Oddly no. About 8% of volume of newly minted gold goes towards industrial production for the past 60 years, the rest going towards jewelry, coins, and bars. As such, all of the gold mines could be shut down for centuries and we would still have a higher stockpile then steel or copper, where about 9 months has been the standard.Gold is indeed used for various industrial and medical purposes because of its chemical properties. So it has more intrinsic value than other paper money which is simply a store of value and wouldn’t even be good toilet paper. I’m not saying that is the main driver of its price but it does provide a floor.
Prices are supposed to be set by the marginal utility of a item. Based on gold’s stockpile it’s price would be about zero. Maybe even negative once you factored in storage costs. So lower than the price if paper. Wood is a scarce resource- maybe not that scarce, but still.
No, the marginal demand isn’t being set by the industrial side of things.
Statistics: Posted by alex_686 — Tue Sep 24, 2024 7:40 pm — Replies 14 — Views 441