# US gold coins as currency **URL:** \ **Category:** Factual Questions\ **Created:** [January 28, 2021, 12:45am UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657 "2021-01-28T00:45:45Z")\ **Posts on this page:** 20\ **Page:** 4
**Author:** ![dtilque](https://avatars.discourse-cdn.com/v4/letter/d/d6d6ee/32.png) [@dtilque](https://boards.straightdope.com/u/dtilque)\ **Post date:** [May 20, 2024, 4:34pm UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657/61 "2024-05-20T16:34:14Z")
> [@LurkMeister](#): > > Do they seriously think that the people with stocks of food, medicine, etc are going to want to trade their valuable commodities for pieces of yellow metal? A very good point. Going way back to the earliest use of gold as a medium of exchange, it only became that when there was a consistent demand for gold by people who used it for things. That is, the civilization was rich enough (i.e. had consistent surpluses of food and other things) that the king could afford to employ full time artisans who worked in gold. Thus people would always be willing to accept gold because they knew there was a market for gold. Before that, people might accept gold or they might not. The same thing will happen if society breaks down so much that there is no longer a consistent demand for gold for jewelry and decoration. ---
**Author:** ![Ynnad](https://avatars.discourse-cdn.com/v4/letter/y/4491bb/32.png) [@Ynnad](https://boards.straightdope.com/u/Ynnad)\ **Post date:** [May 20, 2024, 7:07pm UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657/62 "2024-05-20T19:07:09Z")
It appears that several posters in this thread want to categorize everything as simply being money or non-money. As usual, the real world is a bit more complicated. Maybe gold has some of he characteristics of money and some of the characteristics of non-money. Could this be an example of the logical fallacy of the excluded middle? ---
**Author:** ![FlikTheBlue](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/fliktheblue/32/10972_2.png) [@FlikTheBlue](https://boards.straightdope.com/u/FlikTheBlue)\ **Post date:** [May 20, 2024, 8:08pm UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657/63 "2024-05-20T20:08:20Z")
> [@LurkMeister](#): > > On the subject of gold as money: All these Preppers who hoard gold in anticipation of the forthcoming apocalypse, thinking that they’ll be able to buy whatever they need when paper money is worthless. Do they seriously think that the people with stocks of food, medicine, etc are going to want to trade their valuable commodities for pieces of yellow metal? Probably only if the person wanting to use the gold to buy food or medicine has something else that the person selling the food / medicine might want to buy at a later time. Maybe Mr. I Have Gold is a skilled carpenter, electrician, plumber, etc, and is willing to receive the gold back in exchange for providing services to the food and medicine seller at a future date. But in that case it merely becomes a medium of exchange again rather than having inherent value. ---
**Author:** ![DrDeth](https://avatars.discourse-cdn.com/v4/letter/d/b487fb/32.png) [@DrDeth](https://boards.straightdope.com/u/DrDeth)\ **Post date:** [May 20, 2024, 8:57pm UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657/64 "2024-05-20T20:57:57Z")
> [@mixdenny](#): > > You can if it is a Goldback. The Goldback is doing quite nicely in the 5 states that use it so far. Per Google- _Goldbacks are accepted at hundreds of businesses across Utah, New Hampshire, South Dakota, Nevada, and Wyoming. However, Goldbacks are not widely accepted as currency everywhere and are not recognized by the United States government. These states don’t call Goldbacks a legal currency, so they aren’t backed by any actual governments_ Three searches of “who accept Goldbacks” failed to come up with any names of business, just more ads for these “Goldbacks”. Note “hundreds” over 5 states- so the answer is no. > [@mixdenny](#): > > I think if you could walk into a store with small coins that held $5 or $10 worth of gold their acceptance would be very rapid. Nope. > [@Common\_Tater](#): > > Because they _outlawed_ it. Yes, for a brief time- _In America._ It is not used as money in any Western nation. No nation is on the gold standard. So yeah- one nation- out of about 200- made if briefly illegal. > [@Common\_Tater](#): > > They _outlawed_ gold, and confiscated all the coinage, that’s why it isn’t demanded for payment. Yes- in one nation, and no not all the gold was confiscated. People were allowed a modest amount and collectors could still keep theirs. > [@Common\_Tater](#): > > Central banks believe it is money. It trades on the currency desk, remember? Everybody else thinks it’s money. I mean, maybe you’re right, but that’s probably not the way to bet. No nations are on the gold standard. Gold is money as it is traded as a _commodity_ (Not currency)then so are hog bellies. ---
