Ive never been able to understand the concept of gold. Why is it so valuable? How do countries know that the amount of gold being held by other countries? Who audits these gold reserves to make sure the gold isn’t fake? In the event of a major war would you trade food for gold? feel like people would trade goods for different goods in such a dramatic event. I have potatoes and trade them for fruit type stuff. Is gold the same scam as diamonds? Or how is gold any different than Bitcoin?
In: Economics
Quite a while ago, I heard an interesting Planet Money episode where they discussed why gold became a common currency. Their approach was to go through the whole periodic table and eliminate all elements that would be impractical for this purpose. Some because they were too common. Others because they were too rare. Or they didn’t exist in a solid state at typical earth temperatures. Or because they were radioactive, or not stable enough to maintain their composition.
By the time they’d eliminated everything that would be impractical, they were only left with the elements that are traded as precious metals.
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