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<p>[QUOTE="fatima, post: 1351668, member: 22143"]The difference is that you don't know, with those other commodities, what other factors might affect the future "rate" vs the USD. For example the value of cotton is subject to weather conditions, competition with other very similar commodities which can directly replace it, current fashions, etc. Not to mention, it has a shelf life. Oil is subject to huge amounts of political interference, military actions, etc, changes in technology, etc. It's hugely expensive to store, transport, and maintain. </p><p><br /></p><p>There are perfectly good reasons to invest in these items, but because their primary purpose is not a hedge against currency, then the investor should be focused on the factors that will affect future price and wealth preservation due to currency collapse isn't one of them. Gold is extremely small by volume for the wealth it contains and it doesn't degrade sitting in a warehouse which makes it an excellent alternative to currency. This is why people, institutions, governments and central banks buy gold for that. </p><p><br /></p><p>Aside from that, these types of arguments completely ignore the numbers that I posted above. Silver doesn't follow Gold which of course, validates what I've said here.[/QUOTE]</p><p><br /></p>
[QUOTE="fatima, post: 1351668, member: 22143"]The difference is that you don't know, with those other commodities, what other factors might affect the future "rate" vs the USD. For example the value of cotton is subject to weather conditions, competition with other very similar commodities which can directly replace it, current fashions, etc. Not to mention, it has a shelf life. Oil is subject to huge amounts of political interference, military actions, etc, changes in technology, etc. It's hugely expensive to store, transport, and maintain. There are perfectly good reasons to invest in these items, but because their primary purpose is not a hedge against currency, then the investor should be focused on the factors that will affect future price and wealth preservation due to currency collapse isn't one of them. Gold is extremely small by volume for the wealth it contains and it doesn't degrade sitting in a warehouse which makes it an excellent alternative to currency. This is why people, institutions, governments and central banks buy gold for that. Aside from that, these types of arguments completely ignore the numbers that I posted above. Silver doesn't follow Gold which of course, validates what I've said here.[/QUOTE]
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