Would be happy to, because this is a fundamental misunderstanding of volatility based on what your shared here. It’s purely a product of liquidity and perceived assurances from the market.
In other words, the longer it doesn’t die and becomes a certainty in the minds of the market, and the larger and more liquid the global market is (which will inevitably be far greater depth than gold purely due to its fundamental characteristics) this becomes a completely meaningless criticism and it will destroy gold in this category after saturation.
The only “volatility” that will remain will be explicitly a reflection on the market conditions, not the asset itself, which will mean those changes will be critical for market balancing.
Replies (4)
A good way to think about why this analogy he is arguing is nonsense, is to realize that silver would then be less volatile than gold and thus would be the “better money,” because it has a more elastic supply.
Which essentially means, he is arguing that there is some special optimum with gold despite having no fundamental reasoning for it, or anything to compare it to.
It’s not unlike Keynesian central bankers claiming that 2% inflation is optimal, yet it’s based on literally nothing at all.
Don Brash central banker of New Zealand came up with the 2% rate
based on the fact that NZ consists of 2 islands
Please let this be true. 🤣🤣
That makes sense. His argument assumes prices need to be stable as a general rule in the first place, which I took issue with, but thought it deserved a second look. For a smart guy who has clearly read Saifedean's work, he sure is a devoted goldbug.
Thanks :)
