relates to how much gold they actually hold, and for how long they can keep selling it.
ps. I will be very pleased if you sell me your Krugerrand (ounce of gold) for $500, or a little more to account for its intrinsic value!
Hershy said:Gols is very close to falling below the shorter term uptrend. All this talk of > $800 gold is reminiscent of 70s, the last time the experts were predicting these levels. Never happened. I come to this conclusion when I see the down moves being so much larger than the up moves. And I hold lots of TRY.
A fair effort, but nevertheless the teacher has failed you.
Everyone seems to be in agreeance that Gold prices are just going to keep going up.
The most interesting concept in AFR I thought though was that they expect Gold to reach levels it did in 1980 (due to many reasons, including geopolitical instability of which we have bucket loads of at the moment). They mention how Gold peaked at us$850 in 1980 and it will hit that again very soon, but interestingly adjusted for CPI etc its the equivalent of US$2500 an ounce now!
and its a finite resource, yet the CPI adjusted price for Gold is still very low. Technically adjusted, Gold is far from its US$2500 an ounce peak, and it seems the current climate and mood will see this want to edge closer and closer to this mark. Why shouldn't it.
My best performer, AVO, is sitting on heaps of Gold and the share price is starting to move. Gold rush, I think its about to happen and could hit US$1000 an ounce very quickly with some sharp rises (mixed with more minor pullbacks) occuring in the near future.
why is gold now US$540 an ounce,if its only a shiny metal?
Gold is the most superior conductor known to man.Future technology will use gold like never before.50+million computers per year and steadily rising,dvd players tv,s etc etc
Through history gold has always been held in the highest regard of all metals.Why would it suddenly change.Gold production has been falling gold demand rising.therefore gold price rises.uncertain times in the world helps gold even more.
but its in a bull market still in its long term upward trading channel.Ive made plenty out of gold in the last 18mths and hoping to make even more in the next couple of years/if its good dont fight it go with it.
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