David Morgan says the ultimate currency is gold!
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Gold trades from the currency desks in London —’nuff said.
Actually, I don’t think so. Even if it did it is applicable primarily to Central Banks, traders, investors and the like. It is not applicable to the general public. Here is a test for you….hand any typical person a gold or silver coin and ask them to estimate its value.
They will know the answer in a millisecond if you give them a 10 dollar bill though. And they will tell you exactly what that 10 dollar bill can buy whether it is chips or Slurpees or a pack of cigarettes.
That means the man on the street understands value and does not have to struggle through the complexities of assigning worth to the thing he knows as money. With gold and silver he just has plenty of questions and no good answers except from the rabble of self proclaimed experts like yourself who want so called “honest money” to be used again.
You have got to do better to convince me. The definition of what is money and what is currency is pretty plainly stated in most dictionaries and gold does not qualify according to the standard set going back hundreds of years.
BIRD……….did you read ANDY HOFFMAN…AND JASON HOMMEL comments……when they responded to Armstrong comments…………………………………..j…………
No. What is your point J?
Gold and currency………….
GOLD IS MONEY !
Prove it Franky! See if Amazon will take it when you buy a book.
Birdman, I don’t agree with you on this one, though I always respect you views. We are getting too much into semantics here. Gold was one of the first and longest lasting currencies and fulfilled that role for thousands of years. Our current system has replaced or excluded gold from commerce, at least for most actors in the market. That does not change the definition. It is just the current fashion that has lasted I suppose since 1933 if we are realistic, the last date that there was circulating gold coinage (some might say 1971 when the USD last had gold backing of a sort).
On 15 August 1971, gold was unpegged from the US dollar, much as the Swiss franc was unpegged from the Euro last week. These events do not stop gold’s being a currency but they stop it from circulating as legal tender. Actually, strictly, gold Sovereigns are still legal tender in the UK and I would guess that old $20 pieces would be legeal tender in tne USA but since they are vastly more valuable than their face value, Gresham’s Law is the only factor preventing their being used for your daily shopping. They are hoarded instead.
OK, there are semantic definitions and Morgan perhaps should have said that gold is money and left the currency word out, perhaps.
We don’t know what is coming to us and whether our current artificial system supported by tyranny, manipulation and fraud is going to break down. Just because a Ponzi scheme can work for 100 years doesn’t mean that it will go on forever.
As it has progressed, layer upon layer of accounting standards have been abolished until we have paper assets as collateral for paper assets, with ever-more innovative financial instruments and assets being marked to model instead of marked to market – whatever is expedient to prevent or delay collapse.
We have the markets having orgasms on every little word change of the self-deified central bankers, so the confidence in the con-game is starting to crack a little, I feel. This entire system is on life support and has been so since 2008 at least, perhaps since 2000.
So in this context, it is not unreasonable to regard gold as a currency, especially since it trades on the currency boards. Even Jeff Christian who is hardly a rabid goldbug promoter would say so, since he regards the fractional reserve nature of gold trading as being the same as that of other currencies.
If I am here in Little Britain and I want to avoid the round robin of serial currency debasements, what can I do? Perhaps I can trade out of the pound into the Euro, then out of the Euro into the US dollar or the Canadian dollar or the Swiss franc and back into the Pound as there is a kind of sector rotation among the currencies, trying to keep abreast of all the different insane central bank policies and pronouncements, any of which might spring a surprise as they change just one word in their statements. Every time I will be screwed on the transaction fees and commissions. Or I could just buy gold, sit on it and forget about the whole thing. Then I have to worry only about gold versus my domestic currency. I know which I would rather do.
The stunning thing is that, despite all the industrial and technological advances since going off the Gold Standard, the Dow:Gold ratio is still below where it was going back to the 1990s, the 1970s, the 1950s or even 1929. The performance of the Dow vs gold is way inferior to what it was under the Gold Standard. The stock shills never tell you that. That is enough to tell me that there is great trouble with our current financial paradigm of irredeemable currencies and that’s all it is, a paradigm, a zeitgeist. Wait until it shifts and big things can happen.
HA HA AMAZON ! What a socialist statement and you wil love your cashless money prison ! You only know when it’s gone ! ( GOLD ) https://www.youtube.com/watch?v=ScNNfyq3d_w
Hey you are the Socialist European in the room. You guys with all your free education and easy handouts at the state expense just loving to vote for more taxation year after year to keep the trough full. I can’t stand the philosophy over there. CFS is nuts to have changed countries and then chosen Europe of all damned places….I am sure he will regret it in time.
I NO ! control what dis elite’s downing ! We are only dear slave’s ! Europe is full off suckers socialist ass likkers FULL NO ME !
When you play monopoly with your children . What money you’re using . Soo you lai ! What you think the elite play !
If the stores take Monopoly money and give me real stuff in return then it is real money Franky. but If I hand them a toothbrush and floss and claim it is cash I should not be surprised that they won’t make change. Go spend gold and get back to me with your experience. I am patient so I will wait for your answer.
GOD HELP YOU MAN ! NR 1 amazon NR 2 stores HA HA !
Money, per Jude Wanniski:
1. Medium of exchange.
2. Store of value.
3. Unit of account.
What, today, matches these three?
The dollar get 1 out of three. Gold gets 2 out of three but would absolutely get three out of three if not for government force.
There is no question the dollar is a store of value. When I put one in the sock drawer it holds its buying power until the next day. Even the next week and year. Why do you think bonds are denominated in dollars if they are not considered a store of value? Inflation objections aside, if an instrument earns interest it is of more value to me than one that does not perform or grow. Gold is flat. It is a tool for savings that does not provide income. The idea that it also does not devalue even over very long periods of time is probably its most outstanding feature. So I appreciate gold from that perspective. But I still won’t keep it around the house. Waste of space.
“There is no question the dollar is a store of value”. Suprised someone is saying that. Please!!! Cann’t help to notice this.
Of course it is a store of value. Look, if it erodes at 2% per annum why should you care when the things you bought with it bring 7% or 10% and you come out ahead? The point of a store of value is so easy to prove it is hardly worth bothering with. Your employer cuts you cheques in Canadian dollars does he not? And then you take that payment and put it in the bank. Did it degrade appreciably in the intervening hours, days or weeks?…..No?….And can you buy something with it like a mortgage payment the next month? Well then it does indeed store your labour in a liquid form. Lets get real here, we don’t lose so much buying power each year than cannot easily be overcome with even a modest effort at investing. A single lazy trade on a publicly listed stock will bring several percent return and that is easily going to offset the current 1.5% inflation rate.
