justinian said:
S.T.A.G.E. said:
Mr Khan said:
S.T.A.G.E. said:
Mr Khan said:
The only thing gold backing does is make it that much harder to have a flexible currency. Fiat is simply more stable.
Who even operates on the gold standard anymore? India might, i think, though that's showing their weakness.
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Backed currency doesn't need to be flexible because its real. If you have it then you have it. Its amazing how much inflation increases prices to outrageous levels to the point that the bubble had to burst in this country.
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How is it real, though? How are shiny rocks any more real than bits of paper with pictures? (The practical uses for gold and silver notwithstanding)
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What is skin without a skeleton? Answer that question and you'll understand my point. If theres no backing you should've just saved a tree. Gold needed no backing because it was considered a desirable and rare object. In Asia rice was used as currency. You're basically saying air is just as valuable as a commodity that could pass for currency itself. Fiat currency makes it easier to create debt especially when people don't know where the money is coming from. You wouldn't be the wise as to whether the lender had mal intent or not. Everything today is based on faith....which is something we need less of if we want to stay out of trouble.
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I agree with your statement.
Ultimately people will believe whatever they want and usually that is whatever makes them comfortable. If they think the US dollar will be around in their lifetime or otherwise.
I like your point on faith although I take it from a different angle. I believe anything is possible because I have little faith in humans, espeicially those that seek to lead and thus become leaders. Decisions made within are the cause of the fall of empires and great nations. All it takes is a decision and a bad one can be taken tommorow or in twenty years.
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Faith is true in many respects and can bail a person out if they are having issues, but people would make less mistakes if more was expected of them. Faith on the other side of the coin philosophically should create risk, which is what people rely on from investors so yes. However when it comes to currency its a different story.
