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<p>[QUOTE=&quot;medoraman, post: 1030026, member: 26302&quot;]The reason there are gold reserves are a relic of the past.</p><p><br /></p><p>I do not understand how you say its fair to compare an interest earning asset with a non interest earning asset. In fact, gold is NEGATIVE interest earning since you have an expense every year to keep it safe. The price of gold in 1965 adjusted for interest rate spread between the two assets equates to a price of gold today of $532. Factor in that gold was too low in 1965 due to government intervention, and you have gold basically keeping pace with interest/inflation. Nothing more or less. Its not money its an easily stored commodity that pays no interest, in fact negative interest. Look at copper, it was probably just as good as a store of value as gold, or oil, or many other metals. Gold is just easier to store large values of in a small space. </p><p><br /></p><p>You mention anyone holding dollars and not getting interest is losing money. OF COURSE! Who holds any sizable amount of money outside an interest bearing account? Inflation has been a fact of life for at least 100 years, its not new.</p><p><br /></p><p>As for the role gold plays in currency markets, I believe its easily demonstrated that oil plays a much larger role, as it is a much more important commodity in terms of world trade.</p><p>&nbsp;</p><p>Chris[/QUOTE]</p><p><br /></p>

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