So yes, cash in paper form is a store of wealth and value.
Lawrence this whole thing about “paper cash” not being a store of value is just a bloody Red Herring and a game of semantics in the gold world. If you really believed cash was no good you would not accept it in rent payments from your tenants and you would not keep any of it in your bank account.
We have to stop playing silly games with the terms.
I know the gold bugs often say that the dollar has been destroyed by the Fed and the proof is that it has declined 98% since 1913. But so what! Look what the stock market or real estate has also done in that time and look at how many more dollars the typical worker earns compared to 102 years ago.
Anyway, you are a mathematician. Don’t you know already that even after a 98% decline the dollar can still fall another 98%? That is what I am talking about when I say the gold bugs play games with words.
They are trying to imply that after a 98% fall only two percent remains and therefore we are at the end of our rope. Stupidest concept of all time. That is a ridiculous way to look at cash money and any math guy worth his salt knows it.
Haha,Bird I am surprised that you don’t know buying bond is investing not saving. The interest you get is the compensation for taking the risk. Default risk and devaluation risk both. Bond is not saving. Are you saying it just for argument purpose or you really think so? Say if you live In Africa you use USD, how do you store your value? Really little to argue about. Even Keynesian will not agree with you. Paper money is designed to lose value so poeple cannot save in the long run, so debt is reduced. I thought it is the very basic knowledge of finance. My two sons said they learnt it in high school. So my second son ask me how to invest so does not lose his money.
Bird, do you think US will pay back their national debt? I asked many Americans about it and yet I haven’t heard anyone said yes.
The point is that gold did not fall in value 98% since 1913. Some thing that only has 2% of its value left 100 years later is not a great store of value. This isn’t unique to the dollar and is true of all fiat currencies that central banks and governments drive into the ground.
If you are saving for the longer term horizon, then you’ll retain more purchasing power by parking a percentage of your earnings in the precious metals. Yes you should still acquire real estate, business ownership, stocks, bonds, and a minimal amount of fiat currency reserves. Precious metals are not as correlated to any one group and have been a constant and are still relevant or central banks wouldn’t be buying and holding so much of it. What is it that banks hold again…..oh yeah, money.
1) Don’t play with words Lawrence. Even you have heard of “Savings Bonds”
2) A dollar invested at 5% interest for 102 years since 1913 would be worth 162.00 dollars now. The people who always talk about the loss of purchasing power also conveniently forget that cash earns interest if left on deposit. Had you instead bought property, stocks, compound bearing instruments like insurance etc the final tally is obviously much greater than mere bank rates compounded. There is not even a competition as to what was a better investment, stocks or property versus gold.
3) Even if cash loses some buying power that does not negate its ability to hold value over time. Falling by 2% per annum is not the same as going to zero in one year. Again, you people just play games with words. Nobody ever said a store of value had to be a perfect store of value. The only requirement is that it preserves an ability to be spent at a later date. Dollars minted in 1913 can still be spent today.
4) Comparing 1913 incomes to today proves we are substantially wealthier in real terms in spite of the debasement of the currency. I would actually be quite a bit poorer had I only used or saved in gold all that time. Thank you very much but give me the cash because average incomes rose by a factor of 73 since 1913. That is to say that median household income of 54,000 in 2014 is a whole lot higher than the single family salary of 750 dollars in 1913. Gold on the other hand rose by a factor of 60 in the same time period and you still could not get it to pay interest! Nor could you use it to buy a bond.
5) Some of you gold people have such a poor grasp of basic finance it really baffles me you make money at all. None of you seem to add up the facts but rather you conveniently leave out important details. Interest, dividends and rents are utterly essential to the final analysis. What the hell do you think people have been doing with their surplus incomes all these decades anyway?
I dunno about store of value. You have to look out more than a day or a week. Store of value refers to savings and these are long term , like your retirement nest egg, that gets halved in 35 years due to inflation even if inflation is only 2% a year. If inflation is 4% a year it gets halved twice in 35 years. US dollar now a store of value, methinks not.
Dave, in a normal world interest rates exceed the rate of inflation. If your dollars were collecting 4% but inflation was 2% you are coming out ahead. Why do you guys always neglect the premium and compounding effect earned by long term investing whether that is in a bond, a savings account, a retirement fund or other long term paper? This is the biggest flaw in gold-think….you guys are all cup-half-empty types and only see the loss of buying power without considering the obvious gains that are usually made (even at modest levels like savings accounts that are close to break even).
There hasn’t been a “normal” world of higher interest rates since 2008/2009. There is also going to be a severe problem with the Fed or central banks raising rates in any meaningful way for years.
This is the New Normal of zero interest rates or in Europe, negative interest rates. As a result cash, savings accounts, CDS, money markets, and fixed annuities are getting creamed by inflation. This is why storing your money in PMs will be a better storage instrument than leaving it in deposit products for the next few years, and has been for the last 7 years.
It’s all about semantics in my opinion.
Bottom line is that people believe what they want to believe.
Interesting conference in Vancouver yesterday Bird.
I am seeing a very definite “changing of the guard”! I have not attended a Show since PDAC last year and the “players” are definitely getting younger!
Oh no! Don’t tell me all the gold guys of the past have just given up and quit. Maybe for them this was the last cycle they wanted to participate in so they have handed off the keys to their kids. I would have liked to be there Al. Maybe next year.
kids are only getting smarter, because someone ahead of them broke thru and did some of the hard work for them……………………………..jmho
Mike Maloney is a propagandist and a gold dealer. Hidden Secrets of Money is a slick form of advertising used to dupe weak minds. Don’t use him as your example because his bias is clearly one sided. The public has already decided and they chose to use paper currencies and electronic forms of money to complete transactions. That has been going on for decades already. It is amazing we are even having this conversation.
It’s extremely irresponsible of you to call Maloney a propagandist. Like anyone, he’s not right about everything, but his information is sound, overall. It seems very unlikely that you’ll ever entertain the idea that maybe what you think you know, just isn’t so.
Watch his videos and listen carefully to the language he uses. It is absolutely loaded with innuendo and accusations at every turn and designed to manipulate the viewers / listeners perceptions to his way of thinking. Mike rages against the machine and what he believes are inequities in life. He sure as hell has no balance though. So there is no question he is a propagandist. And not a very sophisticated one either because I personally feel revolted listening to the crap he spews.
