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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
 Posted - 01/21/2008 : 17:31:47
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Ross B. Hansen of Northwest Territorial Mint in his essay, "The Price of Gold Doesn't Matter". He writes, "After the past two months, it's difficult to remember that the year began with gold trading at $636.30, silver at $12.96, palladium at $335, and platinum at $1,139.50."
Now things are different, of course, but it is not just about gold. It's also about energy, and he notes that it is also hard to remember that "gasoline cost $2.38 on January 1 of 2007, according to the US Dept of Energy's Energy Information Agency. On December 31, that same fuel cost $3.10. That's an increase of 30%."
As an example, he says, "If in January of 2007 you had $637.50 to buy an ounce of gold, you could have bought 1 ounce of gold, or 267 gallons of gas. With that same $637.50 today, you could only buy about three-quarters of an ounce of gold, or 205 gallons of gas."
So why doesn't the price of gold matter? He explains, "If you were using gold as your standard, you'll discover that you can buy about the same amount of gas (actually, a little more) with the same ounce of gold you had on January 1", thus effortlessly demonstrating gold's "store of value" as it preserves buying power!
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Up or down, gold is good to hold.
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