The commonly articulated flaw of fiat ‘money’ is that its value is unstable. While true, the full reality is worse.
There is a one-thousand-year track record of governments, always and everywhere, degrading paper money till, ultimately, it ends up worthless. At some point, paper always completely fails.
There is no virtue in paper that is ‘backed’ by Gold. Of what good is it to someone who is holding such paper if they cannot access the Gold? Only paper that is redeemable for Gold, on demand, can be trusted. But not totally. Who knows when the paper will be legislated no longer redeemable for Gold? All it takes is the stroke of a politician’s pen.
Gold is the only money for one simple reason: it is the only store of stable value that the world has ever known. Since 1024AD (China), governments have tried to synthesize Gold’s stability of value; they have all failed. They always will fail.
Paper ‘money’ may, or may not, hold a stable value for a while. But stable as measured by what? Well, Gold of course – what else?
As Gold is the only guaranteed stable value, it is thus the only measure of value.
The entrance of Gold into the marketplace circa 1500 BC was the precursor to social man, rather than tribal man. It was also the beginnings of the modern world.
The absolute, stone cold, certainty of Gold’s stability of value, over unlimited time, changed the world.
Gold’s absence from the economy is changing it again. The degradation can be witnessed by all with eyes to see.