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
Gold is simply the most useful metal.
If gold were cheap, we would use it for everything, from coating things we didn’t want to tarnish, to electrical wires, to every trace on a circuit board. It has a wonderful combination of being electrically conductive, thermally conductive, rustproof, non-toxic, antibacterial, easily workable, and usable with every metalworking application.
Jewelry, dentistry, electronics, metalworking – every generation of technology we find new uses for it. Why? Because gold is a heavy metal that’s remarkably non-toxic. You can use gold as everything from radiation shielding to weights.
But, it’s incredibly rare, and it’s impossible to manufacture in any meaningful quantity. You could spend all of the power generation on earth running particles accelerators, and you’d struggle to make a few grams of the stuff in a year. That leaves mining, and the existing reserves.
No, gold is not a scam like diamonds, or bitcoins. Gold is an ultra-rare metal created from the explosion of neutron stars, and it represents, in short, a tremendous amount of energy stored as a useful metal.
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