4 ms·
Gold isn’t valued in dollars. You can sell gold for any currency. Oil is primarily transacted with dollars because it’s the worlds reserve currency. But if tha
by hmate9 4y ago
Gold isn’t valued in dollars. You can sell gold for any currency.
Oil is primarily transacted with dollars because it’s the worlds reserve currency. But if that were to change to whatever, you can still sell your oil and gold for whatever the new dominant currency is. Meanwhile your dollar is (presumably in this case) worth way less in terms of buying power than when you first bought it.
- simple-thoughts 4y agoYou can always barter anything for anything else, but how do you decide the rate to barter at? It’s determined by the rate for the most liquid markets for the two sides, because the price of an asset in the most liquid market is the price all other markets will follow. There just aren’t gold based markets that are even remotely comparable to usd ones, so the ratio of gold to oil is set by their respective rates in usd. To see an actual switch from usd to gold for valuing oil, you’d need to see the market liquidity migrate from usd/oil pairs to gold/oil pairs. Ghana making a political statement isn’t that.