Why Does Gold Back Global Currencies, and Not, Say, Argon?

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Nov. 10 2011 12:06 PM

Why Gold? Why Not Argon?

How gold was picked from all the elements to back global currencies.

Gold bars
Gold bars

iStock photo via Thinkstock

Gold has historically been the backbone of currencies around the world.* But why exactly is that? There are 118 chemical elements in the periodic table that might have been chosen, but gold got the nod.

David Kestenbaum and Jacob Goldstein from NPR’s Planet Money explain the rationale for settling on gold in the video below, the latest in a series about economic issues produced in collaboration with Slate’s video team.

Correction, Nov. 10, 2011: The introductory text above originally implied that gold is still widely used to back currency, which is inaccurate. While many countries hold gold in reserve, the U.S. dollar, for example, has not been tied to gold since the 1970s.