Commodity Money is a medium-of-exchange in which the units are fixed amounts, either by law or custom, of an actual commodity that has value other than as a medium-of-exchange. Most people falsely believe commodity money only means gold or silver money. Commodity money is any commodity that has been monetized by the passage of law. the supply of commodity money is tied directly to the production of that commodity by the people.

The most important principle of commodity money is the one least talked about. Commodity money can only be created by man's labor combined with the raw resources of the earth.

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