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Willem Buiter believes gold is worth nothing (zero, nihil)
That's a statement, Willem Buiter in the Financial Times: Gold is a six thousand year-old-bubble.
I don’t want to argue with a 6000-year old bubble. It may well be good for another 6000 years. Its value may go from $1,100 per fine ounce to $1,500 or $5,000 for all I know. But I would not invest more than a sliver of my wealth into something without intrinsic value, something whose positive value is based on nothing more than a set of self-confirming belief
You have to be an economist to produce a coherent piece of economic and financial theory. You have to be a top economist to produce a piece of coherent top nonsens.
4 Comments
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Jeroen
On 14 Nov, 2009
"All the other principal investment classes of the world depend on the solvency of another organisation bound up in the financial system. Gold does not. It is the quality hedge against the commonest personal financial disaster, in terms of numbers of people ruined. It is a hedge against a failure of the financial system itself."
http://www.galmarley.com/framesets/fs_gold_as_portfolio_hedge.htm
"It becomes possible to understand why gold re-materialises as the only good money in times of such great economic distress. During such a period the most valued asset is the one which is incorruptible, and because the scarcity of gold is almost uniquely beyond the power of men to change (and because it can be discreetly owned) it is gold which re-appears as the agent of wealth storage and transfer at the junctions between the much longer episodes of representative money.
At these relatively rare junction points, as the wheel of optimal monetary solutions turns through its phases, ownership of gold is what empowers a bold and contrarian few to take control of large amounts of capital. Even as gold comes back into vogue, so the seeds of the new representative fiat currency system which will subsequently replace it will start to germinate, for the simple reason that there is never enough gold to finance the opportunities for growth in a potentially successful economic state."
http://www.galmarley.com/framesets/fs_monetary_history_faqs.htm -
Jeroen
On 15 Nov, 2009
Nogmaals, bijzonder interessant toch om die compleet verdraaide redenering van Buiter te vergelijken met wat in de werkelijkheid aan de gang is:
"Madoff, Stanford and bank failures are not necessarily seen as one-offs – families clearly feel they cannot rule out the idea that the failings symbolised by these events are systemic,” according to the survey, which was conducted last month."
Geert, ik veronderstel dat jij bij je cliënteel (Econopolis) wellicht ook verder kijkt dan de jaarlijks 'percentjes' die 'hopelijk' te rapen vallen in een compleet verrot financieel systeem... . Wanneer je spreekt van 'rijkdom' die van generatie op generatie dient over te gaan, dan begrijpt de simpelste ziel wellicht al wat meer van de eigenlijk functie van een asset als 'goud'.
Quote komt uit "Super-rich buy gold and sell hedge funds", artikel in de Financial Tilmes, op http://www.ft.com/cms/s/2/cf7e4434-d03d-11de-a8db-00144feabdc0.html
En maar roepen dat goud een 6000-jaar oude bubbel is. Buiter moet natuurlijk functioneren op het podium van een toneel dat deel uitmaakt van een gigantische propagandamachine. Wiens brood men eet, diens woord men spreekt. -
Pieter Cleppe
On 15 Nov, 2009
Why is gold worth a lot however? Indeed because in the first place the market has decided so, but some have tried to sum up reasons for it:
Gold has been deemed the least imperfect material in history to represent “real value”, and supposedly to be the only material we have that meets all five essential characteristics of money, described as portability, durability, homogeneity, divisibility and value.
http://cleppe0.blogspot.com/2008/11/bring-back-gold-standard.html
http://www.dailywealth.com/archive/2008/oct/2008_oct_22.asp?printdoc=print -
Jeroen
On 17 Nov, 2009
Buiter continues:
http://blogs.ft.com/maverecon/2009/11/yapping-away-at-gold-lessons-from-the-last-days-of-the-rai/#comments
and again a nice reply:
http://jessescrossroadscafe.blogspot.com/2009/11/buiter-obsessing-on-gold.html
as it seems Buiter nowadays is also "Advisor to Goldman Sachs International (2005 - present)", his obsession with gold becomes clear to me ... (http://uk.linkedin.com/pub/willem-buiter/4/b50/745)
