Money needs to be stable. In order to be stable, it needs to meet these 7 characteristics.
(1) It must be durable, which is why we don’t use wheat or corn, or rice.
(2) It must be divisible, which is why we don’t use artwork.
(3) It must be convenient, which is why we don’t use lead or copper.
(4) It must be consistent, which is why we don’t use real estate.
(5) It must possess value in itself, which is why we don’t use paper.
(6) It must be limited in the quantity that is available, which is why we don’t use aluminum or iron.
(7) It should have a long history of acceptance, which is why we don’t use molybdenum or rhodium.
Only GOLD and SILVER fit all seven characteristics.
EVERYTHING else is inferior which makes them credit. They are essentially Gold substitutes.
If you had a race to see who was the fastest man in the world there can only be one winner and ONLY ONE person can hold the label of the fastest man in the world. It doesn't mean that the rest are slow, it just means that they are not the fastest.
Value is ultimately determined by the person holding the money. "He who has the Gold makes the rules."
Copper requires smelting and is vulnerable to corrosion. One of the larger reasons gold was so useful is that it could be stored and used for a long time, without rusting. It was also pretty easy to work which made it perfect for complex shaping for decorative items.
(5) It must possess value in itself, which is why we don’t use paper.
that's where gold is propped up by everyone else, just like the dollar. it doesn't feed people, it doesn't house people, it doesn't power mechanisms. it's only value is the fact that it has value, and everyone else assigns it value.
it doesn't feed people, it doesn't house people, it doesn't power mechanisms
That's not the purpose of money. He just listed the seven necessary attributes of money and these were not included for good reason. Money needs to just sit there and do nothing until it can be exchanged for food, housing or powering mechanisms at a suitable time. That's the whole point and nothing sits there and holds value like gold. You can throw it in the ocean for 500 years and it'll come out looking pristine and even more valuable.
it's only value is the fact that it has value, and everyone else assigns it value
Everything has value because people assign it value. Food and housing only have value because people need them to survive, if they didn't they'd be worthless. They serve a purpose which makes them valuable, just like gold.
Feel free to barter if the concept of money goes over your head but it's very difficult and cumbersome which is why money was invented in the first place.
no money is backed by value anymore.
even when it was backed by gold, gold was only valuable because people said so. it wasn't like food or fuel.
Gold is money. Everything else is credit.
Money needs to be stable. In order to be stable, it needs to meet these 7 characteristics.
(1) It must be durable, which is why we don’t use wheat or corn, or rice.
(2) It must be divisible, which is why we don’t use artwork.
(3) It must be convenient, which is why we don’t use lead or copper.
(4) It must be consistent, which is why we don’t use real estate.
(5) It must possess value in itself, which is why we don’t use paper.
(6) It must be limited in the quantity that is available, which is why we don’t use aluminum or iron.
(7) It should have a long history of acceptance, which is why we don’t use molybdenum or rhodium.
Only GOLD and SILVER fit all seven characteristics.
EVERYTHING else is inferior which makes them credit. They are essentially Gold substitutes.
If you had a race to see who was the fastest man in the world there can only be one winner and ONLY ONE person can hold the label of the fastest man in the world. It doesn't mean that the rest are slow, it just means that they are not the fastest.
Value is ultimately determined by the person holding the money. "He who has the Gold makes the rules."
I don't understand how copper lacks "convenience".
Copper requires smelting and is vulnerable to corrosion. One of the larger reasons gold was so useful is that it could be stored and used for a long time, without rusting. It was also pretty easy to work which made it perfect for complex shaping for decorative items.
Don't forget the amount of copper you would have to carry around for simple purchases would be astronomical
that's where gold is propped up by everyone else, just like the dollar. it doesn't feed people, it doesn't house people, it doesn't power mechanisms. it's only value is the fact that it has value, and everyone else assigns it value.
Then give me all your gold.
Even the gold-plated stuff.
No value, right?
jokes on you, I don't have any.
even if I did, I would keep it just like I keep my dollars. both are assigned value, which means both can be traded for something.
all I'm saying is that could change easily
Wait isn't gold used in electronical parts like computer motherboards?
It is but that's not why it's valuable. Gold is almost purely a monetary metal unlike silver for example.
That's not the purpose of money. He just listed the seven necessary attributes of money and these were not included for good reason. Money needs to just sit there and do nothing until it can be exchanged for food, housing or powering mechanisms at a suitable time. That's the whole point and nothing sits there and holds value like gold. You can throw it in the ocean for 500 years and it'll come out looking pristine and even more valuable.
Everything has value because people assign it value. Food and housing only have value because people need them to survive, if they didn't they'd be worthless. They serve a purpose which makes them valuable, just like gold.
Feel free to barter if the concept of money goes over your head but it's very difficult and cumbersome which is why money was invented in the first place.
but this is a very recent financial experiment- only since 1971 has the US dollar been backed by nothing.
massive inflation since 1971 kind of proves it failed.
More and more people avoid saving in dollars to avoid inflation.
Wasn't the first national currency backed by nothing and then rapidly switched over because it was worth nothing?
I seem to remember something vaguely to that effect regarding financing for the revolutionary war
If people have a choice - they will always save in the hardest most stable currency.
So CBDC and fiat rely on removing alternatives