For over 5,000 years, people have looked at one number to understand money:
The gold/silver ratio.
It seems simple.
How many ounces of silver equal one ounce of gold?
But behind this simple ratio lies a much deeper story—one that challenges how we think about money itself.
🏺 The Origins: Money Before “Money”
The earliest recorded version of the gold/silver ratio dates back to Ancient Egypt, around 3200 BCE.
At the time, the ratio was roughly:
2.5 : 1
Gold was abundant relative to silver in Egypt, and the ratio reflected local conditions—not some universal truth.
Already, we see something important:
Money was never neutral. It was shaped by power, geography, and institutions.
🏛️ Rome: When the State Sets the Ratio
Fast forward to 46 BCE.
Julius Caesar sets the ratio at:
11.5 : 1
This wasn’t a market outcome.
It was a political decision.
An attempt to stabilize monetary relations across the Roman economy.
And this raises a key question:
If rulers can set the ratio… is money really determined by nature?
📉 The Illusion of Stability
For centuries, people believed that the gold/silver ratio reflected a kind of natural order.
A stable anchor for value.
But history tells a different story.
The ratio has constantly shifted:
Driven by discoveries of new mines
Influenced by state policies
Reshaped by financial systems
And in modern times, it has become even more volatile.
📈 Modern Era: Instability Exposed
In 2020, during the COVID-19 crisis, the gold/silver ratio surged above:
120 : 1
A dramatic spike.
Not because the physical properties of gold or silver changed…
But because financial behavior changed.
Investors rushed into gold as a “safe haven.”
Silver lagged behind.
And the ratio exploded.
👉 Final Thought
For 5,000 years, we’ve been told that money begins with gold.
But the deeper you look, the clearer it becomes:
Money has never been about metals.
It has always been about systems.
📖 If you want to go deeper
I explore this in detail here:
Modern Monetary System in Theory and Practice: Who Creates Money?
