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The Feasibility of Gold as Money
TND Guest Contributor: Paul-Martin Foss |
The Royal Canadian Mint recently came out with an interesting product, a packet of 25 one gram .9999 fine gold coins. Each coin is individually packed in a removeable, individually serial-numbered blister pack. One gram coins are pretty small but their metal content is currently worth about $50 each. Between that and the development of CombiBars and CombiCoins, there are some very interesting products that could be used for day-to-day transactions in precious metals.
The common objections to using precious metal coins as money, or any coins for that matter, are:
1. Gold coins can be too small and easy to lose.
Answer: Coin purses. Use them. And if you can’t be trusted not to lose a few hundred dollars worth of small gold coins, what can you be trusted not to lose?
2. Coins weigh too much.
Answer: $80 of silver weighs about as much as the average smartphone. You didn’t have any problem adding that phone to your pockets, so why not some silver or gold coins?
3. Coins are too bulky.
Answer: Again, coin purses. You can easily fit thousands of dollars in gold and silver coins into a coin purse that takes up about 1/10th of the space your wallet does. And it’s certainly less bulky than the rubber iPhone protector most people insist on using.
There are also interesting developments ongoing in the world of precious metal-backed electronic currencies, and the convenience of electronic currencies is unparalleled, and major growth in electronic currencies is to be expected. But for those who enjoy the heft and feel of coins, products like the RCM’s Maplegram are an interesting development. Now if only the legal barriers to using gold and silver as money could be dispensed with…
Picture: Coin Update
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About Paul-Martin Foss:
Paul-Martin Foss is the founder, President, and Executive Director of the Carl Menger Center for the Study of Money and Banking, an Arlington, VA-based think tank dedicated to educating the American people on the importance of sound money and sound banking.
Prior to founding the Menger Center, Mr. Foss worked in the U.S. House of Representatives for seven years, including six years as Congressman Ron Paul’s legislative assistant for monetary policy and financial services, and one year as Deputy Legislative Director for Congressman Thomas Massie.
As Congressman Paul’s legislative assistant, he assisted the Congressman in his duties as Chairman of the Subcommittee on Domestic Monetary Policy by helping to develop hearing topics, agendas, and briefing Congressmen and their staffs on monetary policy topics. Mr. Foss also was responsible for the management of Dr. Paul’s monetary policy and financial services legislation, including the “Audit the Fed” and “End the Fed” bills, and was co-editor of Ron Paul’s Monetary Policy Anthology, a multi-thousand page compilation of hearing transcripts, lecture transcripts, and other documents related to Dr. Paul’s chairmanship.
Mr. Foss received his Bachelor’s degree from The University of the South (Sewanee), and Master’s degrees from the London School of Economics and Georgetown University’s Edmund A. Walsh School of Foreign Service.
This article appeared on the Carl Menger Center for the Study of Money and Banking and is reprinted with permission, “Creative Commons 4.0.”
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