I hear some economics arguing that currency should be pegged to gold as a way of ensuring that its value isn’t arbitrary / volatile but I don’t understand how this would solve the problem. I understand that gold is a scarce resource that is difficult to mine but is it this alone that gives it intrinsic value ?
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Its inherently valuable because of supply and demand, gold is worth $100 since someone out there is willing to pay $100
so really I’d argue no more or less inherently valuable than anything else. obviously gold has been valuable for.. all of recorded human existence? so does make it more ‘inherent’ than some random currency that has only been around for a couple hundred years or so
I mean obviously, its shiny, doesn’t tarnish, etc etc etc but that all just boils down to supply and demand in the end, if people want it, if it can be traded for other things, etc..
50 people with no food stranded on an island with tons of gold but limited food wouldn’t value it at all and it would be pretty worthless, the value isn’t REALLY inherent
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