How Did Gold Beat Out Every Other Precious Metal To Become Humanity’s Dominant Currency For the Last 2,600 Years?
Why has gold reigned as the world’s go-to precious metal for over 2,600 years? It’s not as rare as platinum, durable as diamonds, or malleable as copper. What is it about this metal that made it the standard unit of coinage, from China to Mesoamerica? It’s a very long story, but gold’s scarcity, durability, malleability, and universal appeal made it ideal for trade and wealth preservation, starting with the Lydians of 550 BC. Unlike tin, copper, or bronze, gold’s intrinsic properties allowed it to serve as a stable and universally recognized unit of exchange, laying the foundation for its historical role in economies.
In today’s episode, we explore gold’s history, the evolution of monetary systems (from China’s early use of paper money in the Middle Ages to Great Britain’s establishment of the gold standard in the late 17th century), and how the gold standard of the last century facilitated international trade and stability but was ultimately abandoned due to its deflationary pressures and limitations. The pivotal moment came in 1971 when President Nixon ended dollar-gold convertibility, ushering in the fiat currency era.
To discuss these topics is today’s guest, Collin Plume, author of “Silver Is the New Oil: Strategies for Profiting From the Next Industrial Revolution” and CEO of Noble Gold Investments. He offers insights into modern trends, including nations increasing gold reserves, gold-backed cryptocurrencies, and the future role of gold in global finance.
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