When i look around at all the positive innovations cryptocurrency has failed to deliver, it really does seem like they invented a currency exclusively useful for doing crimes.
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I realized it was likely a profitable long term investment back when bitcoin was ~10-15$, but I objected to it on moral grounds and didn’t get involved. It’s not even something I regret, just another life choice.
I object to doing things that bring me wealth at the expense of humanity as IMO it’s just a diffuse form of theft. While you may disagree, I hope you can understand that such a stance is based on my personal morality.
Similarly buying a T-Bill may arguably support some of the horrors that the US government does, but what are the alternatives revolutions and lawless societies suck.
What about you? What do you the externalities of various investments are?
yeah that makes it easy to adhere to, while many other asset classes dont really revolve around scarcity of the asset’s existence and ownership does convey access to a productivity. I understand your criteria now.
For me I don’t have that criteria and don’t mind zero sum things. Its an entertaining and stressful player versus player match in a massive multiplayer game. Some kinds of trades I make are not zero sum, but it’s not an important distinction for me.
I do have a criteria related to human suffering: I mainly avoid exposure to some sectors like defense contracting and publicly traded prisons. Because the incentives are out of whack and dehumanize people while hoping they suffer, said in obtuse terms.
I think there is a flaw in the resource exchange logic you presented. Where you owning 1 kg of gold means the effort to extract that gold had gone to waste. In spot commodities the scarcity and continued demand at higher prices of the commodity is what justifies the further investment into extracting that commodities from harder to reach places. If a single market participant finds utility from the use of that commodity, distinct from hoarding, then acquiring access to more is beneficial. Your hoarding helped. The main difference here is that you are looking at the resource expenditure to acquire the unit you are owning, as opposed to the future utility created by the scarcity you contribute to. That’s a choice, I wonder if there is room to re-evaluate that principle, as I’m not sure we are operating on the same information.
Talking about marginal quantity for tiny fractions of a commodity get abstract so let’s scale it up and the assign a fraction of the difference to that 1kg.
Total quantity of gold in earths crust is constant, so let’s assume what changes is the timing of when a mine gets opened. IE a bit of land is either mined in 1975 vs 2025.
Everything else being equal it’s more efficient to mine today vs 50 years ago both from an effort perspective and environmental impact. EV mining equipment for example is a lot more common today than 50 years ago, they are also a lot safer. Thus removing 1kg of gold from the market for 50 years is also a dead loss.
The conclusion in your stated logic is to actually hoard as much gold as possible so that mining in the year 2075 is even more EV+ and safer.
Gold mining alone has basically zero impact on Caterpillar’s R&D into EV mining equipment. The mining industry mines vastly more copper, iron, tin, etc ore and gold is at such low concentrations it’s basically indistinguishable from other types of mining until chemical separation.
If nobody was holding gold as a store of value there’d be a glut of gold for industry and ~zero gold mining the next ~hundred years. Holding gold ultimately means mining sooner not later.
Thanks for explaining your preference.
How? Efficiency of scale can never drive marginal coasts below 0.
> You look at present energy expenditure as waste, if the asset itself is not consumed for an equally arbitrary reason that you approve of, or generates an even more valuable asset or ongoing revenue stream.
I think you’re missing my point, a gold ring may be purely decorative but people actually want the ring. A gold bar sitting in a safety deposit box for decades is there purely an investment, the nature as a physical piece of gold is essentially irrelevant the person wants is a store of value not gold. At that point why not simply leave the gold unearth and use the potential location of a mine as a store of value?
IE, for a 50 gallon drum of oil to be sitting in my basement it must have already been extracted from the earth. We don’t extract oil as fast as possible and store it because the ground itself was already storing it instead people pump faster or slower in response to market conditions that’s efficient unlike silver, gold, etc sitting in a vault.
Thus using mined gold as an investment is simply inherently wasteful, a pure dead loss for humanity.
I understand your position. It doesn’t matter that you overlook key economic relationships in environmentally friendly methods, and you don’t recognize how illiquid balance sheets drive markets through lending and collateral or consider that utility, the goal post moves to disliking the extraction method occurring at all.
I recognize that my counterpoints are all capitalist rationalizations and can be used to rationalize anything.
So I’m just watching at this point.
People have used physical oil as an investment, unrefined oil is stable across millions of years. The underlying economics mean people only attempt it in the short term when the price is unusually low. Or as a state sponsored hedge https://en.m.wikipedia.org/wiki/Strategic_Petroleum_Reserve_...