What is one hour of your life worth? They're spent so lavishly in our youth. One after another is spent with no thought at all to the cost. Later as we become adults they're sold cheaply at first—a few dollars an hour—later in life they're usually worth more. Yet when we become old, how we do hoard those few that are left! What would a man lying on his deathbed pay for a few more of those wasted hours misspent in his youth?
The Canadian Gold Maple Leaf is the official bullion gold coin of Canada, and is produced by the Royal Canadian Mint. The brainchild of Walter Ott, it is one of the purest gold regular-issue coins in the world with a gold content of .9999 millesimal fineness (24 carats), with some special issues .99999 fine. That is, it contains virtually no base metals at all—only gold, from mines in Canada.
After forty-five years I've come to a greater understanding of value and worth. Right now on November 12, 2012 at 9:35 AM CST the price of gold is $1734.60 per ounce. If a minimum wage earning worker wanted to buy an ounce of gold it would require as much as 253.60 hours of his life to acquire the necessary money. That's assuming he claimed exemption from Federal income tax and also assuming he earned no overtime pay. What does the young worker get for six and a half weeks of labor?
I neglected to include sales tax and the obligatory dealer mark-ups in that six and a half weeks of labor estimate. The young worker will spend at least another week working for the dealer's profit and the state's taxes if not more. Such a tiny thing to hold so much value, don't you think? Why is it valuable? Is it valuable because it's rare? Lots of rare things aren't valuable. Many things are absolutely unique and yet have little or no value. I've got a finger-painting made by a particular three-year-old. No more three-year-old paintings will ever be forthcoming from my son, who's now eleven, so it's positively unique, and what's more it shows more originality and talent than some of the pricier paintings at the Louvre, but the only value this painting has is a sentimental one. Gold's greatest virtue is that it doesn't tarnish, but then again there are lots of things that don't tarnish yet are not valuable. It seems as though gold is only valuable because everybody wants it and yet there's not that much of it available. If you found yourself washed up on a desolate island with a pocket full of gold coins you would nevertheless still be one dirt-poor SOB.
Most Americans are aware that our currency is being systematically devalued. Many probably aren't aware that it doesn't have to be that way. Many probably aren't aware that since Obama took office this systematic devaluation has been kicked into high-gear. I don't value gold at all. I don't understand why others do. You can't build with it. It has absolutely no nutritional value. It doesn't even do any tricks. So I ask, what good is it? The deserted island example is my value touchstone. If I was all alone in the world, what good would gold do me?
The United States has completely abandoned the gold standard. It did this piece meal at various points and the final complete move to a 'fiat' tender was accomplished by President Nixon on August 15, 1971. If you can imagine, in those days $35.00 would buy you an ounce of gold. The price of gold since Nixon fully abandoned the gold standard has risen by 5000% Or another way of looking at it is that the value of the dollar since then has decreased by 5000%. Now to be fair, the actual value of gold prior to 1971 had been kept artificially low:
From 1940 to 1957 the US Treasury’s gold reserves remained relatively constant but by 1958 they started falling. Within three years, by 1960, Treasury gold reserves had declined as much as twenty two percent. Just as the increase in gold reserves from 1935 to 1940 indicated that gold was overvalued and the dollar was undervalued, the decline in reserves after 1957 indicated that the dollar was now overvalued, and gold was undervalued.I've already mentioned that a troy ounce of gold is worth $1734.00. The United States owes 16 trillion. So how many metric tonnes of gold would the USA have to pile up to pay off our national debt? 16 trillion divided by the price of gold per ounce ($1734.00) divided by 14.58333333 (the number of troy ounces in one pound) divided by 2204.62 (pounds in a metric tonne) = 287164.58 tonnes of gold.
It was becoming more and more difficult for the European and American Reserve Banks to maintain the gold price at $35 an ounce. In 1961 the situation was severe enough that the United States, Britain, West Germany, France, Switzerland, Italy, Belgium, the Netherlands and Luxemburg all agreed to sell gold into the market to try and prevent the price from exceeding $35 an ounce; and so the London Gold Pool was created.
