Gold and the truth about the US$, page-3

  1. 175 Posts.
    Rees Moggs is a purple people eater!
    This is what Jastram really thinks about Gold.
    "The evidence drawn from the english experience for 400 years is CLEAR. Gold is NO HEDGE against inflation of a prolonged character. Even worse, it lost operational wealth consistently and seriously in each inflationary episode. In the first inflation of modern time, and the only one to have gone its complete course (1897-1920), a person would have lost 2/3rds of his operational wealth just by holding gold in bars from beginning to end. And this was in the golden age of the gold standard."

    and

    "The overall record for 1933 through 1976 has 33 annual increases in the commodity price index, with 8 occasions when gold held or gained in purchasing power. In this sense gold served as a short term hedge against price increses less than 1/4 of the time after the turning point in 1933."

    summary

    Gold poor hedge against inflation.
    Gold appreciates in operational wealth in major deflations
    Gold is an abysmal hedge against yearly commodity price increases.
    Nevertheless, gold maintains its purchasing power over LONG periods, eg, 50 year periods.
 
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