Is gold an example of money?

Under a free market system, gold is a currency. Gold has a price, and that price will fluctuate relative to other forms of exchange, such as the US dollar, the euro and the Japanese yen.

Is gold an example of money?

Under a free market system, gold is a currency. Gold has a price, and that price will fluctuate relative to other forms of exchange, such as the US dollar, the euro and the Japanese yen. The division of labor will survive because gold exists and gold is money. It is free market money that does not depend on the US dollar.

Gold was introduced into economies mainly because it was good money, not because it was shiny or made good jewelry or something like that. What makes it good money also makes it good jewelry, but that's not why it's primarily valued. It is valued because it is good for distributing other goods and services fairly. This good money allowed trade because of all its physical properties and its rarity, and that is how civilization began.

Ultimately, goods and services are exchanged for gold, even today, not for paper dollars, but for gold that can still be purchased with paper dollars. Gold is the metal we'll turn to when other forms of currency don't work, which means that gold will always have value in difficult and good times. Gold can stimulate a subjective personal experience, but it can also be objectified if adopted as an exchange system. And other nations had maintained a gold standard, the global supply of money would be limited to the available gold.

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