Bird, I take things with a grain of salt. Although you make some valid points, I walk away with a few winning tips from him. Don’t be so narrow minded. He is not that bad a guy.
When he stated that the entire system is based on theft and fraud he lost my respect. What he fails to see is how the exact system he disparages was actually very beneficial to our current day wealth and standard of living. Maloney is slick alright but I would not give the guy the time of day nor sit through one of his lectures. People like him are banned from my computer. I have much better things to do if I want to watch Youtube videos.
Yes, we can all learn from Mr. Maloney. He seems to be able to the whole picture and describe the problem very nicely.
I really suggest you think for yourself and not fall for the tripe from Mike Baloney.
What he said is mostly common sense. How do I refuse common sense.
Listen to what James Turk has to say and has been saying for as long as I have known him. It is about pure and simple common sense.
It is the minority view Al. But I think James is a good guy and means well. I don’t buy the arguments of course but I will gladly listen to him if you ever get him on the show again.
The average person does know what gold is every time he / she purchases anything made of gold. The average person knows that secure savings and value are found in gold. Why, if the average person knows little of gold’s value, is the widepread saying ” Good As Gold “part of overman’s vocabulary?
Ron, we also commonly say “You can bank on it” which is an assurance or guarantee and suggests banks are absolutely secure. We do know however that thousands of banks failed during the Depression so its seems a strange expression to keep using!
As I have said a thousand times over, “a certain amount of gold in your possession makes sense if it makes you comfortable. 100% in would not make me personally comfortable.
Give me dollars any day Al. At least I can use them with little or no inconvenience. Gold…..not so much. On the other hand, if banks would again accept gold for deposit to an account I could change my mind.
Let’s say you were digging on a tropical island in the Caribbean and found a large treasure chest. If you opened it up would you hope it was full of:
A) a bunch of fiat paper currency from 17th century Spain or Portugal
or
B) a big pile of Gold & Silver
Why would the sane person want the gold& silver of the paper currency of yesteryear?
What preserved the most value in the treasure chest?
Shad, I get your point. Its a good thought experiment. Of course the gold is better in that case. I cannot argue otherwise. But who buries paper money waiting for it to appreciate after a few hundred years? We all understand (I hope) that cash is meant to be used or it withers.
The comparisons that get put forward by the gold camp are usually preposterous because they are ways to make measures against gold that do not actually happen in the real world except very rarely.
Maybe there is the oddball case of a plane hijacker who steals a million dollars and then drops out of the plane in a parachute never to be seen again. And then one day decades later somebody finds a satchel of a million dollars. OK, well sure in that case it is worth less than when it was stolen. But that is not how the vast majority of the money actually gets used.
Lets just live in the real world for the purpose of this discussion.
Most people take their salary and buy a house or other assets. Some buy stocks while others buy bonds. The smarter and more intrepid people invest in a business. So tell me about what their money returned to them in 400 years to put a different light on the scenario.
It is all good and fine to say that cash loses buying power over a few centuries but the fact is almost nobody actually saves money without interest or some other real return for its use. Cash is meant to be used or spent and it is meant to work for you, not work against you.
Let’s look at $10,000 invested since the 2008/2009 where all sectors bottomed in symphony.
1) If you had put that money in a savings account, money market, or CD at the bank, then the interest made didn’t even cover the rise in inflation (even though it has been low -reportedly around 2% but everyone knows in daily life the inflation has been more like 5-7% if energy, education, food, etc.. was taken into account).
2) If you had invested the 10,000 in Gold or Silver, then you would have more purchasing power today in 2015, than the cash in a savings account, money market account, CD, or fixed annuity. Those are the typical Savings vehicles the masses use, and millions of people left their money parked in these “savings” instruments that actually lost purchasing power to inflation. Very few bought PMs to save with, but they would have been far better off if they had. This will be true of the next 5 years as well.
Now if we ever get back to the 1970s and 1980s level of interest rates, then gold won’t be as effective as a store of value, because you are correct that at 8-15% interest then the deposit products at your bank will shine once again.
This seems very unlikely in the short or mid term (1-5 years) because central banks have painted themselves into a corner with all the quantitative easing, with no end in site. There is no way that the governments of the world can service their debt loads if they let interest rates go up, so therefore it is the Savers that will get punished to the ravages of a low but steady price inflation in the marketplace. If putting your savings in a savings account, money market, CD, or fixed annuity is a losing proposition, then people will have to store their wealth in real estate, riskier stocks, and commodities. In the commodity sector, the Precious Metals are unique in that they are commodities, but also are a store of wealth recognized by banks, and convertible to every local currency on the planet.
Shad, remember that gold and interest rates went higher together in the ’70s. Real interest rates (meaning inflation adjusted) weren’t sufficiently positive until gold had risen 25 fold. I’m not worried about rising rates now since they will be kept negative in real terms.
I agree that gold can rise with interest rates like in the 70s, but was simply making the point to Birdman that unless we see interest rates as high as the 70’s and 80’s again, then storing cash in deposit products is a losing proposition to inflation.
I am not worried about rates rising any time soon either. Like I was saying, I think the central banks have painted themselves in a corner with the money printing, making it impossible to really raise rates in a meaningful way. The Fed may do a token 25 or 50 basis point increase later this year, but then will lower it again and do more QE.
Since the collapse in 2008/2009, savers have done better to store their earnings in stocks, real estate, and PMs. I don’t see that changing for years. Cheers Matthew!
Like I said Shad “Cash is meant to be used or spent and it is meant to work for you, not work against you”.
I figured you knew, Shad. Just thought I’d take the opportunity to throw it out there again for those who might be afraid of any little nominal increase.
Cheers!
Look Matthew, the point is this,….I can say the sky is green but does that make it true? The gold community is in complete disarray when not one of you can mount an argument against my objection that gold is neither a currency nor money anymore.
The central tenet of the gold community is that gold is money but with almost no effort at all I have disproven that thesis and shown it to be wrong. Gold functions as a commodity now. Maybe it used to be money. But Conch shells used to be money too. So were sacks of salt once. Those days are gone.
And nobody has yet risen to the challenge except with bald faced assertions to claim that indeed gold is money! As if that is proof. Too damn funny man. You guys have got to get up earlier and work a lot harder to convince me.
Bird . . . “always learning but never able to come to a knowledge of the truth.” 2 Timothy 3:7
The case for gold gets weaker by the minute.
