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Suppose King Midas learns to turn off his power to turn things into gold, and passes on that ability to his children.

A few centuries later, King Midas has thousands of descendants, all of whom can turn things into gold by touching them, and all of whom can turn this power off when they want to.

Specifically, when a descendant of Midas uses their power, the object they touch gains mass to become solid gold. (Air particles only turn into a thin, flaky golden film on the hand when the power is used, and they can't convert more than a few cubic meters in one shot. There is no danger of turning the entire earth to gold or similar disasters.)

What happens to gold economically? Do people start building houses out of the stuff? how does this affect technological and economic development? What uses are there for gold when it becomes incredibly cheap?

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    $\begingroup$ "What happens to gold economically?" let me introduce you to the richest person to ever live: Mansa Musa, ruler of Mali. His realm was exceptionally wealthy due to many gold and salt mines. He was also devout Muslim and made his Hajj (religious pilgrimage for Muslims) to Mecca. He gave away so much gold while there that he crashed the economy for the next 10 years. So, start there and imagine even worse economic results. $\endgroup$ – VLAZ Mar 29 at 11:34
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    $\begingroup$ First and foremost, such a power would be weaponized and the wielder would likely be killed/detained by enemies or the government. Additionally, Goldar from en.wikipedia.org/wiki/Power_Rangers_(film) would cease to be an interesting villain since you may as well have made them from dirt. If King Midas decided to be an a$$ and start turning all food into gold then people would be quick to send him to the guillotine where the final splash of blood would turn onlookers into solid gold. As for its value, yes it will absolutely plummet. $\endgroup$ – MonkeyZeus Mar 29 at 15:03
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    $\begingroup$ FANTASTIC idea - I explain why in an answer $\endgroup$ – Fattie Mar 29 at 15:48
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    $\begingroup$ Relevant Kurzgesagt video: youtube.com/watch?v=VB_GWz25B3Q $\endgroup$ – nick012000 Mar 30 at 3:08
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Gold would then be completely unsuitable for use as the basis of any currency. It would just be another material with certain physical properties.

Assuming the world society survived the screaming madness that occur in the years following the discovery that all their money is, well, not money...

The good:

  • Gold is a very inert metal. It does not rust, it does not tarnish, it does not corrode even in the presence of some really nasty chemicals. You must concoct some really mean acids to even get it to admit that acids exist. This also means it simply does not form organic compounds, and is thus not at all a heavy-metal toxic danger, in any natural form.
  • Gold has very good electrical conductivity. Almost as good as copper.
  • Gold has a quite distinctive appearance. A very loud appearance, it positively screams "Gold is Here!"
  • Gold is ridiculously dense, almost twice as dense as lead. Being cheaper than lead, and immensely less toxic, it would be handy for counterweights, keels, barbells, etc.

The bad:

  • Gold is ridiculously soft, and completely unsuitable for use as a construction metal without alloying it with something to beef it up.
  • Gold is ridiculously dense. Yes, this belongs in this column too!
  • Gold has a quite distinctive appearance. A very loud appearance, it positively screams "Gold is Here!". Yes, this to belongs in the 'bad' column too.

So, everyone (or at least a great many people) can create gold at whim. None can UN-create the stuff. This positively designates it as a waste material. No matter what happens, eventually we will have too much of the stuff.
It will be all over the place! And it has such a distinctive appearance!
I can just see how property prices can be devalued by having too much gold contamination in the area. "Nice house, good access to schools, but the neighborhood is 7% gold. No thank you, we'll look elsewhere"

It can be dangerous!
What if some insane Midas-person converts just the root of an airplane wing to gold? Or converts the steel support beam of a building, or bridge? Or how about just converting 1 cubic meter of that there nuclear reactor pressure vessel to gold? And are those realistic statues, or did the maniac really convert a whole kindergarten full of kids into golden garden gnomes?

I expect that the "Midas Wars" will be a brief and bitter fight to the death, leaving large tracts of the landscape littered with golden debris, before the Midas Curse becomes just another footnote in history. A cautionary tale of powers that mankind Should Not Have.

Or possibly:
Maybe the last few remaining Midas-persons will become valuable commodities, to be used under guard and operating under the strictest of supervision in a (already golden) prison-like environment. After all, it would be handy to have someone on hand that can instantly convert toxic waste, even radioactive waste, into harmless gold at a touch.
And if the toxins and radioactivity harms them, so what. They are not real humans, they are just Midas-people. The same demons that tried (and very nearly succeeded) to destroy the world economy with their depraved ways. Billions starved before they were stopped, and they deserve whatever happens to them now.

