/biz/ - Business & Finance

>>1489596
There's no reason that even a tiny amount of gold couldn't simply be contained in a larger capsule type packaging along with assay information with laser engraving and the like. Or even if we have numerous reliable gold banks that issue gold backed bank notes (like it used to be for such a long time), so we can easily denominate it into useful trading values. But even if this weren't an option (which it is), there is always silver. And when that's not cheap enough, there is copper, zinc, and so forth. What makes gold attractive in particular over other metals is that it is fairly rare, distributed fairly evenly across the world, and represents wealth as it is expensive to produce. And it can be "cashed" or exchanged pretty much anywhere in the world. That doesn't mean there aren't other commodities that can do that as well, although gold has the right set of characteristics for use as money. And it's been used since ancient times for monetary exchange.

Further, I suggest you review the definition of what FIAT currency is, and understand that the use of precious metals as currency can never be classified as FIAT. Currency and FIAT currency are two different things.

"Fiat money is currency that a government has declared to be legal tender, but it is not backed by a physical commodity. The value of fiat money is derived from the relationship between supply (such as a printer that can print any quantity of notes at any denomination) and demand rather than the value of the material that the money is made of."

For example, if the government decided to put serial numbers on Monopoly money, or even dog shit, and start issuing this to the public, they could do that. In fact it would have no less value than the money people are used to looking at, so long as people had faith in it. And there's no shortage of faith among those who ignore economic fundamentals and 'go with the flow'. Even when we're over 200 trillion in the hole. More dominos, more risk.