**Author:** ![mixdenny](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/mixdenny/32/2962_2.png) [@mixdenny](https://boards.straightdope.com/u/mixdenny)\ **Post date:** [May 21, 2024, 3:25am UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657/65 "2024-05-21T03:25:33Z")
OK. So gold is out. Even though we use it as currency all the time in my household (the wife loves gold jewelry as do all Thai ladies as far as I can tell). She does have to convert it to dollars or make a trade but that is second nature to her. But I’m a silver guy. In fact I am fondling some of my assets as I type. The gold/silver ratio was at a high earlier this month at about 90 to 1 and has been staying at 85-87. Many money people feel that silver is going to rise in value and this ratio will correct to…something lower. It is now falling at a rapid pace and is at 75 to 1. Do you think silver is any different then gold or are they both just precious metals? More information: I really collect silver because of my Grandson, the only boy amongst his 7 sisters. Like his grandpa he was a bit shy and introverted in high school. But he is a late bloomer and at 28 years old is doing great. He is a union carpenter doing mostly commercial drywall. He has his own nice little house. He saves money for the future. In addition to CDs he owns a bit of all the cryptos. Just small affordable amounts and he is in it for the long run, no juggling them around all the time. And he has a small silver collection. So I enjoy adding to my stash every month as I find cool new rounds and ingots to buy. When I croak he will have my pirates chest of bounty as a nice surprise. ---
**Author:** ![DrDeth](https://avatars.discourse-cdn.com/v4/letter/d/b487fb/32.png) [@DrDeth](https://boards.straightdope.com/u/DrDeth)\ **Post date:** [May 21, 2024, 3:28am UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657/66 "2024-05-21T03:28:34Z")
> [@mixdenny](#): > > Even though we use it as currency all the time in my household (the wife loves gold jewelry as do all Thai ladies as far as I can tell). Do I want to know what you are paying her for? 🤪 Gold is not money- certainly you can trade it- just like cattle. ---
**Author:** ![DaveUnknown](https://avatars.discourse-cdn.com/v4/letter/d/94ad74/32.png) [@DaveUnknown](https://boards.straightdope.com/u/DaveUnknown)\ **Post date:** [May 21, 2024, 3:38am UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657/67 "2024-05-21T03:38:02Z")
Gold is very pretty to look at, and probably rare in the universe, not too reactive, pretty well conductive, useful. But as they say, “you can’t eat gold & silver.” You can’t have a currency based on a finite supply of something borderline useless. Oil is more useful. (ETA oil being finite) ---
**Author:** ![Common\_Tater](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/common_tater/32/13846_2.png) [@Common\_Tater](https://boards.straightdope.com/u/Common_Tater)\ **Post date:** [May 21, 2024, 4:41pm UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657/68 "2024-05-21T16:41:56Z")
> [@OldGuy](#): > > The US did. Other nations did not in general. Soviet Union and Nazi Germany. I’ve no doubt there were others, either outright and defacto. Alan Greenspan wrote an excellent paper on this business. “Gold and Economic Freedom” explaining this. ---
