Why was gold so valuable to people who lived off of the land. I would think that a more useful metal (e.g. iron) would be more valuable even though it is more common. If people are concerned about fulfilling basic human needs - food and shelter - then why wouldn’t fertile soil or good seeds be of more value than gold? And how/why was our money backed in gold?
WAG - Shiny, rare, and widely agreed upon medium of exchange.
Economist Peter L. Bernstein explains gold’s initial popularity in this interview:
Not only is it exceptionally beautiful and rare, but when found it is remarkably easy to form into coins or jewelry of any sort. Furthermore, gold, unlike many other metals, is chemically inert for most practical intents and purposes - it doesn’t rust or tarnish.
Gold is the perfect precious metal - rare, beautiful, permanent, and useful.
Just FYI…you don’t find iron in the ground as you know it. It has to be smelted from iron ore.
Malleable, ductile, doesn’t corrode (barely), and a very good conductor of electricity (although silver is better).
I’m pretty sure the electricity angle wasn’t crucial to people living in the neolithic age. The rapid conduction of heat, though, might have struck them as interesting.
The simple answer is that it wasn’t.
Gold was predominantly used by kings and equivalents, merchants and traders, and other city-dwelling people who no longer lived on the land, but needed a common medium of barter. Food wasn’t very convenient for this - it was bulky and spoiled - although spices, small and long-lived, made good trade tools.
But most people who lived off the land would have no need for gold and likely couldn’t used it if you dropped it in their laps.
Ah… so that’s what I smelt.
a royal set up for lieu
Gold was valuable, IE Money because:
Convenient - A man could carry his wealth with him
Consistent - 24 Karat = 24 Karat. Diamonds and artwork are too subjective
Durable - Ain’t going anywhere. Tobacco spoils.
Divisible - 1/2 ounce is worth 1/2 of a full ounce. Can’t make change for land.
From Doug Casey’s CRISIS Investing for the 90’s.
Just to fill in the one blank: good seeds are usually so common as to be nearly worthless. Good seeds come from good crops by definition. A good crop will produce billions of seeds. The value of individual seeds is tiny. While it’s possible to seel high quality seed, it’s usually sold by the bag/bushel at fairly modest prices, making it usuitable as a medium of exchange. Seed also spoils rapidly and can’t be stored.