What really is gold? What we are hearing at the moment is the...

What really is gold? What we are hearing at the moment is the usual cold water assessment when gold is out of favour. I.e. produces no income, only nice to look at, used to make attractive jewellery which is particularly attractive to Asian nations-that's it, full stop. Sorry gentlemen you are missing the point. This type of "new age" synthetic thinking, shaped by derivatives, calls, puts, leverage, margins and any other fancy and perhaps phoney financial instruments, has been the reason that the western world which embarrassingly considers itself "oh so smart" has lost sight of the ball.

I have spent half of the past 30 years living in Asia and I understand the human affinity with gold in general and with Asia in particular. Yes they like their showy gold jewellery some what more than in the West, but it does not end there as westeners would like to think. The answer lies in the past.

For about 16 centuries after the Roman Empire fell China was the most successful economy in the world. Then about 250 years ago with technological innovation Europe (the West) rapidly rose to world domination which is still an historical marvel. The point is that the we, the West are "Johnnies come lately"and lack that long commercial experience which say the Chinese have,which brings us to the oriental view of gold.

Wall Street and the like are making a paper meal of it -shorting etc. Does the Orient involve itself in this game- yes, but loargely only for accumulation purposes. Because of their long commercial past what is completely understood in the East is that GOLD IS WEALTH AND WEALTH IS POWER. Hence we are seeing gold pouring into China mainland vaults.Talk of casting doubt on the intrinsic value of gold , the paper market etc in the East is seen as a joke to be taken advantage of.

And that is precisely what is happening. While the "clever" West got itself into a debt trap, with insufficient gold reserves, power is now shifting to the East because the gold "immature West "has failed to see the time proven intrinsic value of gold. Currencies come and go, and the ones which we know now will also eventually disappear, but the only permanent and true money that has been there for thousands of years is gold. Failure to fully grasp this is a recipe for well...failure.

This is an MYG thread and I have said nothing specific about our fledgling company. However in current circumstances examining the nature of gold is I would suggest highly relevant as it has implications for the future POG. Furthermore I may have ruffled some feathers with my comments which imply the West, despite being highly successful in the short term, may just have been a.bit too clever by half. On a personal level that may not sit well with some of you, particularly those of you with a career in finance. No offence meant and look forward to your robust replies. That's it for now.