Letters to the editor | The Economist

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The nature of gold

Buttonwood’s column on bitcoin and the battle between “crypto kids and fiat dinosaurs” (May 29th) made many excellent points, although a couple of them could be qualified. The column stated that “crypto, like gold, is built on a collective belief about its value. But so to an extent are all asset prices.” Although we agree with much of this, the argument assumes that gold is solely a financial instrument. It is not. It has a dual nature as a consumer good and an investment. This sets it apart as an asset and is one of the ways gold differs from crypto.

The price of gold is not just driven by how investors view it. It also responds to its uses in jewellery, technology and in myriad other real-world applications. Together, jewellery and technology account for more than 40% of net annual gold demand.

Although there are perhaps a few similarities between crypto and gold, there are more clear differences, and there are many reasons why the value of gold is not solely determined by investors’ beliefs.

DAVID TAIT
Chief executive
World Gold Council
London

The suggestion that the price of bitcoin is the latest measure of investor risk appetite reminded me of your article years ago describing my work (“Time to whet investors’ appetites”, February 24th 1996). The more an asset lacks intrinsic value, the more it is a barometer of shifting risk appetite. We shifted from private to fiat money because the price of money cannot swing wildly. Any seller of products in bitcoin, made with products purchased in bitcoin, would go from bust to boom daily. Modern money is a social construct. Unregulated private money can never be more than a curiosity.

AVINASH PERSAUD
Emeritus professor
Gresham College
London

Get on the bus

Your special report on race in America (May 22nd) didn’t say much about inequities in transport. I have been a bus driver for 13 years in south-east Michigan. We have many good jobs in my suburb of Livonia, but it has chosen not to participate in the regional bus system, cutting off people of all races in Detroit from the opportunities here.

An extremely low-cost way to support people economically is to reorganise transit systems that serve lower-income areas. This enables easier access to jobs and education in the suburbs. One of my regular passengers works in a suburban nursing home but lives in Detroit. Her home and place of work are seven miles apart. She has to take a Detroit bus to Eight Mile Road (the city’s limit) then wait to transfer to a suburban bus, both ways. This should be a 25-minute bus ride. But because she has to transfer her trip takes an hour, if the buses are on time. She cannot work overtime because the last suburban bus leaves at 6:30pm. She doesn’t bother with Sunday work because the buses are unreliable at weekends. Going to community college is out of the question because there are no late evening buses. I know of many people who routinely make three-hour commutes, each way, because they have to catch two transfers, and still walk a mile or more.

Safe and efficient public transport will boost the economic lives of everybody, but especially African-Americans who have been locked out of the larger economy for all these generations.

FRANK KALINSKI
Livonia, Michigan

Is the AC working?

Fresh thinking about fresh air” (May 29th) struck a chord with me. As a ventilation engineer I am constantly appalled at the low priority put on air quality in buildings by regulators. The current code minimum in British Columbia is an American standard published in 2001. It describes how to ventilate “smoking rooms” (smoking in workplaces was outlawed over a decade ago). Building officials are keen to ensure the water pipe serving a toilet is the correct size, but are completely uninterested in the…



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