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<p>[QUOTE=&quot;kaparthy, post: 679861, member: 57463&quot;]<b>Money is a claim of honor.</b></p><p><br /></p><p><br /></p><p><br /></p><p>Don&#039;t be silly...&nbsp; I started reading Ayn Rand 45 years ago when I was 15.&nbsp; I went the route with British sovereigns and Swiss 20F and all that.&nbsp; I still like gold.&nbsp; But somewhere along the way, as a numismatist, I could not deny that gold and silver are just kinds of money, as pens and pencils are writing implements.&nbsp; The Austrians are incomplete on this point and in fact never shed socialist ideas about the social definition of money.&nbsp; Any standard textbook -- as well as Marx and von Mises both -- will tell you about commodity money and its evolution.&nbsp; Supposedly, money serves three purposes:</p><p><br /></p><p>Store of Value</p><p>Medium of Exchange</p><p>Unit of Account.</p><p><br /></p><p>Those are three independent things.&nbsp; They can be related.&nbsp; (Dogs are pets.&nbsp; Cars are conveyences. You can put your dog in your car ... even teach him to drive...&nbsp; Dogs are not cars.)</p><p><br /></p><p>Gold is a store of value.&nbsp; Period.&nbsp; You need some to balance your portfolio, to cushion against risks.&nbsp; Hard core gold bugs recommend having 10% of your net worth in gold.</p><p><br /></p><p>The Dollar is a unit of account.&nbsp; Multinational corporations headquartered almost anywhere often choose the Dollar for bookkeeping.&nbsp; We all do.</p><p><br /></p><p>Paper dollars (coins, etc.) are hardly a medium of exchange.&nbsp; Really for almost a century, physical money has been relatively unimportant for commerce.&nbsp; It is a daily convenience, to be sure, for small transactions, but most of trade and commerce is carried out electronically.&nbsp; Plan to travel to Europe from the USA?&nbsp;&nbsp; You might need some UKP or EUR in your pocket, but, really, your credit card is your medium of exchange.&nbsp; The transfers among currencies is handled electronically for a small aggio.&nbsp; No need for physical cash, or not much.</p><p><br /></p><p>A couple of years ago, I got curious about Stock Certificates, scripophily.&nbsp; Last year, I read a biography of John Stewart Kennedy, the banker to J. J. Hill and a dozen other railroads.&nbsp; Paper promises -- making them and more to the point, keeping them -- built this nation.&nbsp; Gold had little to do with it.&nbsp; Physical gold was a fraction of the wealth... and is even less so today.</p><p><br /></p><p>Nice stuff, gold.&nbsp; Love it.&nbsp; But &quot;real&quot; money??&nbsp; You confuse yourself with mystical floating abstractions, the savage&#039;s limited epistemology in tangible, concrete objects. </p><p><br /></p><p>What is money?&nbsp; Define money.&nbsp; Then you will know what &quot;real&quot; money is.[/QUOTE]</p><p><br /></p>

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