How many people know what fiat currency is?
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.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If Congress repealed all legal tender laws (nobody is forced to accept a given currency as payment for private debts, nor required to acquire it for payment of public debts), the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.
Last edited by Steven Douglas; 10-23-2012 at 09:14 PM.
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.
1776 > 1984
The FAILURE of the United States Government to operate and maintian an Honest Money System , which frees the ordinary man from the clutches of the money manipulators, is the single largest contributing factor to the World's current Economic Crisis.
Privacy and Anonymity are Essential to Liberty. Without them, we leave ourselves open to Police State Abuses. - Yieu and others
You are Ron Paul's Media!
Anything can be considered fiat.
How is the "Silver Dollar" ... 371.25 grains of pure silver considered fiat?
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.
yeah exactly.
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.
Last edited by Machiavelli; 10-24-2012 at 10:48 AM.
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