![]() To the best of my understanding, precious metals were chosen as a medium of exchange because they do not oxidize easily and remain in an uncorrupted form. I am not an expert on the history of gold. Significant fluctuations for sure, but in the long run, it remains stable. Imagine what would happen to the price of gold if all the metal in the vaults (owned by central banks or other hoarders) were to be sold.Īnd yet the value holds. But this “natural” demand is not even a close match for the existing above-ground supply. It has also survived the loss of its utility as a convenient medium of exchange.Ĭertainly, gold has demand from the jewelry industry and some industrial utility. ![]() Gold meanwhile has survived the rise of fiat and major economies moving away from the gold standard. ![]() Silver had its run during some periods and in some cultures, but silver has become “tarnished” as a store of value. How did gold become gold? And, more importantly, why is gold staying gold?
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