The Giant Pool Of Money. Implications

But the value of gold is itself a human value. I grant you that it currently has a few industrial uses, but certainly not enough to support its price. As with fiat currency, it could lose its value --- if, for example, everyone suddenly realized that they had no particular need for shiny rocks.The survivalist obsession with gold is particularly ridiculous. If civilization collapses, will there be any great demand for a commodity which has purely ornamental value --- with which I cannot feed myself nor fashion tools nor keep myself warm nor defend my family? I think not.Edited by Dr Adequate, : No reason given.

That's hardly a recommendation, is it? While one might applaud his consistency, anyone who's been predicting imminent hyperinflation since 1978 has spent thirty-two straight years being wrong.

Wait ... the tyrannical despots are going to let us have elections? That's silly of them. They should either have abolished them immediately or else postponed their Secret Evil Plan to make us all miserable until they had done so.They're really not very good at this whole tyrannical despot thing, are they? Having elections kinda breaks Rule #1.I'm not particularly impressed by their efforts at disarming the populace, either. Rather than actually taking anyone's guns away, which would to my naive mind seem to be the best and indeed the only way to do so, they seem to have adopted a policy of waiting for them to rust.It's almost like they're not even trying.

From this guy called Howard Ruff.Here's an excerpt from Ruff's 1978 book: Bolding mine, capitals in the original.And this guy has another direct quote: I am aware of your penchant for finding "fulfilled prophecy" in the most unlikely places, but even you must surely concede that this is pretty poor.

Hyperinflation looked imminent to him. But it wasn't. And that's another thing. Silver's now at ~ $24. But at least gold is up from then, you'll say, at ~ $1377? Only 'til you take inflation into account, when you see that it's lost 47% of its value. Meanwhile the Dow Jones average has gone from 820 to 11,105. Anyone who took Ruff's advice in 1978 would have taken a bath. Anyone who did the opposite of what he said would have made a fortune.Ruff, of course, avoided the fate of his disciples and made a fortune for himself by selling millions of copies of a book telling everyone that they should get out of the stock market and into bullion. I wonder if he's ever given anyone a refund. Whereas Ruff predicted that whoever was in power they'd preside over such a disastrous hyperinflationary spiral that their name would be a hissing and a byword for the next 50 years. So despite having being wrong about everything, he was still right?"His timing was off". Yeah, thirty-two years ago he predicted that hyperinflation was imminent. Today the inflation rate is seven times smaller than it was in 1978 and you're still waiting for him to be right ... any day now.

Weren't they at $40 and $800 back then when you were trying to make a different point? Er, no. Assuming you were right about $40 and $800, the people who kept on buying while prices rose lost (in real terms) half their investment or more (depending on whether they were more heavily into gold or silver). It's meant to be "buy low, sell high" not the other way round. If you could show me that Ruff at some point advised people to stop buying bullion because it was becoming overpriced, then I shall listen more carefully to your praise of his astuteness.

But in your message #70, you were citing them as proof that Ruff was right back in the late 70s. You wrote: And now you say that these figures were "fluky" and "short-lived" and so should be discounted.You can't have your cake and eat it. Where's the evidence for this?I wrote: But you seem to be doing it the other way round --- from the assumption that Ruff was astute, you conclude that he must have told people to stop investing in bullion.So when did he do so? Can you quote him? If he had done so, don't you think he'd be quoting it himself? And all that time, Ruff was advising people to get into silver, which is now at $24/oz after inflation.So what did he know?Edited by Dr Adequate, : No reason given.Edited by Dr Adequate, : No reason given.Edited by Dr Adequate, : No reason given.

First, his book was still on sale at the time.Secondly, if he had told his followers to get out of bullion before it got the bubble burst, surely he'd be trumpeting this success somewhere. But all the hard evidence we have is that Ruff has a long proud record of being (a) wrong (b) a goldbug. I am going on the likelihood. When and if you produce evidence that, at the right time, he went around telling people: "You should now stop buying bullion ... oh, and I was wrong about the whole hyperinflation thing", then I shall rethink.As for his "constituents", it was you yourself who spoke of people who "kept on buying while prices rose".

That's not what "sound" means. Obviously it has nothing to do with the purchasing power of the currency, otherwise you'd have to think that the US dollar was "sounder" than the US cent!Rather, it has to do with the rate of change of the purchasing power --- i.e. with inflation. The inflation rates in the 1900s were little different from those today. And the average life expectancy was 46 for men and the average wage was 22 cents an hour. What you're describing is the life of the rich --- "beautiful Victorian homes, fancy oak furnishings ... rural estates". What the average American had was poverty and squalor.You say you could buy a solid oak dining set for $30? Yes, but back then the annual wage of a schoolteacher was $325. Today you can pick up an oak dining set for ~$500, which is higher, but the annual wage of a schoolteacher is considerably higher than $5,400 (the equivalent of $325 on the oak dining set standard), meaning that s/he would be much more able to afford it.Those weren't the good old days, Buzsaw.

Although it should be noted that if you wanted to mint an aluminum coin with the same value as a one-ounce gold coin, it would weigh three-quarters of a tonne.

They were, remember? They were utterly, catastrophically wrong. Yeah, well, that would be nice. I think burning them is excessive, but I'd sanction a few public floggings.