“For example, money is not consumed after a transaction, but goods such as pork bellies and copper ingots are. Money is not directly comparable to goods.” Keith Weiner
One of the tenets of Dawn of Gold is that goods* and money** are different. Money is not the most marketable good. Money is not, never was and cannot be a good. Prior to 1500BC, Gold*** was locked away in the Pharaonic temples. It was Gold’s accumulation as a religious icon that caused its vast stock-to-flow ratio. Then, circa 1500BC, it entered the marketplace for the first time with an already established stock-to-flow ratio. That strange confluence of events is what gave Gold its monetary status and changed the history of the world.
Money is what we use to measure the value of a good – the value to us. A good has no intrinsic value, just the value that it has for the individual holding the money and doing the measuring. A variable value cannot be used to measure another variable value; thus, a good cannot be used to measure the value of another good. If a good cannot be money then, ipso facto, money cannot be a good.
In a situation of successful barter, all we can say is that both parties were prepared to give up the good that they were holding in order to gain the good that the other was holding. The values of neither good were measured, except against each other. With barter, objective value is lacking.
With its highly volatile value, fiat ‘money’ is mostly clearly thought of as a sophisticated trade good****.
With money, the value of a good is measured, then the deal is done and the money and the good changes hands. The good is then generally consumed; money is never consumed.
* A good is defined: an exchangeable, quantifiable value
** Money is defined: a known weight and fineness of Gold
*** Gold is defined: a store of stable value
**** A trade good is defined: an easily exchangeable good used to transfer value into the future.