re: #162 KGxvi

If we pegged dollars to gold, say $1 was equal to 1 oz of gold, then inflation and deflation would be wild because people buying and selling gold on the market would determine the value of a dollar. Moreover, if a foreign country (or alliance of countries) decided they wanted to fuck with us, they could sell their gold reserves and crash the dollar. Or, if a new gold vein was discovered in some area and extracted, that could effect the value of the dollar. Lastly, it sets up the potential for a run on the banks (a la the start of the depression) where people go to banks demanding the actual gold for their dollars on account.

We do not teach in schools what money really is.

Most people just equate money with currency, but the two are not the same. But the thought of it being a tangible substance with a value of its own somehow makes them think it is safer and less easily manipulated when that is far from the case.