Quoted post unavailable.
Pray tell why bitcoin is inevitable as opposed to the gold standard :)
How did the gold standard work?
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Re: How did the gold standard work?
#12There are real practical problems with gold and changing economies. What happens when your population goes up - you need more gold. Or economic growth. Similarly if gold is discovered like Spain's Latin American winnings it causes inflation.
Re: How did the gold standard work?
#13Quoted post unavailable.
Pray tell why bitcoin is inevitable as opposed to the gold standard :)
Well, if you had to pick one to build a standard on in the modern world, I'd certainly pick bitcoin.
Unlike gold, bitcoin is a network protocol available to anyone on the planet with an internet connection, can be programmed and improved, and you can secure in a way such that it's impossible to steal through simple violence.
But obviously gold or bitcoin is a false dichotomy.
Re: How did the gold standard work?
#14Question though, does Fort Knox gold still exist?
6k tons of gold is held in Manhattan by the Federal Reserve: https://www.wsj.com/articles/the-fed-has-6-200-tons-of-gold-...
My understanding is that most of that gold isn't the US's, but other countries' gold that the US is holding for them (because securing tons of gold isn't easy).
Re: How did the gold standard work?
#15The fact that gold reserves are still a very common feature in almost every country indicates to me that our governments aren't completely committed or secure in this grand experiment of unbacked fiat currency that's been going on for 50 years. https://tradingeconomics.com/country-list/gold-reserves And since the 2008 financial crisis and recent events with Russia, it seems like that uncertainty might be justified.
I'm surprised by Canadians having 0% Gold according to that, when they actually mint one of the most popular bullions: https://en.wikipedia.org/wiki/Canadian_Gold_Maple_Leaf
Re: How did the gold standard work?
#16Question though, does Fort Knox gold still exist?
https://en.wikipedia.org/wiki/United_States_Bullion_Deposito... “… currently holds roughly 147 million troy ounces (4,580 metric tons) of gold bullion, over half of the Treasury's stored gold.”
> (4,580 metric tons)
Somehow I always forget the actual (as opposed to figurative) definition of metric ton: “unit of weight equal to 1,000 kilograms (2,205 lbs)”
So 4,580 metric tons is 4,580,000 kg (10,098,900 lbs.)
That’s… a decent amount of gold.
> gold bullion
Bullion: “uncoined gold or silver in bars or ingots.”
Random page that lists heavy objects: https://247wallst.com/special-report/2018/05/11/the-heaviest...
(Interestingly it includes a lot of objects related to the current Russian invasion of Ukraine, even though the article was written 4 years ago.)
Re: How did the gold standard work?
#17Quoted post unavailable.
I'm really into bitcoin but comments like these make me cringe. Please add to the discussion or don't say anything at all.
For example you could draw parallels between a gold standard and a bitcoin standard and highlight why a bitcoin standard makes more sense than a gold standard if fiat currencies collapse.
Re: How did the gold standard work?
#18The fact that gold reserves are still a very common feature in almost every country indicates to me that our governments aren't completely committed or secure in this grand experiment of unbacked fiat currency that's been going on for 50 years. https://tradingeconomics.com/country-list/gold-reserves And since the 2008 financial crisis and recent events with Russia, it seems like that uncertainty might be justified.
I'm surprised by Canadians having 0% Gold according to that, when they actually mint one of the most popular bullions: https://en.wikipedia.org/wiki/Canadian_Gold_Maple_Leaf
Canada is definitely the odd exception. I don't know what's going on there.
Re: How did the gold standard work?
#19> For a good portion of the time that the Bretton Woods system actually operated, the head of that Treasury division was Paul Volcker (yep, THAT Paul Volcker!)
Bretton Woods operated from 1945 to 1971. Paul Volker served as the under secretary of the Treasury for international monetary affairs from 1969 to 1974. What am I missing here?
Re: How did the gold standard work?
#20Well, let's start with commodities. They have value, see, and that value contains both the exchange value (what it's worth in exchange for another commodity) and the use value (the value it provides as a commodity, like a coat keeping you warm.)
But exchange value of commodity to commodity is a pain, so inevitably people tend to turn to a commodity that can be the "money commodity". A universal store of value, in this case gold.
Then exchange becomes commodity -> money -> commodity. Gold becomes the interface between commodity exchange.
But, over enough time something else happens. Hoarding, luck, and gains in the money form mean someone now has enough spare gold to skip straight to money -> commodity, which then can be sold for more money when prices fluctuate.
Now you have two flows: commodity -> money -> commodity and money -> commodity -> more money.
The first one uses gold as a means of smoothing the interface between commodity transactions, the second, however, makes increasing the store of gold the goal. But that surplus gold doesn't come from just anywhere. It's not just ethereal excess, it needs to come from either the raw material value or the labor that was used to produce the commodity. While rarely, surplus value comes from making a commodity cheaper, the bulk of the excess gold in a money -> commodity -> money transaction comes from extracting value from labor.