"All That Is Gold Does Not Glitter"
Someone named Lowell Nelson of a libertarian organization called “Campaign for Liberty” is quoted in today’s The New York Times as saying:
we here in Utah ought to be able to establish a monetary system that would survive a crash if and when that happens.
He, and all of those others hoarding gold and silver against hard times make the assumption that gold and silver have intrinsic value, that there will be demand for the metals, no matter what happens.
What they don’t seem to understand is that, just like paper currency, gold and silver (as currency) act as markers, as stand-ins for the value of something else, as a convenient way of representing wealth, not really as the wealth itself. The value of gold and silver is societal, established through mutual need, not intrinsic.
Real wealth produces something, expanding one’s possessions. It works for its owner. A cow does that. Arable land does that. So does a coal mine or an oil well.
If Nelson really wants to survive a crash, he might want to stockpile the devices of sustainability. Passive-solar panels, for example. Or stockpile the materials for making glass, and the necessary equipment–while learning how to use it. Or seeds, if they can be stored adequately. These are the things that really glitter.
Better still, work to avoid the crash but helping strengthen the social fabric and the networks that we have used to support each other and to create our wealth as a whole…
Oops. I forgot: Nelson is a libertarian. He did it all by himself. He doesn’t need the support of society, of a trade system, for example, represented by gold, a marker whose value is the result of common agreement…
Oops. Not quite a libertarian concept, that.
Maybe he’d better spend a little time re-examining his beliefs. Either that, or get rid of his gold.