World Gold Supply

<a href="http://www.numbersleuth.org/worlds-gold/"><img src="http://www.numbersleuth.org/worlds-gold/gold.jpg" alt="All The World's Gold" width="500" border="0" /></a><br />From: <a href="http://www.numbersleuth.org">Number Sleuth</a>

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Embed this infographic on your site! <a href="http://www.numbersleuth.org/worlds-gold/"><img src="http://www.numbersleuth.org/worlds-gold/gold.jpg" alt="All The World's Gold" width="500" border="0" /></a><br />From: <a href="http://www.numbersleuth.org">Number Sleuth</a> All The World's Gold We here at NumberSleuth are all about exploring the world of numbers, and with this infographic we decided to take a look at the numbers behind the entire amount of gold in the world. Below are a series of questions that we began with and the answers we discovered in our research. We believe that this is the most thorough and in-depth resource about the world's gold on the Internet and we hope you have as much fun reading through the information as we did in putting it all together. 1. How much above-ground gold (gold that has been mined) is there in all the world? The best estimate at the end of 2011 is that around 165,000 metric tons (or tonnes) have been mined in all of human history. That’s about 181,881 ordinary tons or 363,762,732 pounds, or 5,820,203,717 ordinary ounces. Gold typically is measured in what are known as troy ounces, which are a little bigger than ordinary ounces (a troy ounce is 31.1034768 grams whereas an ordinary ounce is 28.3495231 grams). There are 32.1507466 troy ounces in a kilogram or 32,150.7466 troy ounces in a metric ton. “More than half of all humanity’s gold has been extracted in the past 50 years. Now the world’s richest deposits are fast being depleted, and new discoveries are rare. Gone are the hundred-mile-long gold reefs in South Africa or cherry-size nuggets in California. Most of the gold left to mine exists as traces buried in remote and fragile corners of the globe. It's an invitation to destruction. But there is no shortage of miners, big and small, who are willing to accept.” [QUOTE SOURCE: http://ngm.nationalgeographic.com/print/2009/01/gold/larmer-text.] SOURCES: http://ngm.nationalgeographic.com/print/2009/01/gold/larmer-text, http://www.gold.org/about_gold, and http://minerals.usgs.gov.   2. How much gold gets mined per year worldwide? The table below shows world gold production from 1900 thru 2011. Production in 1900 was around 400 metric tons per year and has consistently moved up over the years. It is currently around 2,500 metric tons per year. The all time high was reached in 2001, with 2,600 metric tons of gold production worldwide. The total gold mined from 1900 to the present is just under 141,000 metric tons. Given that humans have mined a total of 165,000 metric tons over the course of history, that leaves just 24,000 metric tons mined before the 20thcentury. SOURCE: http://goldratefortoday.org/world-gold-production-1900-2010. Year World Production (in metric tons) Average Price Total Dollar Value by Year Troy Ounces per Year 1900 386 $ 18.96 $235,297,168.04 12,410,188.19 1901 395 $18.98 $241,037,362.33 12,699,544.91 1902 451 $18.97 $275,064,748.01 14,499,986.72 1903 496 $18.95 $302,191,297.44 15,946,770.31 1904 526 $18.96 $320,638,109.81 16,911,292.71 1905 575 $18.92 $349,767,972.26 18,486,679.30 1906 608 $18.90 $369,450,659.33 19,547,653.93 1907 623 $18.94 $379,366,592.60 20,029,915.13 1908 668 $18.95 $406,983,440.91 21,476,698.73 1909 687 $18.96 $418,780,192.85 22,087,562.91 1910 689 $18.92 $419,113,274.59 22,151,864.41 1911 699 $18.92 $425,196,195.84 22,473,371.87 1912 705 $18.93 $429,072,611.36 22,666,276.35 1913 694 $18.92 $422,154,735.22 22,312,618.14 1914 663 $18.99 $404,789,795.47 21,315,945.00 1915 704 $18.99 $429,822,045.27 22,634,125.61 1916 685 $18.99 $418,221,734.38 22,023,261.42 1917 631 $18.99 $385,252,429.78 20,287,121.10 1918 578 $18.99 $352,893,667.85 18,583,131.53 1919 550 $19.95 $352,774,067.07 17,682,910.63 1920 507 $20.68 $337,092,861.92 16,300,428.53 1921 498 $20.58 $329,507,857.78 16,011,071.81 1922 481 $20.66 $319,496,758.31 15,464,509.11 1923 554 $21.32 $379,741,470.30 17,811,513.62 1924 592 $20.69 $393,797,776.72 19,033,241.99 1925 591 $20.64 $392,182,523.21 19,001,091.24 1926 602 $20.63 $399,288,481.22 19,354,749.45 1927 597 $20.64 $396,164,071.66 19,193,995.72 1928 603 $20.66 $400,533,358.13 19,386,900.20 1929 609 $20.63 $403,931,370.54 19,579,804.68 1930 648 $20.65 $430,215,570.40 20,833,683.80 1931 695 $17.06 $381,201,757.21 22,344,768.89 1932 754 $20.69 $501,560,006.15 24,241,662.94 1933 793 $26.33 $671,297,622.28 25,495,542.05 1934 841 $34.69 $937,975,205.02 27,038,777.89 1935 924 $34.84 $    1,035,001,978.67 29,707,289.86 1936 1,030 $34.87 $    1,154,729,429.96 33,115,269.00 1937 1,100 $34.79 $    1,230,376,921.64 35,365,821.26 1938 1,170 $34.85 $    1,310,930,617.24 37,616,373.52 1939 1,230 $34.42 $    1,361,153,298.51 39,545,418.32 1940 1,310 $33.85 $    1,425,676,631.86 42,117,478.05 1941 1,080 $33.85 $    1,175,366,994.20 34,722,806.33 1942 1,120 $33.85 $    1,218,899,105.10 36,008,836.19 1943 896 $33.85 $975,119,284.08 28,807,068.95 1944 813 $33.85 $884,790,153.97 26,138,556.99 1945 762 $34.71 $850,355,739.84 24,498,868.91 1946 860 $34.71 $959,719,076.46 27,649,642.08 1947 900 $34.71 $    1,004,357,173.04 28,935,671.94 1948 932 $34.71 $    1,040,067,650.30 29,964,495.83 1949 964 $31.69 $982,178,302.00 30,993,319.72 1950 879 $34.72 $981,204,777.40 28,260,506.26 1951 883 $34.72 $985,669,873.08 28,389,109.25 1952 868 $34.60 $965,576,942.49 27,906,848.05 1953 864 $34.84 $967,794,057.97 27,778,245.06 1954 965 $35.04 $    1,087,132,485.23 31,025,470.47 1955 947 $35.03 $    1,066,549,898.77 30,446,757.03 1956 978 $34.99 $    1,100,205,621.82 31,443,430.17 1957 1,020 $34.95 $    1,146,141,965.54 32,793,761.53 1958 1,050 $35.10 $    1,184,915,765.94 33,758,283.93 1959 1,130 $35.10 $    1,275,195,062.40 36,330,343.66 1960 1,190 $35.27 $    1,349,408,630.77 38,259,388.45 1961 1,230 $35.25 $    1,393,975,995.71 39,545,418.32 1962 1,290 $35.23 $    1,461,145,335.51 41,474,463.11 1963 1,340 $35.09 $    1,511,747,395.58 43,082,000.44 1964 1,390 $35.10 $    1,568,602,775.87 44,689,537.77 1965 1,440 $35.12 $    1,625,953,277.65 46,297,075.10 1966 1,450 $35.13 $    1,637,710,805.68 46,618,582.57 1967 1,420 $34.95 $    1,595,609,403.01 45,654,060.17 1968 1,440 $39.31 $    1,819,938,022.34 46,297,075.10 1969 1,450 $41.28 $    1,924,415,088.49 46,618,582.57 1970 1,480 $36.02 $    1,713,943,440.95 47,583,104.97 1971 1,450 $40.62 $    1,893,646,823.99 46,618,582.57 1972 1,390 $58.42 $    2,610,762,796.76 44,689,537.77 1973 1,350 $97.39 $    4,227,067,635.35 43,403,507.91 1974 1,250 $      154.00 $    6,189,018,720.50 40,188,433.25 1975 1,200 $      160.86 $    6,206,122,917.69 38,580,895.92 1976 1,210 $      124.74 $    4,852,685,798.37 38,902,403.39 1977 1,210 $      147.84 $    5,751,331,316.59 38,902,403.39 1978 1,210 $      193.40 $    7,523,724,814.85 38,902,403.39 1979 1,210 $      306.00 $  11,904,135,436.12 38,902,403.39 1980 1,220 $      615.00 $  24,122,705,173.98 39,223,910.85 1981 1,280 $      460.00 $  18,930,359,598.08 41,152,955.65 1982 1,340 $      376.00 $  16,198,832,166.94 43,082,000.44 1983 1,400 $      424.00 $  19,084,683,181.76 45,011,045.24 1984 1,460 $      361.00 $  16,945,372,503.00 46,940,090.04 1985 1,530 $      317.00 $  15,593,433,608.47 49,190,642.30 1986 1,610 $      368.00 $  19,048,674,345.57 51,762,702.03 1987 1,660 $      447.00 $  23,856,496,992.13 53,370,239.36 1988 1,870 $      437.00 $  26,273,268,614.05 60,121,896.14 1989 2,010 $      381.00 $  24,621,363,253.75 64,623,000.67 1990 2,180 $      383.51 $  26,879,689,566.27 70,088,627.59 1991 2,160 $      362.11 $  25,146,950,798.86 69,445,612.66 1992 2,260 $      343.82 $  24,982,197,512.99 72,660,687.32 1993 2,280 $      359.77 $  26,372,472,957.76 73,303,702.25 1994 2,260 $      384.00 $  27,901,703,929.34 72,660,687.32 1995 2,230 $      383.79 $  27,516,271,133.88 71,696,164.92 1996 2,290 $      387.81 $  28,552,592,579.19 73,625,209.71 1997 2,450 $      331.02 $  26,074,223,341.85 78,769,329.17 1998 2,500 $      294.24 $  23,650,089,198.96 80,376,866.50 1999 2,570 $      278.98 $  23,051,397,286.22 82,627,418.76 2000 2,590 $      279.11 $  23,241,610,748.33 83,270,433.69 2001 2,600 $      271.04 $  22,656,759,732.01 83,591,941.16 2002 2,550 $      309.73 $  25,393,029,398.27 81,984,403.83 2003 2,540 $      363.38 $  29,674,663,280.75 81,662,896.36 2004 2,420 $      409.72 $  31,878,185,430.62 77,804,806.77 2005 2,470 $      444.74 $  35,317,845,915.92 79,412,344.10 2006 2,370 $      603.46 $  45,982,004,217.47 76,197,269.44 2007 2,360 $      695.39 $  52,763,246,120.49 75,875,761.98 2008 2,290 $      871.96 $  64,198,237,862.22 73,625,209.71 2009 2,450 $      972.35 $  76,591,357,218.45 78,769,329.17 2010 2,500 $  1,224.53 $  98,423,884,335.25 80,376,866.50 2011 2,500* $1,560.85** $        125,456,232,076.53 80,376,866.50   *Estimated value for 2011. **Cumulative average thru November 22, 2011, http://www.kitco.com/scripts/hist_charts/yearly_graphs.plx. SOURCE: This table thru 2009 appears here: http://minerals.usgs.gov/ds/2005/140/gold.pdf.   3. But didn’t the Spanish get lots and lots of gold from the New World, especially from the Aztecs and Incas? In fact, the Spanish got much more silver than gold from the New World. In the 16th century, when production was in full swing, the Spanish only got 154 metric tons of gold, whereas they got 7440 metric tons of silver. Gold production in the new world for the entire the 16thcentury was thus less than half of what it was worldwide in 1900. Here is a comparison, decade by decade, of Spanish gold and silver production in the New World in the 16th century: Year value in millions of pesos gold (in metric tons) silver (in metric tons) 1503-1510 1.18 5 0 1511-1520 2.18 9.2 0 1521-1530 1.17 4.9 0 1531-1540 5.58 14.5 86 1541-1550 10.46 25 178 1551-1560 17.86 42.6 303 1561-1570 25.34 11.5 943 1571-1580 29.15 9.4 1119 1581-1590 53.2 12.1 2103 1591-1600 69.6 19.5 2708   SOURCE: http://mygeologypage.ucdavis.edu/cowen/~GEL115/115ch8.html   4. How much gold, really, is 165,000 metric tons (the total mined throughout human history) and 2,500 metric tons (the total that’s currently mined annually)? An Olympic swimming pool is 50 by 25 by 2 meters. It therefore contains 2,500 cubic meters of water. Each cubic meter of water is one metric ton. Gold is 19.3 times as dense as water. Therefore an Olympic swimming pool would contain 48,250 metric tons of gold. It follows that 3.42 Olympic-sized swimming pools could contain all the gold that’s ever been mined. Another way to imagine this is to think of all the gold in the world ever mined as a single cube. That would be a cube with each side just over 20 meters, or 67 feet, in length. Given that about 2,500 metric tons of gold is mined each year, this annual production of gold would fit in a cube whose sides were 5 meters, or 16.6 feet, in length. All the production of gold in the world for a given year would thus fit in a 20 by 30 foot room with an 8 foot ceiling.   5. Given 165,000 metric tons as an upper bound on available gold, how much does that leave to each human on the planet? Humanity has just hit the 7 billion mark. That leaves just under 24 grams of gold to each person on planet earth, or .76 troy ounces or .83 ordinary ounces per person. In an ordinary male gold wedding band at 18-karat purity, there are about 5 grams of pure gold. That means every person on planet earth could own about 5 gold rings. At the current price of $1,750.00 per troy ounce of gold, that leaves $1,326.00 in gold for each person on planet earth. “Gold production has increased by a factor of 2.1 from 1959 to 2010. At the same time, the world population has been multiplied by a factor 2.2. Thus we produced more or less the same amount of gold per inhabitant as in 1959.” [QUOTE SOURCE: http://news.goldseek.com/Dani/1309290922.php)   6. How does the gold that’s mined get used? 52 percent gets used for jewelry, 18 percent constitute official holdings (as in central banks of nations), 16 percent take the form of investments, 12 percent find industrial uses, leaving 2 percent unaccounted for. SOURCE: http://dollardaze.org/blog/?post_id=00479&cat_id=20   7. Which nations consume the most gold? Since jewelry is the most common use of gold, gold consumption worldwide is most easily gauged by gold jewelry consumption. India is in this respect far and away the biggest consumer of gold. Here are the data for 2009 and 2010 of gold jewelry consumption by country in metric tons: Country 2010 2009 % Change India 745.7 442.37 69 Greater China 428 376.96 14 United States 128.61 150.28 -14 Turkey 74.07 75.16 -1 Saudi Arabia 72.95 77.75 -6 Russia 67.5 60.12 12 United Arab Emirates 63.37 67.6 -6 Egypt 53.43 56.68 -6 Indonesia 32.75 41 -20 United Kingdom 27.35 31.75 -14 Other Gulf Countries 21.97 24.1 -10 Japan 18.5 21.85 -15 South Korea 15.87 18.83 -16 Vietnam 14.36 15.08 -5 Thailand 6.28 7.33 -14 Total 1805.6 1508.7 20 Other Countries 254 251.6 1 World Total 2059.6 1760.3 17   SOURCE: See “Full Year 2010 Gold Demand Trends Report” available at http://www.gold.org/media/press_releases/archive/2011/02/global_gold_demand_in_2010_reached_a_10_year_high_in_tonnage_and_all_time_high_in_value/ as well as http://www.forexyard.com/en/news/Gold-jewellery-consumption-by-country-2011-02-28T130619Z-FACTBOX.   