Newsflash: Warren Buffett doesn't like gold!

Okay, so it is not news.  An NFTRH subscriber mailed this Forbes piece, which quotes Buffett's shareholder letter thusly:

"Today the world’s gold stock is about 170,000 metric tons. If all of this gold were melded together, it would form a cube of about 68 feet per side. (Picture it fitting comfortably within a baseball infield.) At $1,750 per ounce — gold’s price as I write this — its value would be about $9.6 trillion. Call this cube pile A.

Let’s now create a pile B costing an equal amount. For that, we could buy all U.S. cropland (400 million acres with output of about $200 billion annually), plus 16 Exxon Mobils (the world’s most profitable company, one earning more than $40 billion annually). After these purchases, we would have about $1 trillion left over for walking-around money (no sense feeling strapped after this buying binge). Can you imagine an investor with $9.6 trillion selecting pile A over pile B?"

Said subscriber feels Warren sounds more like a shill the more he talks.  My response (for whatever it is worth):

Believe it or not Mike, I think he is right to a degree.  Gold is not an investment so much as a monetary value barometer.  I have no argument with him about the value of the other things he mentions, but what he fails to acknowledge is that there is a reason gold is at $1700/oz., and that is that it is simply holding monetary 'value' in keeping up purchasing power to these other things of value. 

So yes, he could be a shill in that he is only painting a partial picture.  Gold is simply a money surrogate that keeps up its purchasing power, unlike virtually all paper currencies.

Regards,

Gary


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