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Why is gold worth anything?

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Moneybizam
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Why is gold worth anything?  Reply with quote  

Let me start by saying hi to everyone. I have been on other discussion boards/forums and I even manage one myself. I am 16 years old and run a lawn mowing business with my friend.

I have read basically the "beginners" guides to money and how the system works, but I cannot figure out why gold is worth anything at all. It was backed by the US Govt. and I'm sure many other countries, but what is so valuable about it. It is not a useful piece of metal such as steel or aluminum. It looks nice, but that shouldn't be a reason for the government to use it to back money.

Why would people want to back things with gold. Personally, I wouldn't want gold. It is not practical for really anthing. I guess my main question here is why gold and not something more useful like common metals? Does it have much to do with supply and demand since it is less common?

Thanks
Post Wed Jun 29, 2005 4:45 am
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David Briggs
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Beauty, durability and malleability. Doesn't tarnish and you can pound a chewing-gum-size piece of it into the size of a football field.

Its use as money follows from its ornamental and industrial usefulness, and has a long tradition back to ancient times. (One of the gifts brought by the three wise men.)

The widespread acceptance of paper money (and now mere digits, e.g. bank accounts) strikes me as far more amazing.

~~David
Post Wed Jun 29, 2005 1:24 pm
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akiva
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I would also add that gold, as opposed to other metals, is not only rare - but it is much easier to recognize than a peice of steel for example.

David poses an even better question, what makes a dollar worth anything? only our trust in US Government.
Post Thu Jun 30, 2005 1:29 pm
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Moneybizam
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I would think that people would want something more practical and useful other than rare. What keeps people's minds to still like gold as a form of trade/wealth today? If the world runs out of water (getting slightly off subject), nobody would care about gold, but they would want the water instead to show their wealth or to trade with - am I right?
Post Fri Jul 01, 2005 4:34 am
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David Briggs
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Yes, if the world ran out of water our whole value system would experience a major readjustment. As the world runs out of oil, we will likewise be forced to re-think the meaning of precious and treasure.

~~David
Post Fri Jul 01, 2005 4:58 am
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Moneybizam
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Excellent response. It gave me a much better concept on the whole idea. I was aware of how it was used in electronics, but most of the others you mentioned were new to me. Thanks for the informative response.
Post Fri Jul 01, 2005 3:07 pm
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LottomagicZ4941
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I don't know if it is Bibical but I have heard that heaven will have streets of Gold.

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Post Fri Jul 01, 2005 6:00 pm
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Adria.John
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Well, Anything that is rare is precious. Gold is a rare metal and doesn't found in plenty. That's why i is valuable and government consider it in the top priority that any other metal.

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Post Thu Jul 08, 2010 12:22 pm
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kingion10
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Well, I agree, it is quite rare, hard to extract and it doesn´t rust or discolor making it ideal for jewelry. Also there are many types of gold used with different purposes and having different prices.
Post Mon Jul 12, 2010 11:33 am
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freundfire
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and any cup is made of gold, like the world cuo that Spain has just won!!!1
Post Mon Jul 12, 2010 7:14 pm
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littleroc02us
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Think of it this way. When Katrina hit the Southern states, nobody woudl have been able to have traded gold for water or clothing. Services, food and water were tradable in time of need.

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Post Tue Jul 13, 2010 9:25 pm
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Adria.John
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Well, larger demands and less supply actually can make the prices hike to as much as sky.

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Post Thu Jul 15, 2010 7:49 am
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siestakey
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much better thn given post....

practical things give more knowledge in life more than theory knowledge.....
Post Thu Jul 15, 2010 3:42 pm
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