I don’t understand, if everyone gets richer while the amount of gold stays fixed, wouldn’t we expect people to choose to hold a smaller proportion of their wealth in gold?
Why would they want to hold a smaller proportion of their wealth in gold?
(It’s not like I have a desire to hold a certain volume of gold, or a certain total amount of money in gold. I think most people view it as an investment, and I don’t see why the “fraction of your portfolio you want in gold” would change that much as gold becomes more valuable.)
I desire to physically posses a limited amount of gold coins, not as investment, but as hedge against the unlikely case where civilization collapses enough that more fictional assets (gummint scrip and electronic “investments”) are worthless but not so much that more traditional value stores are (widely realized to be) worthless.
Even if most people view it as an investment, presumably the price of gold is at least somewhat tied to how much people want it for non-investment purposes (otherwise you seem to be saying that its price is a pure Keynesian beauty contest). If you are richer, the non-investment value of gold seems to be less relative to your total resources (since gold is still just gold).
I don’t understand, if everyone gets richer while the amount of gold stays fixed, wouldn’t we expect people to choose to hold a smaller proportion of their wealth in gold?
Why would they want to hold a smaller proportion of their wealth in gold?
(It’s not like I have a desire to hold a certain volume of gold, or a certain total amount of money in gold. I think most people view it as an investment, and I don’t see why the “fraction of your portfolio you want in gold” would change that much as gold becomes more valuable.)
I desire to physically posses a limited amount of gold coins, not as investment, but as hedge against the unlikely case where civilization collapses enough that more fictional assets (gummint scrip and electronic “investments”) are worthless but not so much that more traditional value stores are (widely realized to be) worthless.
Even if most people view it as an investment, presumably the price of gold is at least somewhat tied to how much people want it for non-investment purposes (otherwise you seem to be saying that its price is a pure Keynesian beauty contest). If you are richer, the non-investment value of gold seems to be less relative to your total resources (since gold is still just gold).