This process of privately issuing gold receipts became the basis for what is known today as banking. A bank became a repository for gold and issued bank notes which were redeemable in gold. And in the “good old days” a bank note was a promise to pay – a promise to pay a certain amount of gold (or silver) on demand.
Zimbabwe: Not that many years ago, the Zimbabwe dollar was trading at US $1.47. Last year, it had sunk to 100 TRILLION to the Dollar. A beautiful country which used to export grain to its neighbors now faces starvation. Imagine how a Zimbabwean family would feel, if they could lay claim to even one ounce of gold!
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cryptocurrency Naturally, gold is valued by comparison to various fiat currencies, primarily the US Dollar – and as such its value fluctuates day to day. Of recent times this fluctuation has been mostly up, as gold continues to increase in value, in comparison to the world’s paper currencies. This is another way of saying that fiat currencies are less trusted than gold. Gold is also the financial haven of last resort, for when the financial world starts to shake and jitter, people rush to gold. Why? Because they know that should paper currency plummet in value – even to zero – gold will hold its value.
But something is once again missing in the equation. In the manufacturing scenario we didn’t account for the time of the consumer because they were not the ones generating the product… we were. In a digital world the TOP (Time of Other People) would be generated by the CONSUMER as they entered their information in and create the product by hitting a button.
If we raise the cost $ (assuming enough value exists to justify it) we could make more money or if we increase the Value more people could justify spending $ thus also increasing the amount of money we could raise.