I think the point is that money isn't linked to anything
£1= £1 - whereas in the past £1 = X grams of gold.

Gold has an absolute value whether we believe in it or not because gold is a useful mineral. It's a resource.

Google the phrase "fiat money" if you're bored.
( rob, Wed 7 Dec 2011, 13:25, 1 reply)

The absolute value of gold (as a metal) is irrelevant when talking about money
since it's the market value of gold as a precious metal that's theoretically backing up the money. And that value is entirely ficticious, just as the non-backed money value is.

Otherwise it would make more sense to use steel, which is generally useful and could be said to have value for that reason -- though even then, the value is at least partly fictitious, controlled by whatever the market will pay for it. Gold isn't much use for anything practical, apart from electronics.

It's valuable because it's shiny and it doesn't tarnish, but the same applies to (lacquered) brass. It's also rare, but then so is white dog poo, these days.
(moon monkey is busy making memories worth repressing, Wed 7 Dec 2011, 13:32, closed)

yeah it's a market - the value is all over the place
but it's unlikely to be zero as it has real world uses. Or if the value does hit zero it has a chance of rising again. Unlike a bit of paper which when hyperinflation hits normally stays a valueless bit of paper.

I'm not arguing for the wonderfulness of a gold backed currency btw - I was just trying to explain to the original poster that I wasn't making a semantic point, but that there's a real meaning to the idea that money is a confidence trick, or a lie as someone had it.
( rob, Wed 7 Dec 2011, 13:50, closed)

Psst.
We're not using the gold standard, anymore.
( monster munch person, man, woman... camera... TV?, Wed 7 Dec 2011, 14:56, closed)