All the World's Gold

[MachineGhost]

[Lone Wolf]

Great chart!  That's full of interesting info.  Thanks for posting.

[Tortoise]

An average of 0.76 troy ounces of gold for each of the 7 billion people on this planet?

That's kind of interesting to think that every time we add a single 1-ounce gold coin to our portfolios, we're taking one person's entire "allotment" of the world's available gold -- and then some.

Come to think of it, there are probably quite a few villages in India that are completely deprived of their gold allotments because of PP investors' gold hoards

[WildAboutHarry]

So if this chart is accurate, gold, at least the current production, is not primarily a monetary metal.  Unless jewelry is considered monetary.

[Lone Wolf]

So if this chart is accurate, gold, at least the current production, is not primarily a monetary metal.  Unless jewelry is considered monetary.

Hmm, that's a good point.  I'd certainly thought of it as being "mostly monetary" but this would seem to contradict that.  I guess that it would be more accurate to say that it's "not primarily an industrial metal".

I also like the 2% that's "unaccounted for".  I guess it's because everyone in Abu Dhabi and Serendipity are eating it!

[moda0306]

Is jewelry maybe simply a way of flaunting your money in a literal sense?  I think of MT's year-2000 paper I-bond jacket.

Would people use gold for jewelry at its current price if it didn't have its monetary value (or maybe the other way around?)?

Maybe jewelry is simply allowing people looking to preserve wealth to kill 2 birds with one stone.

[stone]

Isn't a lot of the gold jewelry Indian 24carat jewelry that is really a financial asset. I think people their even use it as collateral to get loans etc. It is a sort of wearable savings account.

[Lone Wolf]

Isn't a lot of the gold jewelry Indian 24carat jewelry that is really a financial asset. I think people their even use it as collateral to get loans etc. It is a sort of wearable savings account.

I see what you mean there.  I wonder if culturally it is a bit "mixed use".

I imagine that if people saw me diving into the pile of gold doubloons that I have stacked floor to rafters in my living room, they might misinterpret that as only being "decorative" or "for recreation". 

[WildAboutHarry]

Isn't a lot of the gold jewelry Indian 24carat jewelry that is really a financial asset. I think people their even use it as collateral to get loans etc. It is a sort of wearable savings account.

Are those houses that people live in not a consumption item after all but a live-in-able financial asset?  Lots of those were used for collateral recently.

The whole monetary versus industrial argument for gold and silver has always missed the point with me.  Both silver and gold were widely used as monetary metals (in the sense that silver and gold were fabricated into legal tender coins), and both still are.

Use is a function of demand, and there are quite a few ounces of silver meeting the demand for a second monetary metal.  I suspect that if "All the World's Silver" chart were prepared, India, China, and the U.S. would hold similar positions to those for for gold.

[stone]

I totally agree that in the UK; houses are "live-in-financial-assets". It has screwed our country up and screwed Ireland up even more. We have vast amounts of empty housing and vast amounts of people who can't afford a place to live. The good thing about gold is that no one needs it so little harm comes from it being used as a saving vehicle.

[WildAboutHarry]

I was drawing on one of Harry Browne's comments on his radio show; he considered your home to be a consumption item, not an investment.

I'm not that familiar with the Indian jewelry market, but I have read that jewelry there is priced more by the unit of gold content and less by the design, name brand, or whatever.  If that is the case then gold jewelry could simultaneously be an investment and a "consumption" item.

For what it is worth, I think that houses have that dual role as well.  You have to live someplace, so a purchased home does provide "shelter services".  Residential real estate usually more or less paces along with inflation (sometimes way more, sometimes way less).  And when you purchase a house (with a fixed mortgage, or better yet, with cash) you have established a relatively fixed housing cost going forward.  Most of the time that is a good thing.