I like this one much more:
http://wiki.mises.org/wiki/Money
Dictionaries have morphed in recent decades to reflect the wishes of our Marxist Keynesian rulers. For example, as recently as the 1960s, inflation was still correctly defined as an increase in the money supply. Now, I think most only give the Keynesian “rise in the general price level.”
Mathew, I have understood inflation to be the increase in “money” supply (maybe that should say currency supply) anyway, and an increase in costs being a result of inflation.
But the meanings of words change.
I still prefer gold is money, everything else currency, but maybe I am old.
You’re understanding of inflation is correct and your last line is also 100% correct. But remember that money can and should function as currency, too.
How is gold money when you cannot exchange it at a fair value in daily buying and selling, Matthew? Like I said before, glass beads were also once money as were blocks of salt from the mines in the Afar region. Just try spending them today though. They are still recognized as proto money but you cannot get fair value anymore. Even if they were to be accepted you would face steep discounts and even suspicion. So gold cannot be money any longer except in text books because nobody can evaluate its true worth.
As a store of value, gold is superior, therefore, gold is a superior numeraire, or unit of account. It is also divisible, fungible, durable and portable. It has the most important attributes that money should have. The one that it lacks it lacks only due to government force, NOT market preference.
Mathew, yes money can function as a currency, but anything can function as a currency.
Maybe I said my last sentence wrong. Maybe should have just said gold is money, anything can be currency. Altho elephants might be inconvenient in the city.
Bird, just because gold is not being used as a currency doesn’t mean its not money.
Geez, these words money and currency sure have debate surrounding them.
I wonder if that’s a clue the banks have us right where they want us, sorta befuddled? lol
(not saying you guys are befuddled)
Matthew says: “As a store of value, gold is superior”
———-
Based on what? You cannot just say that as fact when it is just your opinion. I happen to disagree and therefore gold is not superior. See what I mean? Just because I said gold is not superior does not make it so. That is opinion….not fact.
bb says: “Bird, just because gold is not being used as a currency doesn’t mean its not money”.
————–
BB, if it is money how come we can’t spend it? Should money not be accepted by the public in order to qualify to be money? That is my central complaint. The day I can walk into Macy’s or even Walmart and slap down a couple ounces of gold and walk out with a furniture set then it is money again. Until then it is a relic of the past.
bb I agree,
But remember money wins in the end! It is the reason why everyone get’s that insurance policy. To have the power to convert your money into whatever currency you want with no timeline is priceless. The barometer set on all currency is based off of gold.
Nobody disputes that gold holds buying power Glen. We all agree though that for gold to be utilized in our time that it must first be converted into the common currency of acceptance.
Matthew is spot on with the Keynesian rulers…………dumbing down the educational system starting in the 1960………………………..
Here is the bottom line, gentlemen, “of course you can spend gold and silver you just cannot spent it conveniently. And what you get today may be less or more than you get a month from today. Does that put this silly argument at rest?”
I don’t think its a silly argument, Al. This discussion gets right to the heart of the gold investors thesis and I can readily show them they are wrong in their assertions. I am serious when I argue that gold is not a currency anymore.
Point number three is the key!
cur·ren·cy noun \ˈkər-ən(t)-sē, ˈkə-rən(t)-\
: the money that a country uses : a specific kind of money
: something that is used as money
: the quality or state of being used or accepted by many people
plural cur·ren·cies
Full Definition of CURRENCY
1
a : circulation as a medium of exchange
b : general use, acceptance, or prevalence
c : the quality or state of being current : currentness
2
a : something (as coins, treasury notes, and banknotes) that is in circulation as a medium of exchange
b : paper money in circulation
c : a common article for bartering
d : a medium of verbal or intellectual expression
Thank you bb. That hits the nail on the head perfectly. I love metals as much as the next guy you know. I just think we need to be honest with ourselves about what it is we are buying. I call gold a form of “savings” because it does indeed have a value that is undeniable. But it is surely not money anymore than glass beads and Beaver Pelts.
Because of my earlier comment, I would disagree, Bird!
Sorry Al, but it cannot meet the technical definition of money if you cannot spend it into circulation.
What I mean is this….what value is a gold coin that I know to be worth 1200 dollars when the person who will accept it in trade offers me the equivalent of half that amount? Didn’t I just lose wealth in that scenario? What I refer to is the real world where the vast majority will not or cannot accept precious metals in a transaction nor can they appreciate what the slim 1% segment of society claims that coin to be worth. Your range of options for usage are very narrow with gold and silver. So it has lost its ability to be a functional part of the money system except amongst the devotees. Pizza Hut won’t sell me a wedding banquet of meals for my gold coins. They will send me to a dealer who will strip off his percentage in the form of a discounted price and then turn my gold back into paper. That is money. And that is a currency because everybody understands it.
Trust would have to be mentioned as a part of the definition……but, maybe acceptance, ……………Jason Hommel suggested the idea of trust in his article, which is the basic idea that the USAMERICA was founded on , with a gold back currency.
I would say the Bird is quite correct at this time. Maybe he would agree with the statement that the PMs currently are “money” since they have a store of value whereas, I don’t know a civilization currently that use the PMs as currency which would entail a medium of exchange. Who knows; that may happen again.
Thank you Richard. This is an important distinction we are making. I certainly do agree PM’s are a store of value. I would not have been investing in them since the sixties if I thought otherwise. But for me they are primarily a spec instrument and i no longer have any interest in physical ownership. Been there and done that I suppose.
I disagree. Gold is money due to its characteristics. It is legitimate because its use did not have to be forced on the markets. Governments can outlaw money, but they CAN’T change what money is. If they could, then authoritarians like Lenin, Hitler, Mussolini, and FDR, wouldn’t have had to outlaw the ownership of gold by individuals who seek to protect themselves from the statist’s fraud moneys.
The hedge fund, Greenlight Capital, offers a gold denominated fund due to demand from high net worth clients who understand what money is.
Rick Rule is one of many smart individuals who calls gold what it is.
With all due respect, Rick is a gold promoter so his opinion carries no weight in this discussion.
Not realy a gold promoter at all!
Al, I like Rick. He is a very bright guy. I have no criticism of him whatsoever because I believe he has a lot of integrity. Matthew should just make his own case without always invoking the names of others though.
I think it’s relevant what smart successful “financial types” think. Doug Casey is another who knows what gold is. He would also likely consider your views on renouncing citizenship to be “serf-like.”