**Author:** ![Common\_Tater](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/common_tater/32/13846_2.png) [@Common\_Tater](https://boards.straightdope.com/u/Common_Tater)\ **Post date:** [May 21, 2024, 4:49pm UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657/69 "2024-05-21T16:49:28Z")
> [@LurkMeister](#): > > Do they seriously think that the people with stocks of food, medicine, etc are going to want to trade their valuable commodities for pieces of yellow metal? I think you have it backwards here. Do you seriously think people with stocks of food and medicine would sell these items for a failed currency? This is the inherent problem. A currency only has value if the government that issues it is still around, or even expected to be around. The USD has long been “as good as gold” around the world, because the local currencies were not credible. I would sort of expect in any sort of societal collapse barter would be a big part of the daily grind. ---
**Author:** ![LurkMeister](https://avatars.discourse-cdn.com/v4/letter/l/3da27b/32.png) [@LurkMeister](https://boards.straightdope.com/u/LurkMeister)\ **Post date:** [May 21, 2024, 5:35pm UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657/70 "2024-05-21T17:35:47Z")
If you mean that people will still be relying on paper currency issued by a (presumably defunct) US government, no I don’t think that either. If the government collapses, I agree that we will default to a barter economy of some sort. People with skills may trade work for goods, and it is possible that gold may become a medium for the value of those skills as @FlikTheBlue suggested earlier. However, the gold itself will not have an inherent value. A piece of gold of a particular size may be used to designate 4 hours of carpentry work, for example. ---
**Author:** ![Schnitte](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/schnitte/32/9033_2.png) [@Schnitte](https://boards.straightdope.com/u/Schnitte)\ **Post date:** [May 21, 2024, 6:00pm UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657/71 "2024-05-21T18:00:25Z")
> [@Common\_Tater](#): > > Alan Greenspan wrote an excellent paper on this business. “Gold and Economic Freedom” explaining this. That article makes the point that governments abolished the gold standard to enable the expansion of money supply under a fiat system and indirectly confiscate people’s savings via inflation. That’s an opinion one might agree or disagree with, but either way it does not support the assertion that as things are today, gold is money. ---
**Author:** ![Common\_Tater](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/common_tater/32/13846_2.png) [@Common\_Tater](https://boards.straightdope.com/u/Common_Tater)\ **Post date:** [May 21, 2024, 6:15pm UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657/72 "2024-05-21T18:15:48Z")
> [@Schnitte](#): > > but either way it does not support the assertion that as things are today, gold is money. Of _course_ it is money. Cigarettes, even laundry detergent are used as money. Medium of exchange, store of value, etc. Why do central banks buy, hold, and sell hundreds of tons of it? Same reason they might buy and hold Yen or Dollars. I think the fallacy here, one I certainly hadn’t anticipated, is the notion that if it isn’t an officially government sanctioned legal tender, then it isn’t money. Gold coins are legal tender, though not one that anyone would wisely spend. A US $20 gold piece is certainly legal tender, though only a cretin would spend it at face value. I’d be one happy checkout clerk, I’ll tell you that. ---
**Author:** ![Schnitte](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/schnitte/32/9033_2.png) [@Schnitte](https://boards.straightdope.com/u/Schnitte)\ **Post date:** [May 21, 2024, 7:33pm UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657/73 "2024-05-21T19:33:14Z")
> [@Common\_Tater](#): > > Cigarettes, even laundry detergent are used as money. Medium of exchange, store of value, etc. Really? You’re using laundry detergent as a medium of exchange, store of value, and unit of account? Or, for that matter, gold? As in, say, your internet service provider quotes the price of your broadband connection in terms of so-and-so-many ounces of gold, or cigarettes, or gallons of laundry detergent, and will accept payment in that form? ---
**Author:** ![hajario](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/hajario/32/171_2.png) [@hajario](https://boards.straightdope.com/u/hajario)\ **Post date:** [May 21, 2024, 7:41pm UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657/74 "2024-05-21T19:41:03Z")
The unit of laundry detergent is a Pod. ---
