Warren Buffett claims that gold is worthless because it doesn’t produce anything. Fair point, but what if the other sectors of the economy also stop producing?
“If you think of gold, the only way gold loses is if normal business and private sector cycles come back. If that is the case, gold goes back 100 dollars per ounce. The other outcomes—deflation, stagflation, hyperinflation—are good for gold,” said Viktor Shvets, global strategist for investment bank Macquarie Group, in an interview with Epoch Times. So gold wins in three out of four scenarios, but none of the three are particularly appealing.
He believes that aggressive action by the world’s central banks after the financial crisis has covered up a lack of private sector productivity.
