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> The gold and silver standards were established by central authorities. No, this is false. Gold and silver had innate value long before anyone "in authority"
by lutusp 13y ago
> The gold and silver standards were established by central authorities.
No, this is false. Gold and silver had innate value long before anyone "in authority" declared this to be so. In fact, central authorities eventually recognized the value of gold and silver, they didn't declare it or bring it into being.
The really remarkable event, that cements the role of modern government in economic matters, was the relatively recent unlinking of paper money from the backing of gold and/or silver. This step was taken for a number of excellent reasons, but it was predicated on the idea that the public will have faith in the stability of the economy, not on the innate representational value of paper money.
- philwelch 13y agoSo the 19th century political controversies about switching from a silver standard to a gold standard never happened?
- Double_Cast 13y agoCurrencies have existed since the neolithic revolution?
- lutusp 13y agoSomething like that happened -- in the 20th century, not the 19th. And the outcome was that the public accepted the unlinking of paper money from a specific standard of value.
- philwelch 13y ago1896 was still technically in the 19th century. http://en.m.wikipedia.org/wiki/Cross_of_Gold_speech http://en.m.wikipedia.org/wiki/Cross_of_Gold_speech
- lutusp 13y agoNevertheless, the public accepted the delinking of currency from precious metals, and modern economies would collapse if this were not true (too much economic value to be represented by existing stocks of precious metals).
- philwelch 13y agoOf course they did, I don't know why you think I'm arguing with you on that point.