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>why [...] would people prefer gold instead of, say, water, toilet paper.. "Hi here's your monthly pay it's $5,000 of toilet paper. Where would you like me to
by DINKDINK 7y ago
>why [...] would people prefer gold instead of, say, water, toilet paper..
"Hi here's your monthly pay it's $5,000 of toilet paper. Where would you like me to park the truck that's full of it?"
The purpose of a money as a technology is to be a highly salable good that stores wealth across time and space.
Taking your salary in toilet paper isn't good because it's not as salable and it also can rot and degrade. If someone tells you that it's good your money rots because then everyone will have to work more than if their money was more robust (inflation) they're probably the person that can create money costlessly but charge you for it (a bank). If they claim that it's bad if the amount of money required to produce something decreases (deflation) when reducing the consumptive inputs (labor, materials, yes even money) creates a more efficient product, is less demanding on the planet, they are probably that gain their wealth from taxing and taking your things (states).
- keymone 7y ago> Hi here's your monthly pay it's $5,000 of toilet paper. Where would you like me to park the truck that's full of it? Don’t know if you realize this, but that’s literally what was happening in Ukraine (and probably elsewhere) during 90s after USSR collapse. People were paid with products of factories they worked on. Toilet paper, teapot sets, boxes of matches, etc. not fun times.
- exelius 7y agoSupposedly Russian sailors were paid in vodka during the same period.
- DINKDINK 7y ago>Don’t know if you realize this Yes, it's what I was referring to. Trade will occur regardless of what happens. If factories run out of a fiat money, they'll offer to trade the factory outputs for worker labor. It's just that the people with the most performant money will survive the best.
- jnurmine 7y agoIn a normal situation it would not make sense but: > if the situation becomes so bad that government-issued money is worthless If you are receiving a salary (!) in a non-gold currency, and have an effective method of converting that currency to drinking water, food, toilet paper, medicine, etc. then, even if it is a crisis, what do you need gold for? And if the value of government-issued money has completely collapsed, chances are that things are so bad that you'll need things for your immediate survival. Also, as there won't be a central instance setting a commonly-agreed value of gold, it is up to each supply to set their own prices, so how would gold keep its value?