Here's a thought experiment - would the amount of gold a country has be expected to correspond to the amount of money that country's economy needs? I believe th

Here's a thought experiment - would the amount of gold a country has be expected to correspond to the amount of money that country's economy needs? I believe the answer is - absolutely not. So we can set some conversion rate to get things started with the correct kind of corresponding amounts. Great. But - over time, both the amount of commodity available and held, and the amount of money the economy needs will shift. Can we expect the conversion rate to stay the same then? Again, the answer is no. That's why pegs to commodities (i.e. gold backed currency) or other currencies always fail eventually - they can start off fine but will always drift away and you either have increasingly large inflation or deflation when things don't match up (which ironically is exactly what the proponents of commodity-backing claim it prevents, but the history is pretty clear). It doesn't matter then about whether the mining industry is 'real' and if the financial industry is 'artificial', as interesting as the argument is. Practically gold-backing always tends to fail, so it's a moot point.