When all gold that glitters isn’t golden

The wife says, buy some gold. The husband dismisses the suggestion: we will invest our savings in productive assets, not inert metal. She is no uneducated hausfrau, but she is also not a trained economist, whereas he is. You put money in a bank account, the bank will lend it to someone, who will use it to generate fresh income. Your saving leads to new income and new jobs in the economy. You buy shares in companies, directly, or through a mutual fund. You own a chunk of the economy’s capacity to produce, and share in the returns. Is this what you want or do you want to continue to worship a relic from the past, a metal whose only proper use is to serve as a near-perfect conductor in your high-fidelity audio equipment but is mistakenly used as a store of value? She buys a little bit of gold, anyway. He buys shares.

The markets tank. The rupee tanks. The value of the shares tanks. The prize of the gold zooms. His savings have shrunk. Her gold shines all the brighter. Her middle name is not Cruella. She merely says, with the barest hint of I-told-you-so, let’s buy some gold now. In the long run, he begins defensively. We’re all dead, she says triumphantly, because she is quoting an economist to counter another economic objection.

They walk to the jewellers, he, weighed down by rationality’s doom, and she, with a spring in her step.