Hey Mises Community members, I’m back with another question. I’ve been trying to figure out why we have a fiat currency system. There is a ton of information on the 'net about the DISadvantages of fiat currency, but few resources that address its advantages. The best I’ve found so far is the disadva…

Have your friend take a dollar bill and tear it in half. The output of the good and services in the economy has not been altered, but the distribution of claims on these good and services has changed, all holders of dollars have 1/10^13 more buying power or something like that. So take the dollar bi…

I was under the impression that counterfeit only refers to “unauthorized” creation of “fake” or “imposter” currency, like painting a piece of paper green and calling it a u.s. dollar or painting a rock yellow and calling it gold. Since the Fed and the u.s. treasury are the “authorized” creators of t…

People readily use the word “counterfeiting” to impugn the FED, in part, because the FED (nor its supporters) refuses to acknowledge what it is doing. They use fancy terms like quantitative easing to trick people and the politicians (and media) merrily play along. So yes, counterfeiting, is the wro…

" Having a sound money—meaning a money for which the value doesn’t bounce around erratically, and doesn’t lose its purchasing power over time—makes all of these activities much more orderly. Having an unsound fiat money is (usually) still better than nothing, but in the extreme governments can …

one tiny advantage of fiat money is that there are no commodities in the economy that are ‘wasted’ on being used simply as exchange goods.

A fiat currency can be more fun because you can gamble your money when you deposit it in a fractional reserve bank.. it could turn out to be a positive investment!

One tiny advantage to having no legs is no dragging on the ground when you walk.

Advantages, for whom? Spending without taxing Increased state power Ease of war Transfer of wealth by stealth Incentive to submit to debt, benefiting creditors Erode savings, requiring continued work and / or dependence on the state Free raw materials for the banking industry Is that enough…

There’s one genuine advantage for the masses - fiat currency is infinitely subdivisible, so whenever the money supply began to squeeze trade, all that need happen is that a new subdivision is declared and new coins designed rather than the market needing to come up with a supplemental money(such as …

[quote=“Isaac “Izzy” Marmolejo”] Having a sound money—meaning a money for which the value doesn’t bounce around erratically, and doesn’t lose its purchasing power over time—makes all of these activities much more orderly. [/quote] I would change a minor issue: even in a free market with a gold …

Advantages of Fiat Currency?

Economics Economics Questions

Autolykos January 14, 2011, 12:54pm 18

Kaz, what is your source for that chart, and what is being denoted on the vertical axis?

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Advantages of Fiat Currency?

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