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I'd like to see a poll of average citizens to see how many of them know what a fiat currency is. I've asked dozens of my friends and none of them have ever heard of the term. It's amazing when you think about it. We use it every day but no one knows what it is. I expect that to change when the dollar crashes.
It is the single most important term for anyone who loves liberty to know.
Murray Rothbard does a great job explaining the difference between sound money and fiat currency in "The Mystery of Banking"
Yeah, this: http://en.wikipedia.org/wiki/United_States_Notes
Depending on the semantics or how you define it, Federal Reserve Notes are technically not fiat currency, because they're not actually issued by the state but rather by a private central bank with a government-decreed monopoly (i.e., the Federal Reserve Bank); they get their value from being debt-based rather than from state decree.
I'm not sure if plain fiat money, as in the type with the red seal shown in the image, is a bad idea in itself, but I don't care for some private central bank having a monopoly on issuing currency. Even if I was ok with that - still, I'd rather they get a small one-time issue fee rather than being interest-bearing usury based.
Federal Reserve Notes are more like fiat monopoly debt-interest currency.
I know you said "depending on the semantics or how you define it", but the question of what determines fiat currency is not limited to the source of issuance. Even if it was, the Fed's fiat currency is very much 'issued' by the state, given that Congress is the source of the Fed, which is in turn the source of the currency. There are no degrees of separation, and while the Federal Reserve may be privately controlled, it is nonetheless not privately 'owned'. The Fed is a Creature of The State, its charter having come from an act of Congress (regardless of its constitutionality or lack thereof), with the state ultimately responsible for its every move, including every move the state makes as it enforces that creature's monopoly.Quote:
Originally Posted by Neil Desmond
If Congress repealed all legal tender laws (nobody is forced to accept a given currency as payment for private debts, nor required to acquire it for payment of public debts), the Fed could continue its counterfeiting, but its notes would no longer be considered "fiat", because everyone would have the option of accepting them or acquiring them as they chose.
Even hard specie, gold and/or silver coin, could be considered fiat money. If a government declares anything legal tender (i.e., you are forced to accept it as payment of debts or else forfeit any legal claim for payment), that currency is fiat currency. Likewise if the basis upon which that legal tender derives its value is initiated, sanctioned, or enforced by government decree.
The mere declaration of exchange value under the Coinage Acts (by government "fiat"), which put us on a de facto gold or silver standard at various times (depending on whichever was overvalued at the time) made the overvalued specie a form of fiat money. That is because a) it was legal tender, and b) its value was declared, sanctioned, or enforced by government decree.
Well , I am just an old Country Boy trying to get by, but , that paper money is worth , what ?? Jackshitfuckingshit .
I have a billion zimbabwe dollars. Do you know what I can buy with a billion zimbabwe dollars? A pair of cheap shoes, if Im lucky.
Anything can be considered fiat.
How is the "Silver Dollar" ... 371.25 grains of pure silver considered fiat?Quote:
Originally Posted by Machiavelli
If the government declares (by fiat) that it must be accepted as legal tender then technically it would be fiat currency. That doesn't mean it would behave like paper fiat currencies do.Quote:
Originally Posted by Travlyr
yeah exactly.Quote:
Originally Posted by The Gold Standard
While gold and silver historically have been the best form of sound money and will continue to do be, if any form of money is state controlled it is fiat. The metal value can be lower then the face value in which the government declares as legal tender. Of course this would not occur in a free market/banking economy, as competing currencies would regulate the issuing of money and its value.
Gresham's Law would never have been invoked in the US if Congress had never attempted to declare an actual exchange value ratio for gold and silver (and also nickel and copper, given their "small change" fiat status).
There is no exchange value mathematical constant for silver as small change for gold, or copper and nickel as small change for gold or silver. They are forever in a state of natural flux in terms of real exchange value which is neither determined nor controlled by any single entity.
The 'de facto standard' established by the so-called "Bimetallic" standard insanity, was tantamount to an artificial control that virtually guaranteed an on-going natural scarcity of hard specie, as only the most overvalued specie would always dominate circulation, with the undervalued specie hoarded at any given time -- and for that reason only. If there was no state declaration of value, market value determinations would prevail, and exchange values would adjust naturally, leaving no reason for anyone to hoard. Whether intended by Hamilton (or whomever advised him) or not, the net effect was centralization, or a de facto monopoly of specie in terms of TYPE.
Anytime government is involved in exchange value determinations of any kind, the market is distorted by a system that is inherently corrupt. If Congress had simply allowed all different specie to float against one another in free circulation (as the separate currencies they are anyway), with exchange values established by the free market only (as it does anyway, regardless of any state decrees), NEITHER could have driven the other out of circulation. The irony here is that this would have naturally addressed the so-called "money supply problem" (assuming no paper derivatives, or promises to pay, are declared legal tender). With gold AND silver circulating and competing--naturally and simultaneously--the overall quantity of currency in circulation is automatically greater by that amount. The more the merrier.
If gold, silver, copper, nickel, platinum or any other commodity used as a medium of exchange are allowed to circulate freely, and float freely against one another, EACH would serve as a natural check and balance against artificial controls on all other currencies in general. It would tend to stabilizing prices ON EVERYTHING, all goods and services, because you really are measuring exchange values of goods and services against a "basket of specie" that cannot be centralized, or put into anyone's control basket.
Media of exchange are the lenses that reveal market exchange values of all unlike things--goods and services. One specie, one currency, one lens, is MYOPIC, and subject to every kind of distortion. The more lenses you have, the less distortion is possible. Let someone mess with gold, or let there be a new silver boom, and the market will respond, correct and adjust very quickly, because the new quantity brought into circulation will be revealed just as quickly, and felt by everything else, in a MANY-TO-MANY relationship, and not a ONE-TO-MANY relationship that distorts all other exchange values in the process.
