Money in Portugal
Money I Like
Use of money with intrinsic value and/or fixed
Value gold & silver culturally valued and/or understood
Sometimes whacky things happen with that paper middleman and what one can buy with it is worth less than what one gave up to get it. So, I'd like to be in a place, visit a place, where, in the event that the paper was no longer acceptable as money, that gold and silver would be. So I'm wondering if Portugal, the people of Portugal value gold and silver and if it could be used for goods and services in the event that the paper money supply became overly inflated and became actually "worth" less and less. Do people buy gold and silver jewelry, coins, bullion? Has the number of buyers increased? That's the question.
Historically, it seems that Portugal valued both gold and silver a great deal. This is not unlike other places in the world. The central bank of Portugal, like so many central banks in recent memory, has sold many tons of gold. Only a few are actually buying it. You see when there is high demand for a scarce commodity, the price goes up. As the price goes up the value goes up. In order to keep transactions that involve fiat currency it's important to keep the value of gold down, to suppress the price. Okay, so to that end the central banks have been selling gold so that the people will continue to use the paper...Maybe our labor, goods and services are worth much more than the value of the paper we accept. Now no, maybe, later yes. But if gold is old fashioned and un-spendable and clumsy then, well the paper is okay, right? Paper is okay if it has a fixed value, not if it is worth one loaf of bread today and half a loaf tomorrow and a quarter loaf the day after tomorrow.
I've been looking for clues that Portugal is cool with gold and silver. I've been looking for clues of activity that indicate that the people understand it's intrinsic value (no you can't eat it but you can exchange it for something that you can eat and it can be used in industrial, medical, and other applications...what can I do with a bit of paper? What can I do with a bit of metal? I think I can do more with the metal, it has more intrinsic value than a piece of paper.)
So far I haven't found any contemporary clues. I think it was kind of the central bank of Portugal to let us know that the gold that it has loaned to others is counted as an asset, just like the physical gold it may have in its possession. Both assets are lumped together and this type of accounting is allowed and practiced by all of the central banks. I think such revelations are a way to let the people know that they need to prepare. I wonder how many people in Portugal are listening and taking action. There are very few people here, where I am, who are taking action by accumulating gold and silver. However I believe the numbers are growing and it's just not people who have careers/formal education in economics and finance, it's people like me who have no background in the money industries at all.
(This post to be streamlined as soon as I can get some data regarding attitudes to gold & silver that are apparent in Portugal.)