As many here know, Rick has proven to be very honest and careful about what he says. He did not hype the sector in 2010/11 and was bearish compared to many “analysts.” Yet I noticed he was a seller of certain juniors (ATC was one). No pumping and dumping on his part.
His integrity is not being questioned here Matthew. It is a well known fact he is a gold promoter. I only stated the obvious and so I discount your use of his name as a proof of any point you are trying to make. I did not bring him into the discussion. You did.
Bird, in your honest opinion, do you like and agree with Dr. Ron Paul? Just interested.
Can’t stand the guy. Is that blunt enough?
Thank for your honesty. That makes you a very distinct person on this site. Not sure how you found this site.
No wonder we have so much difference in our opinion, almost polar opposite. I love Ron Paul dearly and think he is the most decent human being on earth.
Each to his own Lawrence. Ron would send us to ruin though. I won’t read anything he write anymore.
You blaming the wrong person, the people who are ruining us is the people against him, those who have accumulated so much problem due to agreed and the thirst to power.
Typo, greed
Disagreeing with RP is one thing, but anyone who “can’t stand the guy” is someone I can’t stand. So it makes perfect sense how BM feels since I already couldn’t stand him.
Matt, I knew Bird’s answer already before I asked the question. That is why I said answer honestly. The reason why two groups of otherwise intelligent people arguing with each other on something trivial is not because of economy, it is more for politics. When society moves along, there will be division of ruling and ruled classes. Eventually these two parties will collide. People who benefited and people who perceive they have benefited will be for status quo and the rest will be on the opposite side. Ron Paul stands for peaceful change and people on the other side won’t tolerate him. However, history move ahead anyway.
Tyrants, even petty ones, can’t stand someone who promotes keeping one’s hands to their damn selves.
Politics is a personal thing. We sure don’t have to agree on whose opinions we value or disagree with. Why bother even asking me?
Views on gold are a personal thing too. So what?
Gold is an inert object….Ron Paul is a person. There is a big difference. If what you mean is that gold is an emotional topic then i will sure agree with that. Because of the subject this thread is now pulling more comments than a typical Weekend show. Al should get David back on. It’s a big hit Matthew! 🙂
mon·ey noun, often attributive \ˈmə-nē\
: something (such as coins or bills) used as a way to pay for goods and services and to pay people for their work
: a person’s wealth : the money that a person has
monies : amounts of money
plural moneys or mon·ies
Full Definition of MONEY
1 something generally accepted as a medium of exchange, a measure of value, or a means of payment: as
a : officially coined or stamped metal currency
b : money of account
c : paper money
2
a : wealth reckoned in terms of money
b : an amount of money
c plural : sums of money : funds
3
: a form or denomination of coin or paper money
I get your point. There is room to squeeze gold in. But its getting into a grey area since nobody actually uses it day to day except as a way to store wealth.
I think Bird is right, I also think a great part of the world is not ready to give it up yet.
When Iran sells/trades oil for gold, are they bartering or selling?
Does Iran believe they are getting money for their oil?
I would call it a commodity exchange. Iran is kind of a one-off case though. Virtually nobody else is doing the same thing. The rest are pretty much fully committed to using Fiat because Fiat works best for them and suits their interests. Iran would be doing the same thing if there had not been so many sanctions imposed.
Of course nobody is or will ever be willing to give it up!
Good point Bird, but we may yet see a currency backed with gold, from necessity, when we change the world reserve currency, the next one may have gold somehow involved to get it accepted.
Also, tho it may never happen, Mr H.S. Price is a lot closer today than he was even a year ago, to having silver made the money/currency of Mexico again.
We might be going digital, but we are not entirely there quite yet.
I am on board with calling gold “commodity money” bb. It does have pretty deep roots and we cannot minimize its importance. I just object because I know it does not trade freely in society at large nor does it have general public acceptance any longer.
That’s a good point about tradeing freely and public acceptance.
I know. It is the ace in my sleeve 🙂
The public how dasent know GOLD has nothing to sell !
Ore buy when times are hard !
You could be very correct about a currency partially backed by gold—-they may first try to connect all currencies through the usage of SDRs but over time that would be destined to failure as well.
Gold is the ultimate currency but it isn’t being used correctly by The World’s Nations. Gold needs to be accepted again as a backstop for fiat money much like a fuse is used to protect circuit breakers.
Why?
Bird, the trouble with circuit breakers is much like fiat currency. Once a circuit breaker shuts off due to an overload or a short circuit condition the circuit breaker can be reset with your hand but it never returns to it’s original factory setting. In other words you don’t get the protection implied, you don’t have the protection or value of that item once it is reused and if left unattended it will continue to shut off and eventually there will be a fire or much worse. A fuse is used to back breakers because if the short or overload is serious enough the fuse blows in the field and technicians must be sent to correct the deficiency in the breaker panel and then another fuse of the same value is replaced in the field so that you can return to a normal condition.
If you don’t have currency controls the system is open to interpretation by the various governments and central banks and you are hoping that they will be honest and greed won’t become a factor. We know what happens to fiat currencies, we have seen this since Nixon took The US off the gold standard, nothing is perfect but you can’t just print or keystroke money and go out and spend your way to prosperity. One US dollar now buys 1/1277 of a gold unit.
Great analogy DT. And I do agree on most of your points. Without question we cannot spend our way to prosperity by borrowing without end. So you and I will be in agreement on all those points. I am really just trying to impose a little discipline on the usage of words here and their definitions because they are getting used pretty loosely of late. Gold is not money by definition. Gold is certainly not a currency anymore either. I guess we just need to determine what it really is by knowing what it is not.
I think of currency as a local concept: I cannot buy a Starbucks’ coffee in Seattle with a Canadian $5 bill. I think of gold as the GLOBAL currency. Every culture understands that gold is worth A LOT and can be easily converted into the local currency for a fee that is sometimes smaller than converting from one local currency to another. Unless you live in a corrupt culture/country where fake gold is a problem (right Birdman?) The question I always ask myself: Would I rather have a Safety Deport Box filled with Gold or US dollars?
