[ExI] [mta] Re: Bitcion Moore's Law?
Gordon
gts_2000 at yahoo.com
Mon Jul 15 21:47:07 UTC 2013
Brent Allsop <brent.allsop at canonizer.com> wrote:
>>But, unlike Bitcions, the supply [of gold] is growing, exponentially, in an equally profound accelerating law of returns way.<<
No, it is not. Gold mining companies to continue to mine, but the supply is not growing "exponentially in an equally profound accelerating law of of returns way".
The miserable performance of gold from about 1980 to about 2000 was due to other factors, namely disinflation. In the early 80s, Fed Chairman Paul Volcker broke the back of inflation and the US led the world into a long period declining interest rates and disinflation. Investors started selling precious metals to buy stocks, bonds and other instruments.
In fact, for most purposes, economists and investors consider the supply of gold to be fixed. This is one reason it has done well in recent years. As the global supply of fiat money inflates, gold becomes more valuable in terms of those fiat currencies. There is no "Moore's Law of gold," either in the supply or in the demand.
Gordon
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