Friday, March 10, 2017

The precious metal part of gold

U can see why gold beats platinum or silver, the density, scarcity match fits well into the exchange society we have.  But in the model, we can add he factor thst specifies why precious metals work as exchange value.

Precious metal have a short supply chain, miner to money.  So precious metal are 'flea market' as I call it.  The actual perturbations caused by the transactions cost of the actual money are not subjecy to long supply chain fluctuations.  The cost of transport is fixed, linearly, fixed to weight and value. So precious metals always find a money niche, they are stable in supply chain and easily moved in the transport network.

Bit coin is the same, in a different niche. In the sandbox, deliveries are optimum, gold is moved more swiftly when is transport is continually priced, and the pits can do this.  So the sandbox does not mean gold is no longer king of the money metals, it is a better king.  Up, in the visible smart contract layer, the location of gold will be much more precise.

And he sandbox will suppor a variety of 'base money', the metals, the bitcoins, the buyers clubs, and retail controlled supply chains; all of whiuch make great base money in a multi-currency pricing sandbox.  They all offer a bound, managed congestion function, by virtue of the pits.

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