8. Where does the world’s gold get produced? Here is the breakdown of 100 top gold-producing nations in the world for 2009. China sits at the top, with the United States the runner up: 2009 Production by Country 2009 (in kilograms) 1 China 320,000 2 United States 223,000 3 Australia 222,000 4 South Africa 197,698 5 Russian Federation 190,693 6 Peru 182,391 7 Indonesia 130,000 8 Canada 97,367 9 Uzbekistan 90,000 10 Ghana 86,000 11 Papua New Guinea 66,000 12 Brazil 60,000 13 Mexico 51,393 14 Colombia 47,837 15 Argentina 47,000 16 Mali 42,000 17 Chile 40,834 18 Tanzania, United Republic Of 40,000 19 Philippines 37,047 20 Kazakhstan 22,000 21 Guinea 18,083 22 Kyrgyzstan 16,950 23 Burkina Faso 13,500 24 New Zealand 13,442 25 Suriname 12,193 26 Turkey 12,000 27 Venezuela 10,500 28 Mongolia 9,803 29 Guatemala 8,485 30 Guyana 8,183 31 Mauritania 8,000 32 Japan 7,000 33 Finland 7,000 34 Bolivia 7,000 35 Côte D'ivoire 6,573 36 Senegal 5,600 37 Saudi Arabia 5,500 38 Sweden 5,000 39 Lao People's Democratic Republic 5,000 40 Zimbabwe 4,200 41 Bulgaria 4,200 42 Spain 3,450 43 Nicaragua 3,400 44 Ethiopia 3,400 45 Viet Nam 3,000 46 Thailand 3,000 47 India 2,800 48 Malaysia 2,794 49 Uruguay 2,180 50 Honduras 2,127 51 Ecuador 2,092 52 Namibia 2,022 53 Congo, The Democratic Republic Of The 2,000 54 Korea, Democratic People's Republic Of 2,000 55 French Guiana 2,000 56 Niger 2,000 57 Georgia 2,000 58 Botswana 2,000 59 Sudan 1,922 60 Cameroon 1,600 61 Uganda 1,600 62 Zambia 1,500 63 France 1,500 64 Tajikistan 1,361 65 Morocco 1,200 66 Denmark 1,117 67 Fiji 1,040 68 Algeria 1,010 69 Armenia 944 70 Poland 814 71 Panama 800 72 Burundi 750 73 Liberia 600 74 Mozambique 511 75 Serbia 500 76 Costa Rica 500 77 Greece 500 78 Italy 450 79 Iran, Islamic Republic Of 400 80 Romania 400 81 Azerbaijan 353 82 Gabon 300 83 Kenya 300 84 Nigeria 200 85 Sierra Leone 200 86 Equatorial Guinea 200 87 Slovakia 200 88 United Kingdom 185 89 Korea, Republic Of 175 90 Dominican Republic 173 91 Myanmar 100 92 Chad 100 93 Congo 100 94 Madagascar 70 95 Eritrea 30 96 Oman 28 97 Rwanda 20 98 Benin 20 99 Central African Republic 10 100 Belize 5   SOURCES: http://www.indexmundi.com/minerals/?product=gold&graph=production and http://www.indexmundi.com/en/commodities/minerals/gold/gold_t8.html. See also http://www.dani2989.com/gold/goldproduction2011gb.html.   9. What’s happening with gold prices? The trend since 1900 has been rising gold prices with occasional sharp volatility. See the table in question 2 for the history of gold prices from 1900 to the present. Here is a graph of gold prices over the last fifty years, which includes also gold prices adjusted for inflation: SOURCES: http://en.wikipedia.org/wiki/File:Gold_price_in_USD.png and http://minerals.usgs.gov/ds/2005/140/gold.pdf. Here’s what’s happened with gold prices in the last decade: SOURCE: http://www.kitco.com. Here’s what’s happened with gold in the last year (2011): SOURCE: http://www.kitco.com.   10. Who’s got the gold that’s used for monetary and investment purposes and how much of this type of gold is out there? In 2011, about 2,100 metric tons of gold appeared in what are known as exchange-traded funds (ETFs). The lion’s share was in one fund: 1,240 metric tons in SPDR Gold Shares (http://www.spdrgoldshares.com). As of 2009, the International Monetary Fund (IMF) held 3,217 metric tons of gold. In 2010, the central banks of nations held a total of 28,398 metric tons of gold. Here is the breakdown: Gold Reserves in Central Banks metric tons % of forex reserves value @ $1750 per troy oz. 1 United States USA                                       8,133.50 74.70% $457,621,670,574.43 2 Germany                                       3,401.00 71.70% $191,353,206,076.55 3 Italy                                       2,451.80 71.40% $137,947,600,899.29 4 France                                       2,435.40 66.10% $137,024,874,471.87 5 China                                       1,054.10 1.70% $59,307,678,484.36 6 Switzerland                                       1,040.10 16.40% $58,519,985,192.66 7 Qatar                                          950.30 7.10% $53,467,495,364.47 8 Russia                                          775.20 6.70% $43,615,702,837.56 9 Japan                                          765.20 3.00% $43,053,064,772.06 10 Netherlands                                          615.50 59.40% $34,630,372,931.53 11 India                                          614.80 8.10% $34,590,988,266.94 12 Republic of China (Taiwan)                                          466.90 4.60% $26,269,571,278.20 13 Portugal                                          421.60 81.10% $23,720,820,841.48 14 Venezuela                                          401.10 52.40% $22,567,412,807.21 15 Saudi Arabia                                          322.90 3.00% $18,167,583,135.00 16 Iran -- Islamic Republic of Iran                                          320.00 0.00% $18,004,418,096.00 17 United Kingdom                                          310.30 16.80% $17,458,659,172.47 18 Lebanon                                          300.00 27.60% $16,879,141,965.00 19 Spain                                          281.60 38.60% $15,843,887,924.48 20 Austria                                          280.00 56.20% $15,753,865,834.00 21 Belgium                                          227.50 36.80% $12,800,015,990.13 22 Pakistan                                          184.40 19.20% $10,375,045,927.82 23 Philippines                                          175.90 14.00% $9,896,803,572.15 24 Algeria                                          173.60 4.50% $9,767,396,817.08 25 Libya                                          143.80 5.60% $8,090,735,381.89 26 Singapore                                          127.40 2.50% $7,168,008,954.47 27 Sweden                                          125.70 11.10% $7,072,360,483.34 28 South Africa                                          124.90 12.20% $7,027,349,438.10 29 Turkey                                          116.10 6.00% $6,532,227,940.46 30 Greece                                          111.70 78.70% $6,284,667,191.64 31 Romania                                          103.70 9.10% $5,834,556,739.24 32 Poland                                          