You may recall hearing that earlier this year, J.P. Morgan began to accept gold as collateral for some types of loans. The story can be found here. Here is an excerpt:"Gold hasn't reinvented itself as a currency yet. But it is getting closer."J.P. Morgan Chase & Co. said it will allow clients to use the metal as collateral in some transactions. For example, a hedge fund wanting to borrow money for a short period can put up gold as collateral and use the borrowings to invest elsewhere, betting on making a better return. Typically, banks accept only Treasury bonds and stocks in such agreements."By making the announcement, J.P. Morgan is effectively saying gold is as rock solid an investment as triple-A rated Treasuries, adding to a movement that places gold at the top tier of asset classes. It also is trying to capitalize on all the gold now owned by hedge funds and private investors that is sitting idle in warehouses."
Read the rest at MacroMania, Commodity money: It's back! (and it sucks)
Why does commodity money suck? Well, what happens when commodities tank?
(h/t Rob Parenteau via Yves Smith)
Tom, I think D Graeber has made a pretty good case towards the fact that use of "commodity money" is more or less from the traditions of ancient idolatry. Very dark and pagan...
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