Gold

[Neil Johnson]

The MAIN reason (and I agree that it's work-ability is a good secondary
reason, and I like the comment about cavemen finding it 'cause its shiny)
gold is used as a medium of exchange is because it is SCARCE.

If a modern day alchemist figured out how to easily turn lead into gold, it
would become worthless (well it might still be valuable when it was made
into art objects, like clay is).

All of gold's "romance" arises  from this scarcity.

I always liked the sub-plot in Scott Adams "Hitchhiker's Guide" books where
the accounts, middle managers, and "telephone sanitizers" that were sent to
earth to "prepare" for future inhabitation decided to use tree leaves for
currency, then set about to burn down all the trees "in order to control the
money supply".


-Neil


----- Original Message -----
From: "Julian Assange" <proff at iq.org>
To: <cypherpunks at einstein.ssz.com>
Cc: "Sampo Syreeni" <decoy at iki.fi>; <cypherpunks at einstein.ssz.com>
Sent: Monday, November 19, 2001 9:24 PM
Subject: Gold


> > Yes, but what this thread has ignored is that gold (and other
> > densely precious things) were valued *in and of themselves* and so
> > using them as money was not symbolic.  You traded your goat
> > for a goat's worth of gold; if trust evaporated overnight
> > the gold is still worth something.  Similarly with barrels
> > of oil.  If you discover a lot of it under your topsoil, you
> > get wealth because the substance itself has utility.
>
> Gold has many industrial uses, but its value has historically
> commanded a higher price not primarily because of its demand for
> fillings or filters but for its demand as a currency, for which it
> is naturally suited, being easily identifyable, measurable, divisible,
> liquidifyable, transportable and of predictable supply.
>
> If you trade gold for goats someone else is trading goats for gold.
> They're almost certainly not buying fillings, but something that's
> useful to them as a medium of exchange.
>
> --
>  Julian Assange        |If you want to build a ship, don't drum up people
>                        |together to collect wood or assign them tasks and
>  proff at iq.org          |work, but rather teach them to long for the
endless
>  proff at gnu.ai.mit.edu  |immensity of the sea. -- Antoine de Saint Exupery