Because bartering for goods and services is too
constraining, something has to act as a currency. You can have two types
of currencies: - Fiat currency, which is simply an IOU, with no
collateral, or a commodity currency, which is an IOU with collateral.
In the latter currency, the commodity to be used must be
a universally accepted collateral, capable of being stored in Central
Banks, be of a singular grade, and be denominational.
Items like cattle, chickens, lumber, real estate, oil,
etc, come in different grades, aren't static, and wouldn't store at
Fort Knox. The only workable commodities are the precious metals like
gold and silver.