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Central Missouri | Ask yourself this... who is one of the largest holders of gold on earth? Well the answer mite surprise you... I believe it is the federal reserve bank of New York. There are many reasons people worldwide are turning to gold not the least of which is its historical use of money, or the fact it is easily storable, but the real reason is you can't re-produce it. The world could make lets say corn.... the hard asset money but every tom, dick, muhammed and david can grow it in their backyard thus the supply can't be constrained. So you need something that is easily storable/transportable and somethinmg that has a defined production each year. The fact that it has limited industrial use is what makes it ideal. Its supply and demand only changes by the annual new mine production. Whether you like it or not gold fits the bill for currency because you can't print it. It has for thousands of years.
Now you have to ask yourself who is buying it in massive enough quantities to drive prices higher. In 1980 the only 2 parts of the world that drove gold to 800 were the usa and mid east.
In contrast, today virtually every central bank, china, india, mid east, russia, usa and europeans are looking for a way out of storing value in fiat currencies; because they (dollar/euro) are being printed as fast as possible. Thus losing value thus the move to an easily storable, easily tradable, not able to reproduce at will store of value.
Like it or not that is the way it is.
What other commodity, substance on the earth fits these criteria?
http://globaleconomicanalysis.blogspot.com/2011/04/gold-flight-to-q...
Edited by ehoff 4/22/2011 10:01
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Why Gold from below
