Replies

No, an ounce of gold wouldn't be a sufficient amount upon which to base an entire monetary system. But of course, the world never has and never will be reduced to owning a single ounce of gold.

You see, money is a commodity, but it is fundamentally different from any other commodity: its essential purpose is as a medium of exchange and a store of value.

Throughout history, two commodities have been repeatedly selected by free people and free markets as vastly superior to any other commodities for these purposes: silver (for smaller puchases) and gold (for larger purchases.)

There are several fundamental characteristics that make a commodity a good choice as a medium of exchange and a store of value. Going from memory (my formal economics education was over 30 years ago), those characteristics are:

1. Homogeneity. One unit must be as close as possible to any other unit so that the each unit is of equal value and therefore interchangable.

2. Divisibility. It must be capable of being broken into pieces or parts to accommodate transactions of many sizes.

3. Transportability. This may be the same as No. 2 above.

4. Scarcity. The commodity must be so difficult to find or create that its aggregate numbers cannot easily be increased so as to decrease the "store of value" of that which has been set aside or "saved."

5. Relative lack of intrinsic value. It cannot have significant other uses which generate significant demand that could skew its value as a medium of exhcange and a store of value.

There are probably more hallmarks of a good currency, but that's all that I can recall at this time.

You can see why gold and silver would have emerged over and over and over again throughout history as the currency of choice of free men and free markets. The scarcity requirement is probably the most imporatnat, and the one which eliminates paper fiat money as an acceptable medium of exchange and a store of value.

BTW, I find your mocking and condescending tone especially combined with your ignorance to be most unbecoming.