*** “Safety Deposit Box”, not a “Safety Deport Box”, although an interesting concept.
The one good point you make is that cash cannot compete with gold if it is held in a box for years on end. But why would you do that knowing it degrades in value over time? We ALL know that money loses buying power and we also all know that it is best utilized as a means to leverage other opportunities. It’s why we buy houses and hope that inflation makes our payments smaller over time. So if we all know that and play the game from both sides why do we even bother with an analogy about cash in boxes versus gold? Yes, we all get the point about cash stuffed in mattresses…but only fools and crazy people actually follow through with it. So the comparison has no valid meaning if we already know better. That’s like admitting your car battery will go dead if you don’t drive your car. So what! Go drive it then.
A Good START BIRD ! I NOW GOD LOVES YOU !
Thank you Franky. As I keep saying….if you can’t spend it then it ain’t money!
You have ignored the rest of my post. If gold can be converted into the LOCAL currency easily, then it is a currency. Since it has no attachment to any one nation-state, it is a global currency. What is confusing you?
Go check the definition of currency Brian.
I Am Groot
OK, have fun with that. Is it something you smoke?
Bird, this sounds like your describing a currency. Used to facilitate business.
Money can be used as a currency but Im still thinking gold is money.
Im a dinasour (sour) I guess.
I also recall you saying a good idea might be to have a shoebox full of bills kept around.
lol, which I think is a good idea actually.
Well, guess Im crazy but I know Im a bit foolish so Im a step ahead there.
If you have NOT resolved in your mind by now that gold and silver are currencies, read some books on the subject.
Gold, Silver, Treasury bills, bonds , stocks, etc are all assets. Central banks across the globe use these as “reserves”.
Just because you must liquidate them to the local currency, then use that local currency to purchase goods or services in that economy does NOT make it a non currency.
GREENSPAN: Yes… Remember what we’re looking at. Gold is a currency. It is still, by all evidence, a premier currency. No fiat currency, including the dollar, can match it.
Dave, I have probably read almost every word on the subject in the last 40 odd years.
BIRD WHAT YOU THINK OFF DAVE’S VIDIO ?
I find this entire debate on is gold money, or is it just a commodity to be fascinating and a truly an open acknowledgement of just how far we have fallen and our thoughts subverted as a nation that once stood on truth, principle and honor.
The freedom to choose, control our own security, exercise liberty and exercise open choice to transact in gold or whatever object/means you may wish in today’s controlled society and still be able to access and utilize the banking structures in a normal manner without subjugation of threat have long ago been removed from our collective DNA by dishonest and unprincipled interests.
The consequences of trying to use and spend historically real money (Gold) and still operate and function with in the corrupt dishonest legal tender laws system today is simply too daunting a task and far too dangerous to even contemplate for even the most adventurous. Trying to use gold as the very entity that it is (money) on the streets of the modern police state America by anyone at any level of the social pyramid is simply a life destroying endeavor in futility.
The sheer magnitude of the fraudulent and corrupt governmental edict and force through coercion of power to the point of being subjected to life long imprisonment or even death renders an honest intellectual debate fruitless in today’s modern era because a level playing field and free market movement and choice is sheer illusion and fabrication with the state controlling the game to fit their needs and the power to change any rule at any time and kill with impunity.
The all encompassing decades long brainwashing, overreach and draconian measures effectively used by governments, taught in schools and universities for decades with the prime directive of blurring and distorting the true meaning of value and what money really is in its purest form (Gold) has left a gapping rotting hole in the memory banks and cranial cortex’s of billions of bamboozled fools that on a good day in most cases barely have the functional ability to boil an egg correctly, much less understand Gold’s role, intrinsic value, usefulness and true meaning of its weights and measures in the collective consciousness of human existence.
Is Gold money? I can’t believe that is even a serious question.
V
Yes, it is frustrating this debate even occurs. Every time I hear an economist opening his mouth, my brain hurts. I feel I am quite intelligent person and yet all my common sense are rejected by modern economics. Right is wrong and wrong is right. Humanity has fallen this far, it is scary
Lawrence, I’m in complete agreement with you my friend.
Lawrence….this debate NEVER occurs. It is why I brought it up because nobody ever challenges the ridiculous, repetitive assertions of the gold crowd. I have owned substantial amounts of both gold and silver over the years. all of it has been liquidated now. My experience tells me it is best to treat it as a purely speculative commodity because I have never really been able to make money with it any other way. It is an absolute waste of time to store it or hoard it in most cases. Trading it online however can be fantastically lucrative. That is the way gold works in this world. When that changes maybe I will buy some to keep.
Well said Vortex!!
Bravo,Vortex.
Bravo.
*Groan*
Yes, +1
And Bird lost respect for Mike Maloney: “When he stated that the entire system is based on theft and fraud.” In other words, for telling the truth.
You are so brainwashed it ain’t even funny anymore.
I laughed when I got to the part about boiling an egg, Vortex!
Guys,
Not sure if any of you are following these developments but here is a link. We are living in crazy time. This smells like an assassination.
Glen, common seriously. Of course it was a hit.
I agree vortex.. It seems that power/oil/gold etc and ability to play the same game as U.S is what is at stake. The argentinians have long followed there lead.
Agree. It was a hit.
Alberto Nisman, meet Gary Webb.
What are your thoughts on this matter..
Glen, I can be saddened, angry, appalled or display twenty other human emotions of my displeasure of the events in question but the world we live in today is devoid of goodness.
Evil is coursing through the veins of the global human construct. The very fabric of a balanced world is in systemic failure as we speak and no one appears to care enough to want to put a stop to it and bring sanity back to the fore.
Not even god himself is much interested in saving this cluster**** of a planet and what we are doing to ourselves and the global killing spree that we have embarked upon.
Vortex,
I couldn’t have said it any better. Brother im with you on this. There are times I feel is it worth even being here anymore? Is it possible such creatures in the form of hatred,greed,absence of love and sanity exist? They sure do!
Such evil is bound to put mankind to the test. The test that you so much speak of. I believe God has left it up to us to defend and restore. For all he can do is watch from above.
Goodnight Im worn out.
cheers
OK my friend. Goodnight
I know of few who would not consider gold as payment, and as far as fair value is concerned, fair value is only that value people place on it. Nothing more, nothing less. Everything is always priced at fair value, that is, the price it will trade at in any given instant. He can say that gold should be $5000 per oz, but I bet your bippy he will not pay that much for it today when he can get it for $2000. $2000 is the fair price.
Or maybe 200 at the local pawn shop. That’s fair value too….10 or 15 cents on the dollar.
Final Tally
Birdman 1 —- Gold camp 0
You guys cannot mount a convincing defense. So therefore I am correct.
