Henry,
>>You are not the first to mention that people in Southeast
Asia (and a few other locales) were better off holding gold than their own currencies. But they would have also
been better off holding soybeans and no one treats soybeans as money. And they would have been even better off if they held US dollars.<<
I think that a lot of people that look to gold as an alternative believe that virtually all currencies are being debased. So the fact that Aians would have been better off holding dollars, to them, is a temporary state of affairs. They hate the US dollar too. They are also a very cynical group when it comes to government statistics like the CPI. So they may not trust the apparent real returns on bonds. bills etc...
Gold, as opposed to other commodities, became money for some very specific reasons. It's easy to divide, lasts a long time, has fairly consistent quality, small amounts are worth large sums, it's almost universally desired etc... Anything can serve as money, but gold does the best job. Just to be clear, I'm not a gold bug. I'm just trying to explain some of the thinking.
Wayne
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