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For a start it stops being valuable.

If we fast forward past the initial few generations (such that thanks to his descendants gold is now ubiquitous) & the economic upheaval of crashing the worlds gold economy & destroying its value as a medium of exchange you will simply find yourself with a world where it's used for everything lead was, non toxic gold water pipes, roofing material etc,

You've set this in a pre-tech society & a few hundred years doesn't change that in the real world.

So there are no new technology applications here it merely replaces lead.

Which is good, a lot less lead poisoning all around because your using it in place of lead water pipes.

But that's really about the only major difference I can see it making.

That & silver is now the king of coins.

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    $\begingroup$ Tech note: gold is quite capable of being a toxic heavy metal, even though its mostly inert...... $\endgroup$ – Stilez Mar 29 at 20:23
  • $\begingroup$ Gold pipes! How did I not think of that! Gold roofs. Gold ship bottoms. Yes: gold is the new and much less toxic lead. There might still be gold coins: gold plated corrosion-proof iron. $\endgroup$ – Willk Mar 31 at 1:24
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It could be like OPEC?

If this actually happened,

  • the people with the "golden touch" would not be idiots...

  • obviously if you make too much, as everyone has mentioned the price of gold would simply plummet.

But.

Assume for a moment that every single person with the gold touch, keeps together in a tight, tightly controlled clique with NO splitters.

As you can see - they are now SET. They would have an amazing amount of power and wealth.

A rich vein (sorry! :) ) for plots...

BUT. As you can also see, you immediately have a prisoner's dilemma game theory situation.

What happens if one gets greedy and (somehow) escapes and makes gold freely for her own use?

What happens if two competing sects - but, they have to diplomatically balance not producing too much.

Surely, the gold-making sect (or sects) would build up massive military power to protect themselves.

Surely, the gold-making sect (or sects) would build up tremendous "cultural traps" to keep members in line - just as with power-wielding sects in today's world - but more so!

You're on a plot winner there!

A great read ...

Everyone should read

https://www.amazon.com/Evolution-Cooperation-Revised-Robert-Axelrod/dp/0465005640

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    $\begingroup$ "...the people with the "golden touch" would not be idiots..." - are you taking bets? $\endgroup$ – Bob Jarvis - Reinstate Monica Mar 30 at 23:46
  • $\begingroup$ @BobJarvis-ReinstateMonica - lol on that ! But like I suggest, that is history / the story. The history of OPEC, which is just what is under discussion here, is fascinating stuff!! For the Prisoner's Dilemma, there are many super books such as amazon.com/Prisoners-Dilemma-Neumann-Theory-Puzzle/dp/… $\endgroup$ – Fattie Mar 31 at 0:01
  • $\begingroup$ the original and most famous one bveing amazon.com/Evolution-Cooperation-Revised-Robert-Axelrod/dp/… $\endgroup$ – Fattie Mar 31 at 0:01
  • $\begingroup$ OPEC produces a consumable, though... $\endgroup$ – I'm with Monica Mar 31 at 11:38
  • $\begingroup$ hi @I'mwithMonica ! -- sure, but there are any number of "cartel" examples, for example diamonds $\endgroup$ – Fattie Mar 31 at 11:41
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I think you are grossly underestimating the amount of gold on Earth.

According to this source

Warren Buffett, one of the world's richest investors, says the total amount of gold in the world - the gold above ground, that is - could fit into a cube with sides of just 20m (67ft)

But not everyone agrees with the GFMS figures.

Estimates range from 155,244 tonnes, marginally less than the GFMS figure, to about 16 times that amount - 2.5 million tonnes.

That bigger figure would make a cube of sides 50m (166ft) long

According to those estimates we have something in the range of 8000 to 125000 cubic meters of gold.

The fact that Midas and his descendants can stop the power at will makes no big difference. If "goldy training" a baby takes the same amount of times (and failures) it takes for potty training, I guess that any baby would accidentally produce a few hundreds of cubic meter of gold just in their young age. Plus all the amount willingly produced, it's easy to see that the use of gold as value storage would simply vanish.

