Tesla Inc CEO Elon Musk recently commented on an old video in which he discusses money and its worth. Economist and gold bull Peter Schiff chimed in as well.

People get confused sometimes and think the economy is money, Musk says in the video shared by one of his Twitter followers going by the handle @cb_doge.

“Monday is a database for the exchange of business services and for timeshifting exchange of business services,” Musk is seen saying, adding that “money is not power in itself.”

Musk also explained his point with an example. If someone is shipwrecked on an island and he has got a trillion dollars in his Swiss bank account, it is worthless, the billionaire said.

The actual economy, according to the entrepreneur, is goods and services.

Commenting on the video, Musk said Tuesday said when you are stranded on an island if the choice is between a pallet of food or billion dollars “the latter has no value because there are no resources to allocate.”

Agreeing with Musk, Schiff said government can print money but it can’t print resources.

“Paper money only has value if those who have the resources are willing to trade them for government fiat,” the economist said.

“Gold is also a resource that always has value. That’s why it’s real money.”

The yellow metal has gained 7.5% this year, underperforming the broader market. The S&P 500 has gained about 17.5% in the same period. 

Gold is considered a safe haven and it has a negative correlation to the dollar, as it is denominated in dollars. Its value is not impacted by interest rates and the governments cannot tamper with its supply, unlike paper money which can be printed.

© 2023 Zenger News.com. Zenger News does not provide investment advice. All rights reserved.

Produced in association with Benzinga

Edited by Arnab Nandy