jktseug wrote: divegeek wrote:
jktseug wrote:As a long term storage for monetary value it works well (unless someone is ever able to turn lead into gold).
We actually can turn other metals into stable, non-radioactive gold. It's easier to turn mercury into gold than lead, but both can be done. At present, the cost of doing it is more than the value of the gold produced, by a large factor -- about 10x. Improvements in the process could change that, though.
I actually think I remember reading something like that, but really I was thinking mass scale and value. We can turn water into hydrogen, and hydrogen is a great fuel, but that doesn't make it cost effective. Apparently it takes more energy to make the hydrogen than you will get using the hydrogen.
True, but a completely different situation.
Breaking hydrogen-oxygen bonds requires as much energy as you can get out of reassembling the bonds, by definition. With the normal losses that come about in any energy transformation process, you can only get less energy out of burning the hydrogen than you put in to obtain it. These are facts guaranteed by the laws of thermodynamics. We'd have to discover some radical new physics to change that.
Turning mercury (or lead) into gold is a different situation entirely. There's no thermodynamic requirement that it be energy-intensive. Many methods of generating fast-moving particles are energy-intensive, but not all of them, and some of them are useful for other things -- like energy generation. It's possible that no one will ever discover an approach which makes it cost-effective, but it was also possible that no one would find a way to cost-effectively manufacture synthetic diamonds, and that has happened (at least industrial-quality diamonds, and they continue to improve). No new physics is required, just really good nuclear engineering.
There are other things that could make gold a plentiful, cheap resource, too. Asteroid mining is at least a few decades away from being feasible, but when we get there gold will absolutely become dirt cheap. It's not inconceivable that some tremendously rich mine might be discovered, too.
In the short term, gold may or may not be a good investment. As others have said, the price is pretty high right now -- but you could have said that 10 years ago and everyone would nod, and the price has quadrupled since then. Could it continue going much higher? Certainly. But there are no guarantees.
Many people who buy lots of gold, however, do it on the assumption that gold is a permanently-scarce resource, and just because that has always been true in the past is no reason to believe it will always continue to be true. Until a hundred years ago it was always true that messages could travel no faster than ships or horses and people could not fly. Until 50 years ago it was always true that humans could not leave the planet. You can come up with many, many more examples.
I actually do own gold. Not physical gold; I buy shares of a gold-backed mutual fund from time to time, and I buy it as a hedge against inflation -- basically part of my portfolio which I would normally keep as cash. It's performed well for me. Not as well as some stocks, but significantly better than others. I think it's a useful part of a diversified portfolio, and doing it through a fund is convenient because there's no need to ship or store physical coins or bars.
But I wouldn't put a lot of my savings into it, and I wouldn't buy it as a hedge against disaster. I think food, ammunition, water purification equipment and other survival gear are better for that.
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