Gold, Silver and Debt

  “Gold is the money of kings, silver is the money of gentlemen, barter is the money of peasants, and debt is the money of slaves” At present, I would have to say gold may not actually be considered money as the bankers find it difficult to control it, can not dilute it, and governments have a difficult time taxing it. For our purposes at this particular time in history, what should gold be to us? Now this is all my opinion and you can either agree with me, or you can simply be wrong. Gold is a concentrated store of wealth. It really is not a consumable like corn or crude oil. It can change shape but ultimately there is a finite amount of gold in the world. One can attempt to trade paper that supposedly represents gold much like the dollar supposedly is backed by the full faith and taxing authority of the US government, in the case of the dollar. We all know that is a silly notion. Gold is not an item one should buy to seek a return on or to seek an elevated value. When gold does enjoy an elevated value, it is being pegged to a paper currency that is simply going down in value in comparison to the gold. I suggest folks purchase gold and silver. In my opinion, silver will be more useful for every day living and trading. Let me illustrate. Supposing we see the dollar stumble, unemployment rises dramatically, and more and more people are on the public dole. Assuming some level of inflation kicks in, the so called value of gold would go up. Consider this, I have read that 2,000 years ago, one ounce of gold would buy 1 loaf of bread every day for a year. I don’t know what bread costs but I would think it is about 3.50 to maybe 4.50 a loaf. Let’s say $4.00 as an average times 365 days. That comes to about $1,460 so clearly gold has not really become more valuable in these last two millenia but rather everything else around gold has changed in price. There are all kinds of examples that will punch holes in that theory from the last 120 years, but overall, I believe, gold is simply a store of wealth as is silver. Consider silver at about $20 an ounce. If one were to buy a sack of junk silver, those coins are extremely difficult to forge for the average citizen where paper money is much easier. Coins from 1964 and earlier such as dimes, quarters, half dollars, and silver dollars, are around 90% silver. A sack of junk silver is $1,000 face value meaning if you have a sack of junk silver quarters, you will have about 4,000 quarters. Each sack is about 715 ounces of real silver. So it takes nearly 5 quarters to make an ounce. Divide $20 by 5 and we know, in relative terms, one quarter is worth approximately […]

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