Quote Originally Posted by Olduvai View Post
I don't see gold as a finite commodity, it isn't being consumed. It's (the only real) money..
Read "The Remonetization of Gold" by Gary North

If gold is to be re-monetized, then this must mean that it has been de-monetized. But isnít gold money?

No, gold is not money. It has not been money for Europeans since 1914, when the commercial banks stole it from depositors at the outbreak of World War I, and central banks then stole it from commercial banks before the war was over. Gold has not been money for Americans since 1933, when Roosevelt unilaterally by executive order stole it from the public.

Gold is high-powered money for central bankers, who settle their banksí accounts in gold. But this is so far removed from the decisions of consumers that I can safely say that gold is not money.

The question is: Will it ever again become money?

This is the most important of all monetary questions.


Money is the most marketable economy. Gold is therefore not money. You have to buy gold from a specialized broker. There are so few gold brokers any more that they are all known to each other. Local coin stores donít do much business in bullion gold coins such as the American eagle or Canadian maple leaf. The large wholesale firms like Mocatta donít deal with the public. There are so few full-time bullion coin dealers that you could have a convention of them in a Motel 6 conference room. (When was the last time you were in a Motel 6 conference room?)

But . . . it costs $39 to rent a Motel 6 room. That tells us something. Itís not $6 a room any longer. Inflation has done its work.

Money is liquid. Liquidity means that you can exchange money for goods and services directly without the following costs:
  1. Advertising
  2. Discounting
  3. Waiting
There is a price spread between what you can sell a gold coin for (in money) and what you buy a gold coin for (in money). Gold coins therefore are not money.

I realize that old-time gold bugs go around saying "gold is the only true money" and similar slogans. These slogans reflect a lack of understanding of either gold or money.
The rest of the article is well worth reading.