102.90 4.50% $5,789,545,694.00 33 Mexico                                          100.10 3.80% $5,632,007,035.66 34 Thailand                                             99.50 2.50% $5,598,248,751.73 35 Australia                                             79.90 8.10% $4,495,478,143.35 36 Kuwait                                             79.00 13.50% $4,444,840,717.45 37 Egypt                                             75.60 8.70% $4,253,543,775.18 38 Indonesia                                             73.10 3.60% $4,112,884,258.81 39 Kazakhstan                                             67.30 10.00% $3,786,554,180.82 40 Denmark                                             66.50 3.30% $3,741,543,135.58 41 Argentina                                             54.70 4.50% $3,077,630,218.29 42 Finland                                             49.10 20.60% $2,762,552,901.61 43 Bulgaria                                             39.90 9.90% $2,244,925,881.35 44 Malaysia                                             36.40 1.50% $2,048,002,558.42 45 Peru                                             34.70 3.60% $1,952,354,087.29 46 Belarus                                             32.00 24.50% $1,800,441,809.60 47 Brazil                                             33.60 0.50% $1,890,463,900.08 48 Slovakia                                             31.80 65.40% $1,789,189,048.29 49 Bolivia                                             28.30 13.40% $1,592,265,725.37 50 Ukraine                                             27.20 3.50% $1,530,375,538.16 51 Ecuador                                             26.30 31.00% $1,479,738,112.27 52 Syria                                             25.80 0.00% $1,451,606,208.99 53 Morocco                                             22.00 4.20% $1,237,803,744.10 54 Nigeria                                             21.40 0.00% $1,204,045,460.17 55 Sri Lanka Sri Lanka                                             17.50 11.90% $984,616,614.63 56 South Korea South Korea                                             14.40 0.20% $810,198,814.32 57 Cyprus                                             13.90 50.80% $782,066,911.05 58 Bangladesh                                             13.50 5.20% $759,561,388.43 59 Serbia                                             13.10 4.20% $737,055,865.81 60 Netherlands Antilles                                             13.10 36.30% $737,055,865.81 61 Jordan                                             12.80 4.30% $720,176,723.84 62 Czech Republic                                             12.70 1.20% $714,550,343.19 63 Cambodia                                             12.40 14.40% $697,671,201.22 64 Laos                                               8.80 36.50% $495,121,497.64 65 Latvia                                               7.70 4.00% $433,231,310.44 66 El Salvador                                               7.30 10.60% $410,725,787.82 67 Guatemala                                               6.90 5.30% $388,220,265.20 68 Colombia                                               6.90 1.10% $388,220,265.20 69 Republic of Macedonia, Former Yugoslav Republic of Macedonia                                               6.80 12.70% $382,593,884.54 70 Tunisia                                               6.80 0.00% $382,593,884.54 71 Ireland                                               6.00 11.80% $337,582,839.30 72 Lithuania                                               5.80 3.80% $326,330,077.99 73 Bahrain                                               4.70 0.00% $264,439,890.79 74 Mauritius                                               3.90 6.80% $219,428,845.55 75 Canada                                               3.40 0.20% $191,296,942.27 76 Tajikistan                                               3.30 0.00% $185,670,561.62 77 Slovenia                                               3.20 13.40% $180,044,180.96 78 Aruba                                               3.10 17.70% $174,417,800.31 79 Hungary                                               3.10 0.30% $174,417,800.31 80 Kyrgyzstan                                               2.60 6.50% $146,285,897.03 81 Luxembourg                                               2.20 11.70% $123,780,374.41 82 Hong Kong                                               2.10 0.00% $118,153,993.76 83 Suriname                                               2.00 11.40% $112,527,613.10 84 Iceland                                               2.00 1.60% $112,527,613.10 85 Papua New Guinea                                               2.00 2.90% $112,527,613.10 86 Trinidad and Tobago                                               1.90 0.80% $106,901,232.45 87 Albania                                               1.60 2.80% $90,022,090.48 88 Yemen                                               1.60 1.10% $90,022,090.48 89 Cameroon                                               0.90 1.20% $50,637,425.90 90 Mongolia                                               0.90 2.40% $50,637,425.90 91 Honduras                                               0.70 0.00% $39,384,664.59 92 Paraguay                                               0.70 0.70% $39,384,664.59 93 Dominican Republic                                               0.60 1.00% $33,758,283.93 94 Gabon                                               0.40 0.80% $22,505,522.62 95 Malawi                                               0.40 6.20% $22,505,522.62 96 Central African Republic                                               0.30 8.40% $16,879,141.97 97 Chad                                               0.30 2.40% $16,879,141.97 98 Republic of the Congo                                               0.30 0.40% $16,879,141.97 99 Uruguay                                               0.30 0.10% $16,879,141.97 100 Fiji                                               0.20 0.00% $11,252,761.31   SOURCES: http://www.gold.org/investment/statistics/reserve_asset_statistics and http://af.reuters.com/article/southAfricaNews/idAFLDE7551YW20110606. ================ ADDITIONAL SOURCES: http://money.howstuffworks.com/question213.htm [neat article on the world’s gold, titled “All the Gold in the World,” provides some background for this infographic] http://www.forbes.com/sites/afontevecchia/2010/11/19/how-many-olympic-sized-swimming-pools-can-we-fill-with-billionaire-gold [describes how world’s gold fills 3.27 Olympic-sized swimming pools with gold, at 157,000 metric tons of above-ground gold in 2007 – these numbers have since increased, as reflected above]