The French, who were smart enough to realize that the London Gold Pool was a losing proposition, eventually started selling francs for dollars and sent the dollars back to the United States in exchange for gold.
By 1968, when the London Gold Pool croaked, US gold reserves had declined more than fifty two percent from their 1957 levels. In 1971 US gold reserves were 9,070 tonnes, only seventy-two tonnes more than they had been in 1935. It was clear that thirty-five dollars were no longer worth an ounce of gold.
A total of 165,000 tonnes of gold have been mined in human history, as of 2009. This is roughly equivalent to 5.3 billion troy ounces or, in terms of volume, about 8500 m3, or a cube 20.4 m on a side. The world consumption of new gold produced is about 50% in jewelry, 40% in investments, and 10% in industry.Obviously if the USA was forced to account for this 16 trillion dollars in debt today and pay it back in gold we couldn't do it. That much gold doesn't exist. It may never exist. The United States gross domestic product is about 15 trillion annually. We've got a little over one trillion dollars in circulation, with a hundred trillion or more in assets held by the public and private sectors combined. If the world were still on a gold standard and if we assumed that the value of all assets on Earth are worth roughly ten times that of the USA or one quadrillion dollars, then the price of gold today would be nearly $100,000 an ounce. The demand for gold to back the amount of currency necessary to provide a liquid market for a quadrillion's worth of assets would cause the price of gold to skyrocket north of $100,000 an ounce.
Worth is always such a relative thing, though. What is water worth to a dying man stranded in the desert? There are things that always have some value: food, drink, and shelter. Nothing else holds any value when one of these three is sorely lacking. Each of them represents something that's not at first completely obvious. These three things [food, drink, shelter] represent time worked, whether that is building, hunting, foraging, fishing, farming, herding, gathering, chopping, carrying, sewing, shaping, carving, and on and on. Containers are required to hold the food and drink. Wood is required to heat the shelter and cook the food. Plates, cups, tables, jars, bins, are needed to hold the food and cook it in and serve it on. All these assets have some intrinsic value that varies depending on a variety of factors. All represent time worked.
On the other hand, the value of those things considered much more valuable than mundane necessities seems to be determined by opinion alone. To me it appears that random chance alone is the primary determining factor. Gold is one such example. The lucky miner finds gold after digging for only an hour. The unlucky miner digs for a lifetime and finds nothing. Gold represents then not so much hard work as it does good luck. Musicians in a band might play nightclubs for a lifetime and be quite talented and hardworking yet they merely get by night-by-night eking out a bare living. Meanwhile a new boy-band playing its first set ever is discovered and a Justin Beiber walks onto the world stage. Luck? What else? Musicians, actors, writers, and athletes all provide some form of entertainment value to an audience, and without exception each of these fields requires innate talent, hard work, and a great deal of luck to achieve that lucky pinnacle where the top performers in their respective fields reap the kind of wealth the rest of us merely dream of. So now talent, hard work, and luck abide, these three; but the greatest of these is luck.
Now, finally, after hundreds of words I've come full circle, back to a fundamental understanding of why people are the way they are and why they do what they do and vote the way that they vote. Most people believe their hours are worth far more than what they get for them. The envious Democrats are those who—without a doubt—consider the wealthy merely lucky. Stop and think about it...There but for the curse of misfortune go I. The rich were lucky. They didn't earn that. It was handed to them on a silver platter or perhaps on a roll of the dice. Is it any wonder that those who benefited so greatly from luck and those without any luck at all, have banded together against those who are geniuses at making a product that people want to buy, or astutely analyzing an inefficient market to buy what's too cheap and sell what's too dear?
In a words of one sentence, Democrats are the few winners and the many losers who spend their lives worshipping at the altar of fortune in the great casino of life, while the Republicans are the ones who simply save their money and buy shares of that casino.