My best (stupid) guess is weapons. US gov has a ton of weapons. Already sells tons of weapons. Now the prices will always remain stable. Other countries would love to know that 30 million usd would always be able to buy an f15. Other countries declaring war will increase the value of the USD, as buying weapons from us government will decrease amount of money in circulation.
If you want a non-fiat currency, you want the backing thing to:
Not be easily produced/obtained, and to have a fairly predictable cost of production/obtaining.
Be fairly-rare, so that it can be value-dense, to reduce storage and transportation costs.
Not degrade.
Be hard to counterfeit.
It would be nice if it were divisible.
Not have much by way of critical non-backing uses, so that its use here doesn’t distort that.
Probably gold. It ticks pretty much all the boxes; there’s a reason that it was used in the past.
The big problem for me was something Ben Bernanke said: the process of taking gold out of a hole in the ground (a mine) just to put it into a different hole in the ground (a vault) is a pretty terrible waste of resources. And you need to continue mining it in order to stave off deflation, which means you have to keep doing that forever; and eventually that’s just not going to work anymore. Mining gold is only going to become more expensive as time goes on.
Not to mention, our economy is too big and moves too quickly for gold to be a moderating force to inflation anymore. The numbers are just too big and moving too fast; we need a more nimble lever, and right now interest rates are a pretty good one.
All of that to say, there’s a reason every country has come off of the gold standard since the mid- to late-20th century.
Because controlled inflation is necessary for an economy to function and nothing but a fiat currency has the desired characteristics.
Gold is still the best option if you insist on having the currency backed.
I mean we would use gold in electronics a lot more if it wasn’t considered valuable. So it’s not perfect because it actually has a wonderful use outside of being valuable.
Rather unlucky society picked gold and silver to he valuable with how useful they.
It could actually be a benefit if it does slowly degrade. Let’s support work, not hoarding.
That’s what inflation is and why governments target a low but positive level of inflation with monetary policies. The fact that your dollar slowly loses value pushes you to reinvest it. Very few rich people are just sitting on piles of cash.
If they didn’t also aggressively suppress increases to minimum wage and tax recapture benefits, I might agree, but in the long run inflation does more to devalue labor than it does to mitigate hoarding.