And just a parting comment. David Morgan did not make a fortune on silver by putting coins in his sock drawer. He did it through options and leveraged bets thus proving that all the real money was made speculating on fairly predictable changes in the price, not by being a stick in the mud and trying to get ahead by piling up kilos of junk silver and bullion or coins. In other words, the gains were all made in dollars which can readily be recycled back into what ever else is moving, not in stroring lumps of metals.
By simply storing lumps of metal, anyone smart enough to do so has smoke every other asset class since the economy peaked in 2000. $100,000 put into gold back then is now $400,000-500,000. Those who let it ride in the Dow now have about $150,000 to $170,000. And, of course, those who chose dollars just have the same $100k.
Those who dumped dollars for gold 1 month, 1 year, or 18 months ago are up 10%. Pretty damn good considering the huge rally the dollar has had.
You need to sell it to profit. Don’t forget about that good men’s suit an ounce buys. Gold will always return to its intrinsic value which has been surprisingly constant for a couple thousand years. So if you keep holding you will lose all your gains.
Re: “Gold will always return to its intrinsic value which has been surprisingly constant for a couple thousand years.” LOL —how can you say that and STILL not understand its value?!
You’re contradicting your comment above in which you stated:
Matthew says: “As a store of value, gold is superior”
———-
Based on what? You cannot just say that as fact when it is just your opinion.
———
Too funny. Btw, what value do you think paper money always returns to? El-oh-el!!!
Btw, you need to sell anything in order to profit. So…?
I never said gold had no worth or value. You clearly misunderstood the point I have been making.
And as I have said many times in the past, when you get past all the BS and rhetoric about gold the truth is that most people are here because they want to be better investors and make money……. EG…speculate and get more dollars.
Why not just can all the blather and be honest about that for a change? Nobody really cares about gold. They really just care to fatten their bank accounts which conveniently are denominated in a fiat currency they claim to despise.
Who is kidding who here?
Birdman, I believe you would consider a Swiss Franc as being currency.
In the light of that agreement, perhaps you might ponder on its acceptability for the purchase of anything in a store in the US.
I would guess you could not buy anything!
Now re-think your argument about gold, please.
VORTEX……..You get me “AAA” rating of the day for the best ……..
HONEST….
LOGICAL…
COMMON SENSE….Comments of today.
UNBIEAST
me should be my.
Thank you my friend, glad to see your still around.
Vortex,
I did not give you credit for what you wrote but here it is +1 🙂
Your a smart lad that makes sense.
Its a reserve currency CFS and a whole lot easier to sell or exchange than gold because every bank from here to Timbucktoo lists it amongst the currencies they buy and sell daily. Every airport on the planet has an exchange window that will readily convert Swiss for full value. Every city is brimming with banks that will do the same. Gold hardly gets the same attention. You must go far and wide to even remotely get fair value from the bullion and coin buyers. Are you just playing around or are you trying to be serious?
OH MY……………………….1292
Get out there and speculate J….that’s what its for.
MONEY IN THE BANK ……………BIRD………..
But be very careful…..its about to turn back down.
I BET IS does not go down to $968
IS…..to IT……………..sorry……..just got excited that there was no London Fix Slammers this morning…………………………………………..j…………:)
J read yesterdays post I gave Doc..I nailed her lol 🙂
GOOD CALL………..I think Doc better watch out…..you may get a call from the BIG OWL for a back up position with the three amigos………….:)
lol
Yup, now what?
+1
Im expecting a pull back here in gold to touch 1279/1280
Same with hui.Needs to come back and retrace. I do not like these gaps.They must fill if we want to go higher in healthy way. I think we retrace and back up.
Yeah, but still, we could just blast higher and THEN come all the way back to fill gaps and shakeout latecomers in the process.
When sideline talk picks up again, we’ll know it’s time to start buying our trading positions back. 😉
This is very true. lol
I say shake them out of the nest……………………………..lol
Are we living in a Banana Republic, Gold is now $1549.81 Canadian, our dollar is caving.
Even MSM birds are having a hard time hiding what gold really is.
http://www.reuters.com/article/2014/04/22/banks-gold-forex-idUSL6N0NE3K920140422
Matt,
What do you think so far about action in gold/hui?
We come back and fill gaps today? Gold looks like it could use a breather down to 1280
You would think we’d see it happen very soon based on the 60 min chart, but the situation seems perfect for a curve ball to be thrown at us.
I agree..Something is telling me we may have put in the high of the day for gold 1293 and hui 208. Come all the way back down to form a head for hui at 200? head for gold at 1280? Say by 12-1pm then end day 1283-1285gold 4pm and hui 204-204 4pm. Then tomorrow blast off towards 1320 gold. Just a vision but your idea sound very possible.
The only thing that would bother me with upsurge now would be the damage on the chart? It would be a big retrace back to those gaps and some of my miners charts would not look so pretty lol
Great debate. I am a bit more convinced by Bird mans arguments. Having said that, gold would not be held by central banks if they didn’t believe it has some intrinsic monitory value. I hold gold because since 2008 the financial system has been in trouble. If this system becomes worse, I agree with people like Sinclair and Turk who predict gold will be reinstated into the financial system. Should that happen, I feel that Birdy will be convinced. That is it.
Confused,
Im sure bird in the back of his mind is not ruling out someday gold becoming a peg of some sort with a new currency or many currency. We are headed in that direction and its obvious to me..
Just to add to the above i d say in that scenario gold would not retrace but hold its value and possibly increase that much further. Im of the thinking that a 25% chance of gold confiscation way down the road. I don’t trust goverments one bit.
Not going to happen……………….gold confiscation……………women are not giving up their gold wedding bands……………j…………………….
You are right Glen. Nothing is ruled out.
Glad you enjoyed it Confused! Its mostly in good fun (despite the jabs that got thrown and the eye poking). Of course, I agree with you on the issue of Central Banks holdings. Gold does play a role in the financial system even if it no longer functions properly as either money or currency. The CB’s could really hold anything they chose as a core reserve but gold is the most convenient and it has a long history of serving the purpose. So there is precedence for it. You won’t ever hear me arguing gold has no value because I would be lying if I said that. My only real point is that it has been squeezed out of the populous financial system where day to day usage is concerned. But will it come back to prominence again? Perhaps. I don’t know the future but I do agree with Jim Rickards who notes that the major CB’s are acquiring to ensure they are not empty handed should the day come that it does become a key element in a new global currency. We are not there yet but that could all change depending on how seriously the system cracks.