**Author:** ![FlikTheBlue](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/fliktheblue/32/10972_2.png) [@FlikTheBlue](https://boards.straightdope.com/u/FlikTheBlue)\ **Post date:** [May 21, 2024, 8:09pm UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657/75 "2024-05-21T20:09:33Z")
> [@Common\_Tater](#): > > Of _course_ it is money. Cigarettes, even laundry detergent are used as money. **Medium of exchange, store of value** , etc. Why do central banks buy, hold, and sell hundreds of tons of it? Same reason they might buy and hold Yen or Dollars. > > I think the fallacy here, one I certainly hadn’t anticipated, is the notion that if it isn’t an officially government sanctioned legal tender, then it isn’t money. > > Gold coins are legal tender, though not one that anyone would wisely spend. A US $20 gold piece is certainly legal tender, though only a cretin would spend it at face value. I’d be one happy checkout clerk, I’ll tell you that. Maybe this is where some of the disagreements arise. A medium of exchange and a store of value are two completely different things. All that really matters for a medium of exchange is that the people using it agree on what it represents. It doesn’t have to be inherently valuable. It could be a a piece of green paper with a picture of Ben Franklin on it, or a sheet of regular notebook paper that says “I o u a steak dinner in exchange for you having helped me move a room full of heavy boxes”, or any other kind of token. The form of it doesn’t matter, and the inherent value of the token doesn’t matter. A store of value, on the other hand, is just that. It’s the actual item or service that you value. It’s not a piece of paper saying someone owes you a steak dinner. It’s the actual steak dinner, or container of laundry detergent, or carton of cigarettes, or whatever. The problem with stores of value is that not everyone values the same thing. If I’m not a smoker, what do I want with a carton of cigarettes? A medium of exchange, however, can be used for anything, as long as we agree on how much value a given unit can be exchanged for. That’s what money is. It’s a way of keeping track of how much you owe or are owed. ---
**Author:** ![Common\_Tater](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/common_tater/32/13846_2.png) [@Common\_Tater](https://boards.straightdope.com/u/Common_Tater)\ **Post date:** [May 21, 2024, 8:35pm UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657/76 "2024-05-21T20:35:22Z")
_A medium of exchange and a store of value are two completely different things_ Of course they are different things. I’m not sure what your point is. That doesn’t explain why someone would suggest _gold isn’t money_, despite it having all the attributes of money. Gold was used as money precisely because not everyone wants the same things. (Even if you aren’t a smoker, tobacco was a very desirable asset to hold for trading for the things you want.) Aristotle laid this out two thousand years ago. (It really is taking longer than we thought!) - Durable: Money must stand the test of time. It must not fade, corrode, or change through time; - Portable: Good money needs to hold a high amount of ‘worth’ relative to its weight and size; - Divisible: Money should be relatively easy to separate and re-combine without affecting its fundamental characteristics. An extension of this idea is that the item should be “fungible”, defined as “being freely exchangeable or replaceable, in whole or in part, for another of like nature or kind.” - Intrinsically Valuable: This value of money should be independent of any other object and contained in the money itself, starting with rarity. Aircrew survival kits in the US .mil used to contain gold coins, as a means of potential payment when evading the enemy. That’s a hallmark I think, of a “universal currency”, it is readily acceptable anywhere in the world. US dollars come close, Swiss francs did at one time. ---
**Author:** ![mixdenny](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/mixdenny/32/2962_2.png) [@mixdenny](https://boards.straightdope.com/u/mixdenny)\ **Post date:** [May 21, 2024, 8:40pm UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657/77 "2024-05-21T20:40:00Z")
> [@hajario](#): > > The unit of laundry detergent is a Pod I like it. How many pods for a cup of softener? ---