Dangerous Debt

Dangerous Debt

Posted by John Stossel | January 05, 2012

I've written before about our exploding national debt. But all the trillions and billions can be hard to comprehend. It's why this image from a chain e-mail has gone viral:... continue reading »

National Debt as Household Budget

It is almost all accurate, except it gives Congress too much credit. Yes, politicians said they cut $38 billion last year. But the latest budget tables from the White House's Office of Management and Budget reveal that The federal government actually spent $362 billion more in 2011 than in 2010. (And it's not just because of the growth of Medicare and Social Security. Even what bureaucrats call "non-defense discretionary spending" increased by $5 billion.)

Also, the e-mail is outdated: the debt is now up to $15,190,000,000,0000. It's like a family that has $151,900 in debt.

We need to slash government spending. Here's what I would cut.

Read more: http://www.foxbusiness.com/on-air/stossel/blog/2012/01/05/dangerous-debt#ixzz1j5CMdtIr

http://www.foxbusiness.com/on-air/stossel/blog/2012/01/05/dangerous-debt

The Iron Lady on "The Gap" Between Rich and Poor

http://ideasmatter.typepad.com/ideas-matter/2012/01/the-iron-lady-on-the-gap.html

The Iron Lady on "The Gap" Between Rich and Poor

Margaret Thatcher is right: They would rather the poor were poorer, provided the rich were less rich. This is the essence of the progressive worldview. And it's time we purged our society of class warfare politics. What matters, after all, is not how much the rich have, but that conditions of the poorest are steadily improving. 

That doesn't mean we should tolerate government transfers from poor and middle class to the wealthy. And these are going on all the time -- from regressive local sales taxes to bank bailouts/corporate welfare to Medicare. But if we take the marketplace and disentangle the government, we should be prepared to say that there is a causal relationship between the rich getting richer and the poor being better off. In the positive-sum game of economic growth -- "a rising tide lifts all boats."

The Glory of the Market vs. the Compulsory Monopoly of Bureaucratic Government

From Carpe Diem By Professor Mark J. Perry
http://mjperry.blogspot.com/2012/01/quote-of-day-essence-and-glory-of.html

Quote of the Day: The Glory of the Market vs. the Compulsory Monopoly of Bureaucratic Government

"The essence and the glory of the free market is that individual firms and businesses, competing on the market, provide an ever-changing orchestration of efficient and progressive goods and services: continually improving products and markets, advancing technology, cutting costs, and meeting changing consumer demands as swiftly and as efficiently as possible.

The libertarian economist can try to offer a few guidelines on how markets might develop where they are now prevented or re­stricted from developing; but he can do little more than point the way toward freedom, to call for government to get out of the way of the productive and ever-inventive energies of the public as expressed in voluntary market activity. No one can predict the number of firms, the size of each firm, the pricing policies, etc., of any future market in any service or commodity. We just know—by economic theory and by historical insight—that such a free market will do the job infinitely better than the compulsory monopoly of bureaucratic government."

~Murray Rothbard in "For a New Liberty"

