Why is the gold standard touted as being real money and fiat currency as fake?
A major difference is who controls the supply. The supply of gold is controlled by factors owned by a wide enough variety of unrelated people and companies that its roughly uncontrollable by any single entity and increases at a roughly predictable rate. This makes it popular among paranoids and s…
The Short Answer
A major difference is who controls the supply. The supply of gold is controlled by factors owned by a wide enough variety of unrelated people and companies that its roughly uncontrollable by any single entity and increases at a roughly predictable rate. This makes it popular among paranoids and small-government proponents. Additionally, this would theoretically give it more weight compared to fiat currencies controlled by less stable countries, who do not have the stability and size for their currency to be stable and valued as well. Of course, it's this very factor which makes it undesirable. The ability for a country to quickly shift its monetary supply in reaction to economic circumstances is very powerful, as can be seen the Depression and recently in Greece's case. There's also a psychological effect. Gold is perceived as more solid than a IOU from the government, however untrue that statement may be.
Analysis
Key Concepts: Supply, gold, controlled
This explanation focuses on supply, gold, controlled and spans 149 words across 8 sentences. At 107% above the average Society explanation (72 words), this is one of the more thorough answers in this category, reflecting the complexity of the underlying question.
What This Answer Covers
The explanation opens with: “A major difference is who controls the supply.” It then elaborates by presenting a contrasting perspective, ultimately building toward a complete picture across 8 connected points.
How This Compares in Society
Ranked #39 of 500 Society questions by answer depth (top 9%). This places it in the comprehensive tier — the top quarter of most thoroughly answered questions. Questions at this depth typically involve multi-faceted topics requiring nuanced explanation.
Frequently Asked Questions
Is there a simple explanation for why the gold standard touted as being real money and fiat currency as fake?
A major difference is who controls the supply. The supply of gold is controlled by factors owned by a wide enough variety of unrelated people and companies that its roughly uncontrollable by any single entity and increases at a roughly predictable…
How detailed is this explanation compared to similar Society questions?
This is one of the most thorough answer at 149 words, ranked #39 of 500 Society questions by depth. The key concepts covered are supply, gold, controlled.
What approach does this answer take to explain the gold standard touted as being real money and fiat curren?
The explanation uses contrasting perspectives across 149 words. It is categorized under Society and addresses the question through 1 analytical lens.