And this makes Jack Chick all the more ridiculous: there actually was something wrong with D&D, and he missed it.Quote:
Originally Posted by Steven Douglas
Understanding this ^^^ is how to achieve the liberty so desperately desired by many.Quote:
Originally Posted by Steven Douglas
Good point. Bimetallism is really Trimetallism. In the Coinage Act of 1792, Alexander Hamilton set the price of gold to the price of silver to the price of copper. Although the Constitution did not allow for price fixing, the Nationalist loving Hamilton set out to subvert the Constitution right off the bat because the Nationalists did not get their way in the Constitution or the ratifying process. Some people claim that Alexander Hamilton was an agent of the London based Rothschild Banking House ... I suspect he was because he argued for a Central Bank even though it was unconstitutional.
Then 'grains', 'standard gold', 'standard silver', and 'penny-weights' should have been clearly defined in the Act so that debasement of currency was easy to detect.Quote:
EAGLES--each to be of he value of ten dollars or units, and to contain two hundred and forty-seven grains and four eighths of a grain of pure, or two hundred and seventy grains of standard gold.
Should read: EAGLES--each to be of he value of ten dollars or units, andto contain two hundred and forty-seven grains and four eighths of a grain of pure, or two hundred and seventy grains of standard gold.
DOLLARS OR UNITS--each to be of the value of a Spanish milled dollar as the same is now current, and to contain three hundred and seventy-one grains and four sixteenth parts of a grain of pure, or four hundred and sixteen grains of standard silver.
Should read: DOLLARS OR UNITS--each to be of the value of a Spanish milled dollar as the same is now current, andto contain three hundred and seventy-one grains and four sixteenth parts of a grain of pure, or four hundred and sixteen grains of standard silver.
CENTS--each to be of the value of the one hundredth part of a dollar, and to contain eleven penny-weights of copper.
Should read: CENTS--each to be of the value of the one hundredth part of a dollar, andto contain eleven penny-weights of copper.
Sound Money: Commodities. All available productive land, water, and mineral rights are owned by individuals. Sound money is mined, grown, or sewn and become valuable through honest efforts of producers. Gold, silver, oil, and other resources are mined and have real value. Grains, livestock, cotton, linen, hemp, etc. are all grown and have real value. Cars, electronics, houses, clothes, toys, etc. are all sewn and have real value. Paper money is 100% redeemable. For example, an Eagle paper gold certificate can be exchanged for a pure gold Eagle and vice versa.
So, in a system of sound money inflation is regulated by producers. The laws of supply and demand apply for goods and services with money as simply another valuable commodity. If a manufacturer builds too many cars, or there are too many car manufacturers, then they "inflated" society with more cars than needed so the value of cars go down. The same with gold, oil, food, electronics, etc. Inflation is controlled by natural occurrences, efforts of work, and honest exchanges. Sound money creates a self-regulating free-market. If taxes are too high, then simply stop paying them. Sound money transactions are untraceable. Individuals control the money supply and therefore create a self-regulating free society.
Unsound Currency: Counterfeit. Fiat money is "created" out of nothing. So it really is not money. Irredeemable fiat paper currency is simply a claim on money. Those claims are forced onto society through force of "law" and threat of violence. Obey & pay to play or go to jail. Since fiat currency is unconstitutional it is not really force of law but force by indoctrination and thugs with guns. Counterfeiting pays big bucks.
Fiat money inflation is completely controlled by the banking industry. The more currency they "create" the more inflation they cause. The faster they inflate their currency the faster the value of their currency goes down and the price of goods & services go up. The laws of supply and demand operate differently than in a sound money environment because the money supply is manipulated rather than mined, grown, or sewn by producers. If taxes are too high, there is nothing you can do. All transactions are carefully tracked and reported. You could try and not pay the taxes, but either they will throw you in prison or just print their way to wealth at your expense. Privileged people control the money supply and therefore create a tryannical police state society where wealthy elite control the means of production.
How many people know? A lot more than five years ago, thanks entirely to us.
Well, not entirely. The recent ridiculous rates of inflation have definitely made the audience more interested and attentive.
Those who believe they stand to benefit something from a fiat currency are very quick to turn their heads away from their own contrubutions to a system that, by design, enables the transfer of wealth from the people to those with the power to print.
Which is, of course, why the public schools, when they should be teaching what the stuff is, instead teaches that there's a value in controlling and 'smoothing out' the economy by manipulating the elasticity of a fiat currency. Not that events have proven the theory. Indeed, riding out the 'bubbles' is anything but smooth...Quote:
Originally Posted by DamianTV
Great information in here....reps all around.
fiat literally means 'by decree'. so any kind of currency that the state decrees to be valid for any and all monetary transactions is a fiat currency - regardless of what that currency is. in almost all cases it is paper money - since anyone who isn't an idiot would accept gold or silver for services/goods with no questions asked.
(the logical jump from that last statement is, if you are being decreed to use something and have no choice, it is because you're getting fucked)
http://photos.imageevent.com/stokeyb...single500X.jpg
fiat
fi·at
[fee-aht, -at; fahy-uht, -at] Show IPA
noun
1.
an authoritative decree, sanction, or order: a royal fiat. Synonyms: authorization, directive, ruling, mandate, diktat, ukase.
2.
a fixed form of words containing the word fiat, by which a person in authority gives sanction, or authorization.
3.
an arbitrary decree or pronouncement, especially by a person or group of persons having absolute authority to enforce it: The king ruled by fiat.
Maybe we should pay Gallup to find out for us.
Define fiat money:
A. Money not backed by a commodity
B. Anything officially decreed to be legal tender
C. Something used to buy (or have repaired) small Italian cars