HT: Dennis Gartman in today's The Gartman Letter

Carpe Diem

The Disbanding of Troops - by Frederick Bastiat

II. The Disbanding of Troops.

It is the same with a people as it is with a man. If it wishes to give itself some gratification, it naturally considers whether it is worth what it costs. To a nation, security is the greatest of advantages. If, in order to obtain it, it is necessary to have an -army of a hundred thousand men, I have nothing to say against it. It is an enjoyment bought by a sacrifice. Let me not be misunderstood upon the extent of my position. A member of the assembly proposes to disband a hundred thousand men, for the sake of relieving the tax-payers of a hundred millions. If we confine ourselves to this answer -“The hundred millions of men, and these hundred millions of money, are indispensable to the national security: it is a sacrifice; but without this sacrifice, France would be torn by factions, or invaded by some foreign power,” -I have nothing to object to this argument, which may be true or false in fact, but which theoretically contains nothing which militates against economy. The error begins when the sacrifice itself is said to be an advantage because it profits somebody.
Now I am very much mistaken if, the moment the author of the proposal has taken his seat, some orator will not rise and say -“Disband a hundred thousand men! do you know what you are saying? What will become of them? Where will they get a living? Don't you know that work is scarce everywhere? That every field is overstocked? Would you turn them out of doors to increase competition, and weigh upon the rate of wages? Just now, when it is a hard matter to live at all, it would be a pretty thing if the State must find bread for a hundred thousand individuals? Consider, besides, that the army consumes wine, clothing, arms -that it promotes the activity of manufactures in garrison townsthat it is, in short, the god-send of innumerable purveyors. Why, any one must tremble at the bare idea of doing away with this immense industrial movement.”
This discourse, it is evident, concludes by voting the maintenance of a hundred thousand soldiers, for reasons drawn from the necessity of the service, and from economical considerations. It is these considerations only that I have to refute.
A hundred thousand men, costing the tax-payers a hundred millions of money, live and bring to the purveyors as much as a hundred millions can supply. This is that which is seen.
But, a hundred millions taken from the pockets of the tax-payers, cease to maintain these taxpayers and the purveyors, as far as a hundred minions reach. This is that which is not seen. Now make your calculations. Cast up, and tell me what profit there is for the masses?
I will tell you where the loss lies; and to simplify it, instead of speaking of a hundred thousand men and a million of money, it shall be of one man, and a thousand francs.
We will suppose that we are in the village of A. The recruiting sergeants go their round, and take off a man. The tax-gatherers go their round, and take off a thousand francs. The man and the sum of money are taken to Metz, and the latter is destined to support the former for a year without doing anything. If you consider Metz only, you are quite right; the measure is a very advantageous one: but if you look towards the village of A., you will judge very differently; for, unless you are very blind indeed, you will see that that village has lost a worker, and the thousand francs which would remunerate his labour, as well as the activity which, by the expenditure of those thousand francs, it would spread around it.
At first sight, there would seem to be some compensation. What took place at the village, now takes place at Metz, that is all. But the loss is to be estimated in this way: -At the village, a man dug and worked; he was a worker. At Metz, he turns to the right about, and to the left about; he is a soldier. The money and the circulation are the same in both cases; but in the one there were three hundred days of productive labour; in the other, there are three hundred days of unproductive labour, supposing, of course, that a part of the army is not indispensable to the public safety.
Now, suppose the disbanding to take place. You tell me there will be a surplus of a hundred thousand workers, that competition will be stimulated, and it will reduce the rate of wages. This is what you see.
But what you do not see is this. You do not see that to dismiss a hundred thousand soldiers is not to do away with a million of money, but to return it to the tax-payers. You do not see that to throw a hundred thousand workers on the market, is to throw into it, at the same moment, the hundred millions of money needed to pay for their labour; that, consequently, the same act which increases the supply of hands, increases also the demand; from which it follows, that your fear of a reduction of wages is unfounded. You do not see that, before the disbanding as well as after it, there are in the country a hundred millions of money corresponding with the hundred thousand men. That the whole difference consists in this: before the disbanding, the country gave the hundred millions to the hundred thousand men for doing nothing; and that after it, it pays them the same sum for working. You do not see, in short, that when a tax-payer gives his money either to a soldier in exchange for nothing, or to a worker in exchange for something, all the ultimate consequences of the circulation of this money are the same in the two cases; only, in the second case, the tax-payer receives something, in the former he receives nothing. The result is -a dead loss to the nation.
The sophism which I am here combating will not stand the test of progression, which is the touchstone of principles. If, when every compensation is made, and all interests are-satisfied, there is a national profit in increasing the army, why not enroll under its banners the entire male population of the country?

The Broken Window - by Frederick Bastiat

I. -The Broken Window

Have you ever witnessed the anger of the good shopkeeper, James B., when his careless son happened to break a square of glass? If you have been present at such a scene, you will most assuredly bear witness to the fact, that every one of the spectators, were there even thirty of them, by common consent apparently, offered the unfortunate owner this invariable consolation -“It is an ill wind that blows nobody good. Everybody must live, and what would become of the glaziers if panes of glass were never broken?” Now, this form of condolence contains an entire theory, which it will be well to show up in this simple case, seeing that it is precisely the same as that which, unhappily, regulates the greater part of our economical institutions.
Suppose it cost six francs to repair the damage, and you say that the accident brings six francs to the glazier's trade -that it encourages that trade to the amount of six francs -I grant it; I have not a word to say against it; you reason justly. The -lazier comes, performs his task, receives his six francs, rubs Ms hands, and, in his heart, blesses the careless child. All this is that which is seen.
But if, on the other hand, you come to the conclusion, as is too often the case, that it is a good thing to break windows, that it causes money to circulate, and that the encouragement of industry in general will be the result of it, you will oblige me to call out, “Stop there! your theory is confined to that which is seen; it takes no account of that which is not seen.”
It is not seen that as our shopkeeper has spent six francs upon one thing, he cannot spend them upon another. It is not seen that if he had not had a window to replace, he would, perhaps, have replaced his old shoes, or added another book to his library. In short, he would have employed his six francs in some way, which this accident has prevented.
Let us take a view of industry in general, as affected by this circumstance. The window being broken, the glazier's trade is encouraged to the amount of six francs; this is that which is seen. If the window had not been broken, the shoemaker's trade (or some other) would have been encouraged to the amount of six francs; this is that which is not seen.
And if that which is -not seen is taken into consideration, because it is a negative fact, as well as that which is seen, because it is a positive fact, it will be understood that neither industry in general, nor the sum total of national labour, is affected, whether windows are broken or not.
Now let us consider James B. himself. In the former supposition, that of the window being broken, he spends six francs, and has neither more nor less than he had before, the enjoyment of a window.
In the second, where we suppose the window not to have been broken, he would have spent six francs on shoes, and would have had at the same time the enjoyment of a pair of shoes and of a window.
Now, as James B. forms a part of society, we must come to the conclusion, that, taking it altogether, and making an estimate of its enjoyments and its labours, it has lost the value of the broken window.
When we arrive at this unexpected conclusion: “Society loses the value of things which are uselessly destroyed;” and we must assent to a maxim which will make the hair of protectionists stand on end -To break, to spoil, to waste, is not to encourage national labour; nor, more briefly, “destruction is not profit.”
What will you say, Monsieur Industriel —what will you say, disciples of good M. F. Chamans, who has calculated with so much precision how much trade would gain by the burning of Paris, from the number of houses it would be necessary to rebuild?
I am sorry to disturb these ingenious calculations, as far as their spirit has been introduced into our legislation; but I beg him to begin them again, by taking into the account that which is not seen, and placing it alongside of that which is seen. The reader must take care to remember that there are not two persons only, but three concerned in the little scene which I have submitted to his attention. One of them, James B., represents the consumer, reduced, by an act of destruction, to one enjoyment instead of two. Another under the title of the glazier, shows us the producer, whose trade is encouraged by the accident. The third is the shoemaker (or some other tradesman), whose labour suffers proportionably by the same cause. It is this third person who is always kept in the shade, and who, personating that which is not seen, is a necessary element of the problem. It is he who shows us how absurd it is to think we see a profit in an act of destruction. It is he who will soon teach us that it is not less absurd to see a profit in a restriction, which is, after all, nothing else than a partial destruction. Therefore, if you will only go to the root of all the arguments which are adduced in its favour, all you will find will be the paraphrase of this vulgar saying -What would become of the glaziers, if nobody ever broke windows?

