Re:Why Gold?
by barrkel on Friday March 11, 2016 @02:46PM
(#11268996)
> - A medium of exchange
> - A store of value
> - A unit of account
Note that these are all social attributes. They are true because and only because society treats them so. A medium of exchange works because counterparties to the exchange accept the medium. A store of value works because counterparties in the near future will accept the currency at something similar to its current value - its value isn't heavily fluctuating. And a unit of account works because people physically write up accounts using the currency as a unit, issue invoices and demand payment using the unit, issue debt and demand interest, borrow and pay interest, all using the unit.
It's all a social construct.
(Gold's value is a social construct too, of course.)
> - A store of value
> - A unit of account
Note that these are all social attributes. They are true because and only because society treats them so. A medium of exchange works because counterparties to the exchange accept the medium. A store of value works because counterparties in the near future will accept the currency at something similar to its current value - its value isn't heavily fluctuating. And a unit of account works because people physically write up accounts using the currency as a unit, issue invoices and demand payment using the unit, issue debt and demand interest, borrow and pay interest, all using the unit.
It's all a social construct.
(Gold's value is a social construct too, of course.)