**Author:** ![DrDeth](https://avatars.discourse-cdn.com/v4/letter/d/b487fb/32.png) [@DrDeth](https://boards.straightdope.com/u/DrDeth)\ **Post date:** [May 21, 2024, 8:54pm UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657/78 "2024-05-21T20:54:58Z")
> [@Common\_Tater](#): > > I’ve no doubt there were others, either outright and defacto. Yeah, the UK tried it in 1966- dumped it in 1970. And bring in two nations with no personal liberties doesnt help your case. > [@LurkMeister](#): > > If you mean that people will still be relying on paper currency issued by a (presumably defunct) US government, no I don’t think that either. If the government collapses, I agree that we will default to a barter economy of some sort Yep, Ammo and canned goods. the .22 round is change, etc. > [@Common\_Tater](#): > > Gold coins are legal tender, though not one that anyone would wisely spend. No. Only US minted gold coins with a face value in dollars are. You can’t buy groceries here with a krugerrand. And you’d give up a $1100 coin to get $20 of stuff. > [@Common\_Tater](#): > > That doesn’t explain why someone would suggest _gold isn’t money_, despite it having all the attributes of money. Is it Legal tender? (except in us Gold coins with a face dollar value) No. Can you buy groceries with it? No. Can you pay your taxes with it (excepting the idiot idea of paying with us gold coins at a 500th or their value)? No. Then it lacks the three most important characteristics of “money”. > [@Common\_Tater](#): > > Aristotle laid this out two thousand years ago. I cant find those quotes- cite? And in any case- > [@Common\_Tater](#): > > Durable: Money must stand the test of time. It must not fade, corrode, or change through time; Athenian coins were silver- which most certainly can corrode. ---
**Author:** ![Common\_Tater](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/common_tater/32/13846_2.png) [@Common\_Tater](https://boards.straightdope.com/u/Common_Tater)\ **Post date:** [May 21, 2024, 10:01pm UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657/79 "2024-05-21T22:01:12Z")
> [@DrDeth](#): > > And bring in two nations with no personal liberties doesnt help your case. What? LOL OK, sure … go with that. Good Lord. Obviously, foreign coinage was never legal tender in the United States\*. If I’d said that, maybe you’d have a point. There’s no reason to get pedantic. Everybody knows what is understood here. Good try, though. To your mistaken point though, it should be pointed out that many different countries in Europe issued identical gold coinage (in terms of content, weight, and fineness) and these traded freely. Nobody in France or Italy or Britain cared whose visage was on the coin itself, because the coinage was for all practical purposes identical. It had value _regardless of the entity that issued it_. In fact they still have value, even though the governments are long gone. See where i’m goin’ with that? That’s why it is ridiculous in the extreme to claim “Gold Isn’t Money”. So that leads me to wonder out loud - Is a worthless paper currency issued from a long ago failed state, is that money?? It can’t purchase anything. Is it only the official government _imprimatur_ that determines whether something is money? - I better allow that Spanish silver dollars were legal tender in America before the various mines and mints were setup. I don’t need any more nitpicks. ---
**Author:** ![DrDeth](https://avatars.discourse-cdn.com/v4/letter/d/b487fb/32.png) [@DrDeth](https://boards.straightdope.com/u/DrDeth)\ **Post date:** [May 21, 2024, 10:10pm UTC](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657/80 "2024-05-21T22:10:52Z")
> [@Common\_Tater](#): > > What? LOL Basing your point on two of the most extreme dictatorships in history means- you have no point. They didnt allow most books either. > [@Common\_Tater](#): > > Obviously, foreign coinage was never legal tender in the United States\*. Yes, so “gold coins are not legal tender”. Us coins are legal tender- at their face value only. > [@Common\_Tater](#): > > To your mistaken point though, it should be pointed out that many different countries in Europe issued identical gold coinage (in terms of content, weight, and fineness) and these traded freely. Yes, because back then the value of gold didnt fluctuate wildly. > [@Common\_Tater](#): > > Is it only the official government _imprimatur_ that determines whether something is money? Yep. [Previous page](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657.md?page=3) [Next page](https://boards.straightdope.com/t/us-gold-coins-as-currency/931657.md?page=5)