That Which is Seen, and that Which is Not Seen

by Frederick Bastiat

That Which is Seen, and that Which is Not Seen

In the department of economy, an act, a habit, an institution, a law, gives birth not only to an effect, but to a series of effects. Of these effects, the first only is immediate; it manifests itself simultaneously with its cause -it is seen. The others unfold in succession -they are not seen: it is well for us, if they are foreseen. Between a good and a bad economist this constitutes the whole difference -the one takes account of the visible effect; the other takes account both of the effects which are seen, and also of those which it is necessary to foresee. Now this difference is enormous, for it almost always happens that when the immediate consequence is favourable, the ultimate consequences are fatal, and the converse. Hence it follows that the bad economist pursues a small present good, which will be followed by a great evil to come, while the true economist pursues a great good to come, -at the risk of a small present evil. In fact, it is the same in the science of health, arts, and in that of morals. It often happens, that the sweeter the first fruit of a habit is, the more bitter are the consequences. Take, for example, debauchery, idleness, prodigality. When, therefore, a man absorbed in the effect which is seen has not yet learned to discern those which are not seen, he gives way to fatal habits, not only by inclination, but by calculation.
This explains the fatally grievous condition of mankind. Ignorance surrounds its cradle: then its actions are determined by their first consequences, the only ones which, in its first stage, it can see. It is only in the long run that it learns to take account of the others. It has to learn this lesson from two very different masters-experience and foresight. Experience teaches effectually, but brutally. It makes us acquainted with all the effects of an action, by causing us to feel them; and we cannot fail to finish by knowing that fire burns, if we have burned ourselves. For this rough teacher, I should like, if possible, to substitute a more gentle one. I mean Foresight. For this purpose I shall examine the consequences of certain economical phenomena, by placing in opposition to each other those which are seen, and those which are not seen. 

Some Questions About Government - Arnold Kling

Some Questions About Government

Arnold Kling

Are government monopolies efficient? In theory, in the business world monopoly is efficient, because it eliminates duplicate overhead. (Monopoly is inefficient in theory because the monopolist charges a price that is too high, but we might suppose that government will not do that.) In practice, however, monopoly is inefficient because without the pressure of competition, business practices tend to stagnate. Is government immune from this stagnation problem, and if so, how?


http://econlog.econlib.org/archives/2012/01/some_questions.html#

The Law

And what liberties should the legislature permit us to keep? Liberty of association? (No, people would be intolerant toward each other). Liberty of conscience? (No, people would become atheists). Liberty of education? (No, parents would teach their children immoralities and falsehoods). Liberty of labor? (No, that would mean competitive markets, which mean oppression and chaos). Liberty of trade? (No, then we would buy from other nations thereby ruining our own economy). Clearly, the socialists cannot permit persons any liberty because they believe that mankind naturally tends toward degradation and disaster. Surely, without drive and guidance from government, we will cease to associate with each other, to help each other, to protect each other, our children, and ourselves, to love and honor our unfortunate brothers, and to strive to improve ourselves to the best of our abilities. Thus, the legislature must make plans to save us from ourselves.

On the Origins of Money - Carl Menger

On the Origins of Money - Carl Menger

The man who goes to market with his wares intends as a rule to dispose of them, by no means at any price whatever, but at such as corresponds to the general economic situation. if we are going to inquire into the different degrees of saleableness in goods so as to show its bearing upon practical life, we can only do so by consulting the greater or less facility with which they may be disposed of at prices corresponding to the general economic situation, that is, at economic prices.(3*) A commodity is more or less saleable according as we are able, with more or less prospect of success, to dispose of it at prices corresponding to the general economic situation, at economic prices.
The interval of time, moreover, within which the disposal of a commodity at the economic price may be reckoned on, is of great significance in an inquiry into its degree of saleableness. It matters not whether the demand for a commodity be slight, or whether on other grounds its saleableness be small; if its owner can only bide his time, he will finally and in the long run be able to dispose of it at economic prices. Since, however, this condition is often absent in the actual course of business, there arises for practical purposes an important difference between those commodities, on the one hand, which we expect to dispose of at any given time at economic, or at least approximately economic, prices, and such goods, on the other hand, respecting which we have no such prospect, or at least not in the same degree, and to dispose of which at economic prices the owner foresees it will be necessary to wait for a longer or shorter period, or else to put up with a more or less sensible abatement in the price.
Again, account must be taken of the quantitative factor in the saleableness of commodities. Some commodities, in consequence of the development of markets and speculation, are able at any time to find a sale in practically any quantity at economic, approximately economic, prices. Other commodities can only find a sale at economic prices in smaller quantities, commensurate with the gradual growth of an effective demand, fetching a relatively reduced price in the case of a greater supply.

