A few of the problems with gold…
• The value of gold is based entirely on psychology and psychiatry, and not on economics or physics. There are equally good conductors which are vastly less expensive and nobody uses gold for dental fillings anymore.
• The trick which Archimedes used to distinguish gold from lead is no longer valid. The difference between densities of gold and tungsten is something like 19.2 versus 19.3 (tungsten didn’t exist in 300 BC). They actually find bars of tungsten plated with gold in bank vaults in New York; if those guys can’t use gold in a rational manner, what makes you think YOU could??
• The use of gold as a basis for money created gigantic grief all during the 18th and 19th centuries, creating cycles of boom and bust as money based on gold was lent out and then called back repeatedly. This led to William Jennings Bryan’s famous “Cross of Gold” speech.
• During the 18th century, Benjamin Franklin had become known as the father of script money, creating a super colonial economy based on pure fiat money. This super economy was crashed into depression by the British Crown re-imposing a gold standard on the colonies, leading to the American Revolution. Nobody ever fights a war over a tax on tea, that’s basically a fairytale.
• There is exactly one use for gold for which no other known material would work as well: soft, totally inert, and half again more dense than lead, gold would be the ideal metal for waterfowl shot. You could kill ducks and geese all day long with ordinary two and three-quarter inch shells, and number seven shot. Nobody would need magnum sized shells or magnum chambers in their shotguns anymore.
• The very things which make gold useful as money, also make it easy to steal and totally untraceable once stolen.
• All money is fiat money, as per Ann Barnhart’s lecture.
• Contrary to what bankers would have you believe, governments printing money, by itself, does not create inflation. It depends upon HOW governments create money and what they use that money for. Consider: two shipwreck survivors on an island have five dollars in their pockets between them from their previous life and there are five clams on the island. A dollar is plainly worth one clam. Nonetheless, one of the two finds a machete in the remains of their lifeboat; hacks a coconut tree up into a crude printing press; kills an octopus; prints up five more dollar bills with the press and octopus ink; and pays them to his companion to dig up 15 more clams… To the unbridled horror of the bankers, the guy has doubled the value of money on the island by printing it. The only two meaningful things in that picture were productivity and an element of trust, no gold or any other metal were required.
Time, money, intellectual capital, and energy used in the production of gold are essentially wasted, as is also electricity and money involved in Bitcoin mining. Every other feature of Bitcoin makes flawless sense; the coin mining feature, which is basically a computer simulation of the entire economy of producing gold, is regressive, inflationary, and counterproductive.
Basic history of money:
http://www.webofdebt.com
All money is fiat money, as per Ann Barnhart’s lecture:
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