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Link: Two Malthusian scares

VoiceOfRa          17 February 2016 10:17 PM

Nick Szabo talks about the history of Malthusian scares, and the connection to the lack of a gold standard. The argument is rather long but the basic idea is: lack of a gold standard causes the value of the dollar to be more volatile. During the inflationary phase of the volatility people hedge against possible future inflation by holding commodities that have sufficient currency like properties, e.g., oil, phosphates, and minerals. This causes the price of those commodities to rise even when adjusted or inflation. This in tern causes some people to panic that we've reached the Malthusian limits and are reaching "peak oil", "peak phosphates", or "peak whatever".

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melian 18 February 2016 02:19 PM

The storage costs for oil are quite high and its price is even more volatile than gold. So in times of high inflation, does not it make more sense to invest in gold (or other precious metals) rather than in oil or phosphates?


VoiceOfRa 18 February 2016 07:22 PM

Well if you're Saudi Arabia you can effectively store oil underground by pumping less of it.

Also, it makes sense to hedge your bets by diversifying your investments.

Oil and phosphates have the adventage of being the limiting factors of modern industry and life respectively.