Via Duino Schiappapietra,
The monetary system is a major component of the whole economic system. Despite that, today we take it for granted and don’t even ask ourselves how it works and if it is the best solution available or the correct way to manage things.
Even though it appears to be stable, history shows that monetary systems changed periodically in the last century (20–30 years on average).
The main difference between our current monetary system and previous monetary system is that today it is entirely based on FIAT Currency, in contrast to older monetary systems that were backed by gold.
That means that what we call money is a government-issued currency that has zero intrinsic value and is not backed by anything.
From 1971, this kind of system allows central banks to literally control the economy and opened a new chapter in the world monetary system.
In this article, I am going to briefly explain why 1971 changed everything and what are potential consequences of such a decision.
Since 1971 the world runs on FIAT currencies that are not gold-backed in any way. This changes everything.
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