alt Hacker News>Incorrect. Physical scarcity matters, but it’s not the main driver. Gold’s price is far more sensitive to interest rates, dollar strength, sentiment and fear, speculative flows.
Those are only relevant on a shorter timescale; on a long timescale gold's held its value extremely well. The price of a loaf of bread in gold now is still similar to what it was in the Roman Empire 2000 years ago.
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All value is subjective and thus at the whims of wild animal spirits.
Gold seems stable largely because the price must rise to make mining significantly more of it economically viable. Yet, were it truly stable, prices measured in terms of gold should have seen price deflation from the Roman era to now. That this is not the case proves that gold has zero intrinsic value. It may have some inherent utility, but that is not the same thing. As people want more gold for use as a conductor, or in alloys for dental prostheses, or for adornment the price will go up. Speculative demand can make the price go up. Demand for trade without USD can make the price go up.
Gold and USD prices are independent of one another. That they can be used to measure one another is also a human invention and an accident of history.
All value is subjective.
That comparison actually sounds horrible for gold... By all accounts we should be extremely more efficient in manufacturing loafs of bread. So a same amount of gold should buy lot more bread now than 2000 years ago.
So if you really think about it. If you held gold for 2000 years. You would only reach same standard of living as 2000 years ago...
So you’d be far worse off if you had put your savings in gold than in fiat currency based investments
Barely keeping up with inflation is not the win you think it is.
> The price of a loaf of bread in gold now is still similar to what it was in the Roman Empire 2000 years ago.
That seems pretty unlikely, when the price of a loaf of bread in gold now is less than half of what it was only 3 years ago.