Comments on: when & why was the use of the gold replaced by a designated currency as a measure of a countries wealth? http://www.myylt.com/2009/03/01/when-why-was-the-use-of-the-gold-replaced-by-a-designated-currency-as-a-measure-of-a-countries-wealth/ Discussion of Forex Trading and Currency Trading Tue, 22 May 2012 23:58:48 +0000 http://wordpress.org/?v=2.3.3 By: Borodin http://www.myylt.com/2009/03/01/when-why-was-the-use-of-the-gold-replaced-by-a-designated-currency-as-a-measure-of-a-countries-wealth/#comment-11862 Borodin Tue, 30 Nov 1999 00:00:00 +0000 http://www.myylt.com/2009/03/01/when-why-was-the-use-of-the-gold-replaced-by-a-designated-currency-as-a-measure-of-a-countries-wealth/#comment-11862 The secret answer is that it hasn't. The Federal Reserve Bank in New York, keeps stacks of gold moving around that represent the wealth of nations, and moves them around. It's kept there "as a service to the other countries". The answer why that people will give is that gold has no intrinsic, value. This is also true; gold has no intrinsic value (although it's nice in that if the SHTF you can use a touchstone and estimate its purity without, say, a mass spectrometer). In fact, it's a nearly useless metal. Chemists struggle to find uses for gold (as compared to platinum, palladium, niobium, iridium, rhodium, etc which have tons of uses). So if monetary value is kind of arbitrary, why not just call a spade a spade and let currencies float? Some people will say that there's not enough gold to cover the amount of currency; but that's not true because the price of gold *could* rise so that the amount in reserves could cover the amount of circulating and digital currency. The answer that some people will give is that the power to inflate the currency gives government the power over people's pocketbooks, which is a very powerful power indeed. The secret answer is that it hasn't. The Federal Reserve Bank in New York, keeps stacks of gold moving around that represent the wealth of nations, and moves them around. It's kept there "as a service to the other countries".

The answer why that people will give is that gold has no intrinsic, value. This is also true; gold has no intrinsic value (although it's nice in that if the SHTF you can use a touchstone and estimate its purity without, say, a mass spectrometer). In fact, it's a nearly useless metal. Chemists struggle to find uses for gold (as compared to platinum, palladium, niobium, iridium, rhodium, etc which have tons of uses). So if monetary value is kind of arbitrary, why not just call a spade a spade and let currencies float?

Some people will say that there's not enough gold to cover the amount of currency; but that's not true because the price of gold *could* rise so that the amount in reserves could cover the amount of circulating and digital currency.

The answer that some people will give is that the power to inflate the currency gives government the power over people's pocketbooks, which is a very powerful power indeed.

]]> By: Mr. Peachy® http://www.myylt.com/2009/03/01/when-why-was-the-use-of-the-gold-replaced-by-a-designated-currency-as-a-measure-of-a-countries-wealth/#comment-11863 Mr. Peachy® Tue, 30 Nov 1999 00:00:00 +0000 http://www.myylt.com/2009/03/01/when-why-was-the-use-of-the-gold-replaced-by-a-designated-currency-as-a-measure-of-a-countries-wealth/#comment-11863 Simply because there isn't nearly enough gold on the planet to cover how much currency there is. It happened long ago. Simply because there isn't nearly enough gold on the planet to cover how much currency there is. It happened long ago.

]]>