For a reference, look at aluminum: in the beginning it was so rare that rivaled with gold in term of preciousness, and statues were made out of it as a display of wealth (the one in Piccadilly Circus, for example), while nowadays we wrap food in it and throw it away. Probably it would happen the same with gold, with the added twist that gold can be eaten, so nobody would have to worry about unwrapping their bun.

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    $\begingroup$ Can I have some mustard on my wrap please? The taste of gold is making my hot-dog dull. $\endgroup$ – Clockwork Mar 29 at 16:22
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    $\begingroup$ Actually, there's enough gold in the core of the earth to plate the surface to a depth of more than 10 feet thick. And by "surface", I include the ocean bottoms, too. $\endgroup$ – WhatRoughBeast Mar 29 at 17:17
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    $\begingroup$ It probably makes sense to have the power only appear when they reach puberty or something. Babies with any one of a number of supernatural abilities would be quite hard to raise. $\endgroup$ – NotThatGuy Mar 29 at 17:19
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    $\begingroup$ Part of the point of wrapping food (particularly if we're talking about freshly prepared food, which you seem to be doing) is to keep the parts you want to eat separate from the parts that's exposed to stuff you don't want to eat. So... you're probably not going to eat the wrapper. Unless you wash it first, but then, you probably don't want to eat it anyway. $\endgroup$ – Matthew Mar 29 at 17:59
  • $\begingroup$ @NotThatGuy I too have seen The Incredibles 2 $\endgroup$ – Michael Mar 30 at 18:05
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Gold would lose it's value completely.

Or not.

If this family keeps its act together, they will hoard all of the gold they produce, releasing it slowly to control the supply to match the demand.

The De Beers group has done this admirably with diamonds. These gems are really very plentiful. More than enough to go around. They are minded in huge operations. However, the De Beers empire has monopolized the entire process, and very carefully control how many gem-grade diamonds are released into circulation.

From its inception in 1888 until the start of the 21st century, De Beers controlled 80% to 85% of rough diamond distribution and was considered a monopoly.[4] Competition has since dismantled the complete monopoly, though the De Beers Group still sells approximately 29.5% of the world's rough diamond production by value through its global sightholder and auction sales businesses, an effective monopoly, as this still allows it to control prices, inflating them dramatically.

I suspect the Midas monopoly would do much of the same, very carefully controlling the price of their source of wealth and power. Fort Knox, of course, would look like a miniscule operation compared to their storage vaults, however.

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    $\begingroup$ I would not use the word "admirable" to describe DeBeers' practices... $\endgroup$ – Michael Mar 30 at 18:04
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    $\begingroup$ I agree and am in fact willing to make the statement that child slavery, really any form of slavery period is abominable, but especially child slavery(really really bad) in some extremely dangerous, fatal working conditions(even worse). $\endgroup$ – Madman Mar 31 at 0:53
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They are quite valuable.

9000 descendants making 3 cubic meters of gold every 5 seconds for a 10-hour shift gets you:

$9000 uw \times \frac{3 \frac{m^2}{uw}}{5 s} \times \frac{60 s}{1 min} \times \frac{60 min}{1 hr} \times \frac{10 hr}{day}$

...which is 194.4 million cubic meters per day, or, in gas mining terms, 6,865 MMSCFD. So this is somewhere around Indonesia's current gas production by volume, caveats being that it's a bit harder to move, you can't use it by burning it, and you can't release it to the stratosphere if you want to get rid of it. But it doesn't go boom or cause global warming.

Gold is $19.30 \frac{g}{cm^3}$ or $19,300 \frac{kg}{m^3}$, so this is 3.75 trillion kilograms per day or 3.75 billion (metric) tonnes of metal output. That is actually around double the global steel output for a year. True, the increased weight doesn't help very often (forklift counterweights, elevators, ballast) and more often the benefit will be half or less. Gold is, as some say, flimsier than steel. But it is still METAL.

What would you do with it? Well, if gold can make thrones and crowns, it can make office furniture and computer casings. It replaces copper wire wherever copper wire is still used, and copper pipes, even PVC. Steel fences are replaced by weaker but heavier posts of gold. Shipbuilders deplore the flimsy metal but promote its corrosion resistance. Perhaps they keep a steel framework inside it. Wherever crummy screwdrivers and unreliable bolts are sold, the "white metal" made from zinc gives way to a gold and nickel blend. (At least it doesn't just snap - you can beat it back into shape)

Rolled out into leaf, gold takes over for aluminum and even some plastics for food packaging. Cast into bricks, it makes for an attractive, durable paving stone wherever a brick road will do, though I think brick works out to be too cheap per cubic meter to take on directly.

