Bradley in DC, I want to continue to argue that gold is a type of fiat money, fiat meaning we put "faith" in that it will be accepted as a unit of stored value in exchange for actual commodities that we consume while having little consumption value itself, other than as jewelry. It's scarcity and present impossibility to "counterfeit" makes it an excellent fiat currency. However:
Aurum Metallium, as it is called on AU contracts, has many uses. It is non-corruptable-does not oxidize nor salt out. In its monoatomic form..the one that alchemists strived to replicate.. it has many anomolous properties including loss of 5/9th's of it weight at one temperature and at another higher temperature actually causing the vessel it is in to have a negative mass. At another temoperature it disappears from the 3rd dimension though an instrument dragged through where the pile was will show a trail when the sample cools. It has a phi fractalled, self embedding and self sustaining wave imprint with a superdeformed yin-yang apiring of electrons and repairs the telemeres at the ends of DNA discarrding errors in replication sequences while upping the electron volt potential in the DNA strand by 10,000 times. As well monoatomic gold is a superconductor at room temperature. Molecular or metallic gold is the best conductor of electricty.
1. The "Gold Supply" constantly grows through mining by the tens or hundreds of tons per year. New gold enters in private hands so its entry into the marketplace is already inherantly unfair to the general public. In effect, wealth was created without having to produce value to the community, in a similar way as printing paper money on a machine, though more labor intensive.
Beside its practical uses the value of it comes from its scarcity. It cannot be countefeited. In regards to your analogy of the people and the 1000 grams of gold. I find it interesting that you can still purchase the same amount of nails of iron for the same amount of gold that you could a few hundred years back. As the gold is circulated amongst the community of commerce it is split into other commodities such as hard goods and consumables. These in turn are distributed to the purchasers who gained their purchasing power through the sale of their services or product. In a robust economy the goods and services cycle through at a rate where it is not necessary to have gold on hand for each purchase per se. In effect the entire set of goods, services, commodities and products are benchmarked to the gold unit price and considered a fraction thereof depending on the amount of sweat labor that was incurred to produce said product, perform said service, or grow, mine or refine said commodity. Fiat currency has no intrinsic value ither than bumfodder or firestarter. Even simple coins are more valuable. I can stack coins of alternating metals, pour acid over them and i have a battery. Silver as well is a valuable commodity due to it antiviral and antibiotic properties. As well the use of silverware was for more than show for many poisons and biological contaminations caused blackening of the silver and alerted the diner they were about to get a bad tummyache if they continued their reposte. Copper again has many uses for tools, weapons and as a cupric salt to be used medicinally for arthritis and other inflammation.
2. By its nature, using gold and silver as money has produced a long history of slavery, war, theft and other atrocities as there is tremendous incentive by those who are prone to violence to go straight for the gold & silver as opposed to producing goods and services that have tangible value to the community.
Hence the need for a good defensive force and fortress lockboxes. The gold and silver are what benchmark those goods and services that have tangible value to the community besides having tangible value in and of themselves both in utiltarian toolmaking and technological spheres
3. The fair distribution of gold, or money backed by gold, is rarely talked about by gold money advocates. It's an easy system for Americans to promote as they have (once had?) enormous gold stores, not all of it acquired ethically. What about countries that have no gold? Most of the above ground gold is in the hands of elite private citizens or heavily armed 1st world nations.
Somewhat true. If balance of payments ar no longer made with engraved paper then alot of that AU metal will come back into the system. I personally saw in one years contracts come through my hands that totalled over 125,000 MT of Aurum Metallium in private hands. The Thai Royal Court has gold that is not GLD'hallmarked and registered in the system sitting in teachests and attics and basements lockrooms amounting to over 120K MT as well as in the main bank vaults in Bangkok Thailand that is hallmarked at about 60,000 MT. many of the other far eastern royals and tribal royals keep their gold there as well. Thailand/Siam has not been invaded successfully for a long, long time..The Sultanate Of North Borneo has at least 5000MT sitting in an Australian vault.. The UAE has 45,000 MT sitting around for sale..If all these piles of gold had to be used to purchase these peoples lifestyles or exchange payments between goverments alot of this hoarded gold would circulate back into the markets. Both Russia and China full well understand this and are buying up any and all private contracts floating through the non metal exchanges market. If you had 10,000MT of AU metal I could sell it within four days and pull a cool 1% off the top.
4. Gold does not fairly represent the goods and services exchanged for it, because gold lasts forever and food, consumer goods, etc. last for days, weeks and/or decades. I believe it was Silvio Gessell who points out that true neutral money must fall in value to best mimic the underlying goods and services.
See my gold and silver as benchmarks spiel aove. Should we prefer a benchmark that corrodes in value, loses it weight after time or perishes?
5. Gold money does not address the problem caused by the growing gap between national production and national income due to automation. We don't earn enough to pay for the goods and services that we've produced. This falls into the realm of National Dividend, Basic Income Guarantees and, I believe, the work of Henry George.
The work of Buckminster Fuller spoke of ephemeralisation. The idea that more and more can be accomplished with less and less. Take the CPU for instance. It is made of silicon..probably the most abundant element on the face of the earth. Mix a few impurities in and cook it just right and etch and inlay very minute amounts of copper and gold and you have a very powerful calculating device. What would take years of intensive intellectual labor, gallons of ink, reams of paper and the requisite food and shelter needs to sustain the human calculator/s can be done in milliseconds by the recrystalized grains of sand and threads of metal. Mind you this could not have been accomplished without the original sweat and work of the previous labours in that field. In the labor fields ephemeralisation technologies are the keys to Americas future. We have the advantage in things like writing computer code as the syntax is in our native tongue. America will have to develop and then sell on the world market its new ideas and technologies based around ephemeralisation. Ephemeralisation makes things cheaper after inital tooling costs are repaid. The market determines that as the chip wars between Intel and AMD have shown. The various far eastern chip makers as well assist in lowering the costs through their fierce competition for a share of the marketplace. I could probaly write way too much on this so I will ephemeralize using my example above. We are not in the big machine Industrial Revolution age anymore and must adapt accordingly. Instead of watchng TV and whining they lost their manufacturing job they should be getting a professional software application and learn to use it or take their technical knowledge and invent or improve something and have a far eastern manufaturer knock a cheap prototype out for you to shop around. If you can write C++ for instance you can have any one of 100's of jobs paying real good money in any major or medium sized Sunday newspaper.
Sorry to go on at length. I'm not trying to be a know-it-all, as I am just learning all this in the past year and think that all ideas should be on the table and that we should equally discuss the flaws of using gold as money as we do its strengths.
Gold is a benchmarker. The sweat equity implied in its intrinsic value is distributable apportionately across all commodities and services in ratio to their sweat equity.
I am not a scholar but this is what I have derived from my brief tenure in the world of megaton gold trading and high finance derivative MTN's and currency swaps. It was giving me grey hairs so i went back to my music, arts and coding where i am much happier
Best Regards
Randy
