Collapse of EU??

[Mateusz_Zboj]

Oh sure, but you don't make wealth out of gold (not entirely true today), gold symbolises wealth.

[dagrimreefah]

Oh sure, but you don't make wealth out of gold (not entirely true today), gold symbolises wealth.

That is utterly false. Gold has REAL wealth: it takes effort to produce, it is extremely rare, it is very useful (look inside most of your electronics), and it is non-corrosive. It has value (wealth) just like a refrigerator full of food has value; or a computer. For you to state that gold has no true wealth or can't create wealth just underscores your misunderstanding of economics.

If gold has no wealth, I'll take your gold off of your hands for a dollar an ounce :p

[Mateusz_Zboj]

In the past it only had artistic value, right? edit:And made currency. But some people thought that if they make a lot of coins they would be able to rule the world. Sure they did, for some time. Next era they were the poorest chaps in Europe due to inflation. Just enlighten me if I am mistaken.

[dagrimreefah]

In the past it only had artistic value, right?

Gold? AFAIK it has been the most accepted good as money in history.

[dagrimreefah]

In the past it only had artistic value, right? And made currency. But some people thought that if they make a lot of coins they would be able to rule the world. Sure they did, for some time. Next era they were the poorest chaps in Europe due to inflation. Just enlighten me if I am mistaken.

You forget about politics. In order to become a power, you must have infrastructure and workers. Things can't just produce themselves, clothes and food has to be produced somehow. Just like gold. It has to be produced. If you are a dictator thirsty for power, it is not just about producing a lot of gold; gold only facilitates trade (money).
That's where taxes come in. Instead of having to micromanage every aspect of trade and production to make sure you get your cut, you just tax people for their gold. But you can only tax so much, or else your working class will get unruly. Also, your facets of production might go under if overtaxed.

Solution? Get rid of gold (a money you actually have to mine, smelt, and refine) and replace it with funny money, printed by a "central bank" (cartel of banks). Then, you can spend all of the money you want like a credit card with no limits, and the bill is footed to the people who get the printed money LAST, AFTER PRICES HAVE BEEN ADJUSTED FOR INFLATION. The WINNERS in this situation are the people who get the printed funny money first (government) and the losers are the ones who get it last (you). Under this condition, a politician or dictator is able to spend as much as he pleases without having to directly tax the population; the people are indirectly taxed through INFLATION and most people are so dumb they can't connect the dots to realize why the price of food, gas, and gold for that matter, and basically the prices of EVERYTHING are and have been steadily increasing in terms of dollars (and Euros).

[Mateusz_Zboj]

Yup, all the side effects of currency system.
The ideal theft...
Though, of course since its much better than barter.

Although, weren't it that Spanish had overminted gold from new world, it lost value and then the problems started for both aristocrats and common? (I mean I was refering to mercantilism)

[dagrimreefah]

I'll admit, gold, or any saleable good used as a currency, is far from perfect. Spanish mercantilism certainly wasn't enough to offset the overall global value of gold. But overproduction of any good will drive its value down. But, is that necessarily a bad thing? On the contrary, I think it is a good thing. Cheaper goods (including cheaper gold or money) means poorer people are suddenly wealthier. What's wrong with that?

For example: in the past, only the rich were able to afford the luxury of listening to music while they dine. With the "overproduction" of music and the technology to capture, store, and replay that music, now even the lowliest of peasants can enjoy listening to music while they eat. Or another example: kings used to have to urinate in a bucket and throw it out of their window. Now even the poorest people enjoy the luxury of toilets. This is because of technology yes. But technology has helped us create an "overabundance" of goods, allowing for even the poorest to enjoy luxuries the richest aristocrats of the past could only dream of.

EDIT: An overabundance of gold used as money, for example, doesn't create inflation, btw. It creates deflation, which as I stated above is a good thing.

[Mateusz_Zboj]

How does it create deflation?
You mean, that it has some standart where it cannot go beyond, because of the material it was made of? (hey let's melt the coins, poof valuable artistic material and less coins->deflation)

[dagrimreefah]

How does it create deflation?
You mean, that it has some standart where it cannot go beyond, because of the material it was made of? (hey let's melt the coins, poof valuable artistic material and less coins->deflation)

No, it means that it takes more gold to produce a unit of currency (i.e. more gold to make a dollar), since there is more gold in existence. This means you need less dollars to buy things, i.e deflation.

[Mateusz_Zboj]

Hmm I was still about that system without banknotes... nevermind
Are you sure this relation chains relations with all other products?