A few months back I wrote an essay entitled "What Use Is Gold?" (which is available in the archives).

Most of the personal responses I got were supportive of my position, but I was told that FSU got castigated for publishing my essay ... assumedly by gold-bugs who could not reply to me directly.

Well I see no let-up in gold-bugs promoting gold as an investment, though I stand by what I wrote earlier and have more to say on the matter.

Lately, so it is said, gold has hit an all-time high - at around $700 per ounce (I will only deal in round figures, because splitting hairs is pointless).

Back around the cusp of the 70s-80s gold hit about $700 per ounce so, indeed, in dollar terms gold is back to where it stood some thirty years ago.

Snag!

The dollar has lost about 80% of purchasing power during the same period so, if one adjusts for inflation, gold is now really selling for about $150 per ounce.

Snag!

You cannot actually spend gold - not since gold coinage became obsolete nearly a century ago - so in order to buy anything you have to sell gold for a negotiable currency, such as the USD, the pound and whatever ... which have all depreciated, but are the measure of what gold is "worth".

Of itself gold is nearly useless and, as a "store of wealth", it is abysmal.

If you bought gold at $700 per ounce about thirty years ago then, today, you would have about $150 actual purchasing power.

I daresay that when there was "the gold standard" currencies were better regulated, but there is no turning back of the tide which Nixon unleashed ... since when the "paper dollar" became the measure of all things, including gold and oil.