Steel was trading at \$711/tonne in a random web hit. Suppose gold is only worth a tenth of that, seven pennies per kilogram, taking on PVC and plastics and even upscale paving bricks. So that's $\frac{711}{10} \times 3752$ million tonnes daily, or \$266 billion a day. Talk about the wealth of Croesus! The present total gold value is reputedly \$9 trillion (random web site), so you can surpass that in a month or so. It is a pity that the Midas mutants are too dangerous to leave running around loose ... but they contribute mightily to the gross national product right where they are.

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    $\begingroup$ Gold will probably not generally replace wood; it's not that much more durable to be worth the extra weight in most circumstances. Actually, I expect one of the initially popular uses to be making paper. Or something that serves a similar purpose. Part of the problem with converting stuff into gold on a mass scale is the raw material. Many goods won't actually benefit from being turned to gold, so you're going to mostly be converting rocks... and plant matter. The latter may lead to mass production of gold sheeting. $\endgroup$ – Matthew Mar 29 at 18:36
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    $\begingroup$ To make the gold you wouldn't start with rocks or plant matter. Nay, the proper place for a gulag is in the high Arctic, where the Midas mutants can convert ice on the assembly line. Mold the ice or carve it from icebergs in moderately convenient shapes, then run it through the line,to be loaded aboard large, flimsy ships of gold. $\endgroup$ – Mike Serfas Mar 29 at 23:55
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The accepted answer is provably false because the situation described in the question is exactly analogous to the current situation involving the role of central banks and quantitative easing.

In short, economies around the world became dependent on private credit, which was directly synthesised by banks. When the system breaks down, the government steps in to replace the flow of new private credit with central bank and government money, through various mechanisms. They synthesise new money and drop into the economy through various channels, so the private sector can continue to borrow and pay off old debt.

Once this state of affairs arises it is practically inescapable. Japan has been stuck in this pattern since their crash in the 90s and the West lives in a state managed economy since the financial crisis of 2007.

In the Midas situation the same set of circumstances might have already arisen. And the growing abundance of gold would have simply allowed commercial banks to issue more paper money. It is not necessarily the case that would have caused inflation, it depends on economic circumstances. If we assume a free market economy where banks issue synthetic debt money, and where gold backing played no role in international settlement of trade imbalances, the inevitable economic outcome would be the same as in our world today. Gold synthesis is analogous to the eternal money synthesis central banks and governments are now compelled to fulfill. The difference is that digital money created in QE is generated in such vast quantities that gold production by a few thousand individuals would be insufficient. The relative value of gold as central bank money even when being created like that would be quite high.

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  • $\begingroup$ This answer assumes that the Midas people can be compelled to act in the interests of monetary politics. Central banks don't create money on a whim. They carefully decide how much money they create and how to spread it. $\endgroup$ – Philipp Mar 31 at 8:50
  • $\begingroup$ Philipp - it wouldn't matter, and that's not quite accurate either. Random spending : no difference between the helicopter drop (eg: covid stimulus cheques) and the actions of the 'wandering money fountains'. Even if all they did was spend their gold on prostitutes, it would then be prostitutes who put economic stimulus into effect. What shape the economy takes, i.e. which class or segment of the population becomes predominant as a result, is largely irrelevant. The careful choices of monetary politics you refer to are only careful choices right now to preserve a certain elite. $\endgroup$ – Frank Mar 31 at 9:22
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The economy will crash. The situation is different from aluminium as back when aluminium was extremely expensive, it was not used for financial storage, i.e. it wasn't a part of our currency or financial property, whereas gold is a major contributor. But if they keep their production under control, the MIDAS Group could become THE richest and most powerful dynasty on Earth. Technological uses are aplenty. You could use gold in alloys, circuitry, contact electronics, conducting materials, special glasses etc. A major application would be gold leaf usage. Thin gold leaf production and gold plating could flourish providing huge scientific and economic applications. You could probably have a great time converting waste from dumpyards and processing plants and ... anywhere, really, into gold. Also, radioactive waste, and biohazardous material could be converted to gold too. A thing to ponder is if you could introduce a genetic condition, through which you did not convert an object to gold, but produced an equivalent weight in gold. For example you could convert 19.3 Kg of plastic to a cubic meter of gold, which would be really easy to transport.

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