What I personally think of gold and why its day has come and gone
I was listening to Peter Schiff on the Bad Crypto podcast last night as he espoused the virtues of gold and why he believed gold is better than Bitcoin.
Schiff argued that gold has been money for 5000 years and bitcoin has only been around for a decade.
The problem with gold is that it doesn't exist in electronic format. It is impossible to use gold to pay an invoice in China in a matter of seconds like what can be done with Bitcoin.
Gold only exists in physical format whereas Bitcoin exists in digital format.
Schiff argues that this is a positive virtue that gold has over Bitcoin. I would argue the opposite: the fact that Bitcoin exists in digital format is a virtue.
Bitcoin is a much better form of money than gold simply because Bitcoin is digital and gold is physical.
Schiff says that when you drop a gold coin on the floor you hear a noise, whereas with Bitcoin you hear nothing.
As time goes by, I am inclined to side more and more with Bitcoin than gold in this debate.
Schiff also argues that Bitcoin has no intrinsic value whereas gold does have intrinsic value.
Bitcoin does have intrinsic value because it takes computer hardware and electricity to produce it. This is essentially what backs Bitcoin: hardware and electricity and all of the other costs that go into Bitcoin mining.
With all of the money printing that has gone on over that past number of years, the gold price does not seem to be responding like Bitcoin has responded.
The gold price is essentially flat over that past ten years wheres Bitcoin is up 1000% or more, since gold peaked at $1900 in 2011.
For this reason if I were a gold investor like Peter Schiff with the majority of my wealth tied up in gold I would be a little nervous at this stage.
And like all gold investors, Schiff says that the future is quite positive for gold simply because gold is waiting to 'price in' all of the macro factors and money printing that has gone on in recent times.