You called gold a relic yesterday, and I don’t believe central banks are holding and storing a relic. It is still a “universal blood donor” in heartbeat of financial transactions, second to only the US dollar (for now), but if the dollar slips and there is no other currency that can supplant the dollar, then Gold is still a medium of exchange for the banks.
It figures that Bird’s arguments would impress the Confused guy! ROTFl
No offense Confused, jk.
It’s only that he has never heard any opinion in opposition to the gold camp. Its all a one way conversation where everyone just falls in line and agrees with one another. You don’t have to like what I say in any case….I have only stated the obvious. Gold is not part of our money system for the vast majority of people around the world.
What’s to disagree with?
Yes, you have stated the obvious, gold is money only those who understand it.
Whatever….
Gold IS a relic as far as the general public is concerned. That could change of course but for now it is pretty much being ignored everywhere.
Sending out an alert to traders/investor who are thinking of jumping in here. Caution should be taken.
they should have already been in……….they have missed the bottom….
if they continue to listen to the shorts and the bears…….they will never be in…..
Agree Glen. After looking a little more closely it definitely looks like we will turn down. Probably by tomorrow. I am thinking we are going to see declines back to the 1200 zone. We shall see though. 1350 no longer looks likely….this is too steep a rise.
Bird,
Im not as bearish as you 🙂
1350-1400 soon
Of course. No problem. I have been wrong before.
A near term pullback in metals may or may not happen….very bullish action this month. Keep in mind how beat up they are over the last few years. Short covering with the right conditions could send them up 50%. Better to get long now than in a decline down there around 17.
No offense taken Mathew. I’m just happy I have some real bullion and some HUI stocks in case things get too spicy in the Fed’s kitchen;)
Smart.
Well I don’t see inflation coming.
Most don’t.
You guys have been worried about the inflation Genie for many years already. Since QE began in fact. All for naught. That theory cost a lot of people a lot of money in bad bets. And gold fell when it never materialized. We are still waiting. So what’s different now when we are in full blown deflation mode?
Ok, back to using the correct definitions. Inflation (of the money supply!) has already occurred. It took 90 years for the Fed’s balance sheet to grow to about $800B. Then 2008 hit and these “brilliant” Marxist Keynesians decide it would be smart to expand that balance sheet to about $4T in just a few years. Do you really think that price inflation (Keynes’ definition) won’t be the result?
Things you need will resume their rise while things you don’t need, and paper assets, will resume their respective declines.
Yes, I really think that price inflation will NOT be the result (in the US). Back when the whole discussion of the expansion of the money supply was a hot topic on these sites and we all worried (legitimately we thought) that a massive debasement was in the works, I really wish I had the insight to appreciate the amount of dollars the rest of the world could absorb.
Matthew, there is an insatiable demand for dollars abroad and at the low rates on offer as the Fed kept dropping rates they were consumed by the bucket loads. So there was really no way we could see inflation breaking out in the dollar based on numbers printed partly because most were actually absorbed overseas.
It would have been quite different if America was a closed economy and the currency was not the major reserve. In that case, you would be correct. Inflation would rage as a result. But keep in mind that the Fed was adding trillions in liquidity to European and other nations banks. So the energy was diffused.
More to the point…the amount of dollars printed was a bit like pissing in an ocean compared to the overwhelming deflationary effects that the Fed and other Central Banks were attempting to counter.
Those effects are still in force and as we have seen, Europe continues to see growth numbers fall despite all the interventions which included support from the Federal Reserve.
The world still has room to take up a lot more dollars. They are in demand now. But as long as they are being stored, saved, consumed and utilized outside the US there is little chance you will see inflation breaking out anytime soon inside the US.
Sorry, but we will deflate too in the end because that event has more to do with asset prices and debt than it does with mere dollar printing. I don’t think there is any way out. In the meantime, gold will not save you because it is not a deflation hedge.
Did you follow my call on wheat by the way? I picked the top to the very day. Well now it looks like its time to go long again. Starting tomorrow. The price has dropped more than 120 dollars in a running stretch for the last 30 days. This upturn that is coming is signalling something big. It usually does because when the grains rise other things fall.
Interesting point on the wheat call Birdman. Let’s migrate the discussion from gold to other commodities where we can find more common ground.
Thanks Shad. Notice the action already? It popped right on damned schedule. Wheeee! So get ready for turbulence in the metals.
Waiting for a coffee double bottom at 160. Should come into play shortly.
Had a long post that went MIA from my hand set….Sh#t.
Basically Bird you are spot on about gold as a currency. It aint period..I wont waist my time on the details. Birds got it….
Honestly CLOWNS like Bob M…. “get your money out of the banks and certs from your broker. The whole system is going to shut down” His call for a market crash in Nov I posted and laughed….. I’ve got a thousand of them from him.
Mike Baloney is another…..
and then there’s http://www.avaresearch.com/articles/1518/Exposed—Jim-Sinclair-And-Select-Gold-Pumping-Websites.html
To bad you cant see the video on the facts….Its hilarious!!!
FEAR-MONGERING. Id like to take these guys out to the wood shed….Ive got zero tolerance for these guys.
Mathew I love your technical call but we are in deflation mode….THERE WILL BE NO HYPER INFLATION John Williams…He’s been calling for it for years.
Enjoy the rally boyz and use it to evacuate…..You’ll see the gold bugs coming out of the wood work on this one…
Well, you probably already know I am going to throw cold water on Davids assertion that gold is a currency. And here is why. Gold no longer meets the definition for the meaning of the word currency.
Yeah, yeah, yeah….I know it has been used for hundreds of years.
It is NOT being used anymore though. Look this up yourself in any dictionary and the terminology is fairly clear. Gold, in order to be a currency must be something that is in common circulation as a medium of exchange and be widely accepted.
I only ask you to consider the facts that’s all. Gold is not a currency because it does not function as a currency any longer. It is not freely traded or exchanged except within a small community of users, investors, specialty funds, miners and banks.
Neither is gold money. Get David on the show again Al and have him explain how gold can be either a currency or money when it meets the criteria of neither according to current and historical definitions of what those terms mean.
I can appreciate that people here WANT gold and silver to be currencies again. But that is another issue altogether. At this point, precious metals are merely symbolic representations of money within their historical framework.
But if you cannot spend them freely and get fair value in exchange they no longer qualify.