Carl Menger - On the Origin of Money

 VI. On the Genesis of Media of Exchange. 

It has long been the subject of universal remark in centres of exchange, that for certain commodities there existed a greater, more constant, and more effective demand than for other commodities less desirable in certain respects, the former being such as correspond to a want on the part of those able and willing to traffic, which is at once universal and, by reason of the relative scarcity of the goods in question, always imperfectly satisfied. And further, that the person who wishes to acquire certain definite goods in exchange for his own is in a more favourable position, if he brings commodities of this kind to market, than if he visits the markets with goods which cannot display such advantages, or at least not in the same degree. Thus equipped he has the prospect of acquiring such goods as he finally wishes to obtain, not only with greater ease and security, but also, by reason of the steadier and more prevailing demand for his own commodities, at prices corresponding to the general economic situation -- at economic prices. Under these circumstances, when any one has brought goods not highly saleable to market, the idea uppermost in his mind is to exchange them, not only for such as he happens to be in need of, but, if this cannot be effected directly, for other goods also, which, while he did not want them himself, were nevertheless more saleable than his own. By so doing he certainly does not attain at once the final object of his trafficking, to wit, the acquisition of goods needful to himself. Yet he draws nearer to that object. By the devious way of a mediate exchange, he gains the prospect of accomplishing his purpose more surely and economically than if he had confined himself to direct exchange. Now in point of fact this seems everywhere to have been the case. Men have been led, with increasing knowledge of their individual interests, each by his own economic interests, without convention, without legal compulsion, nay, even without any regard to the common interest, to exchange goods destined for exchange (their "wares") for other goods equally destined for exchange, but more saleable.
With the extension of traffic in space and with the expansion over ever longer intervals of time of prevision for satisfying material needs, each individual would learn, from his own economic interests, to take good heed that he bartered his less saleable goods for those special commodities which displayed, beside the attraction of being highly saleable in the particular locality, a wide range of saleableness both in time and place. These wares would be qualified by their costliness, easy transportability, and fitness for preservation (in connection with the circumstance of their corresponding to a steady and widely distributed demand), to ensure to the possessor a power, not only 'here' and 'now' but as nearly as possible unlimited in space and time generally, over all other market-goods at economic prices.
And so it has come to pass, that as man became increasingly conversant with these economic advantages, mainly by an insight become traditional, and by the habit of economic action, those commodities, which relatively to both space and time are most saleable, have in every market become the wares, which it is not only in the interest of every one to accept in exchange for his own less saleable goods, but which also are those he actually does readily accept. And their superior saleableness depends only upon the relatively inferior saleableness of every other kind of commodity, by which alone they have been able to become generally acceptable media of exchange.
It is obvious how highly significant a factor is habit in the genesis of such generally serviceable means of exchange. It lies in the economic interest of each trafficking individual to exchange less saleable for more saleable commodities. But the willing acceptance of the medium of exchange presupposes already a knowledge of these interest on the part of those economic subjects who are expected to accept in exchange for their wares a commodity which in and by itself is perhaps entirely useless to them. It is certain that this knowledge never arises in every part of a nation at the same time. It is only in the first instance a limited number of economic subjects who will recognize the advantage in such procedure, an advantage which, in and by itself, is independent of the general recognition of a commodity as a medium of exchange, inasmuch as such an exchange, always and under all circumstances, brings the economic unit a good deal nearer to his goal, to the acquisition of useful things of which he really stands in need. But it is admitted, that there is no better method of enlightening any one about his economic interests than that he perceive the economic success of those who use the right means to secure their own. Hence it is also clear that nothing may have been so favourable to the genesis of a medium of exchange as the acceptance, on the part of the most discerning and capable economic subjects, for their own economic gain, and over a considerable period of time, of eminently saleable goods in preference to all others. In this way practice and a habit have certainly contributed not a little to cause goods, which were most saleable at any time, to be accepted not only by many, but finally by all, economic subjects in exchange for their less saleable goods; and not only so, but to be accepted from the first with the intention of exchanging them away again. Goods which had thus become generally acceptable media of exchange were called by the Germans Geld, from gelten, i.e. to pay, to perform, while other nations derived their designation for money mainly from the substance used, the shape of the coin,  or even from certain kinds of coin.  It is not impossible for media of exchange, serving as they do the commonweal in the most emphatic sense of the word, to be instituted also by way of legislation, like other social institutions. But this is neither the only, nor the primary mode in which money has taken its origin. This is much more to be traced in the process depicted above, notwithstanding the nature of that process would be but very incompletely explained if we were to call it 'organic' or denote money as something 'primordial', or 'primaeval growth', and so forth. Putting aside assumptions which are historically unsound, we can only come fully to understand the origin of money by learning to view the establishment of the social procedure, with which we are dealing, as the spontaneous outcome, the unpremeditated resultant, of particular, individual efforts of the members of a society, who have little by little worked their way to a discrimination of the different degrees of saleableness in commodities.

On the Origins of Money- Carl Menger

 V. Concerning the Causes of the Different Degrees of Saleableness in Commodities.

The degree to which a commodity is found by experience to command a sale, at a given market, at any time, at prices corresponding to the economic situation (economic prices), depends upon the following circumstances.
1. Upon the number of persons who are still in want of the commodity in question, and upon the extent and intensity of that want, which is unsupplied, or is constantly recurring.
2. Upon the purchasing power of those persons.
3. Upon the available quantity of the commodity in relation to the yet unsupplied (total) want of it.
4. Upon the divisibility of the commodity, and any other ways in which it may be adjusted to the needs of individual customers.
5. Upon the development of the market, and of speculation in particular. And finally.
6. Upon the number and nature of the limitations imposed politically and socially upon exchange and consumption with respect to the commodity in question.
We may proceed, in the same way in which we considered the degree of the saleableness in commodities at definite markets and definite points of time,to set out the spatial and temporal limits of their saleableness. In these respects also we observe in our markets some commodities, the saleableness of which is almost unlimited by place or time, and others the sale of which is more or less limited.
The spatial limits of the saleableness of commodities are mainly conditioned --
1. By the degree to which the want of the commodities is disturbed in space.
2. By the degree to which the goods lend themselves to transport,and the cost of transport incurred in proportion to their value.
3. By the extent to which the means of transport and of commerce generally are developed with respect to different classes of commodities.
4. By the local extension of organised markets and their inter-communication by 'arbitrage'.
5. By the differences in the restrictions imposed upon commercial inter-communication with respect to different goods, to interlocal and, in particular, in international trade.
The time limits to the saleableness of commodities are mainly conditioned --
1. By permanence in the need of them (their independence of fluctuation in the same).
2. Their durability, i.e. their suitableness for preservation.
3. The cost of preserving and storing them.
4. The rate of interest.
5. The periodicity of a market for the same.
6. The development of speculation and in particular of time-bargains in connection with the same.
7. The restrictions imposed politically and socially on their being transferred from one period of time to another.
All these circumstances, on which depend the different degrees of, and the different local and temporal limits to, the saleableness of commodities, explain why it is that certain commodities can be disposed of with ease and certainty in definite markets, i.e. within local and temporal limits, at any time and in practically any quantities, at prices corresponding to the general economic situation, while the saleableness of other commodities is confined within narrow spatial, and again, temporal, limits: and even within these the disposal of the commodities in question is difficult, and, in so far as the demand cannot be waited for, is not to be brought about without a more or less sensible diminution in price.

THE THEORY OF VALUE - Carl Menger

Utility is the capacity of a thing to serve for the satisfaction of human needs, and hence (provided the utility is recognized) it is a general prerequisite of goods-character. Non-economic goods have utility as well as economic goods, since they are just as capable of satisfying our needs. With these goods also, their capacity to satisfy needs must be recognized by men, since they could not otherwise acquire goods-character. But what distinguishes a non-economic good from a good subject to the quantitative relationship responsible for economic character is the circumstance that the satisfaction of human needs does not depend upon the availability of concrete quantities of the former but does depend upon the availability of concrete quantities of the latter. For this reason the former possesses utility, but only the latter, in addition to utility, possesses also that significance for us that we call value.
     Of course the error underlying the confusion of utility and use value has had no influence on the practical activity of men. At no time has an economizing individual attributed value under ordinary circumstances to a cubic foot of air or, in regions abounding in springs, to a pint of water. The practical man distinguishes very well the capacity of an object to satisfy one of his needs from its value. But this confusion has become an enormous obstacle to the development of the more general theories of our science.