Quote from: Sextus on January 24, 2018, 11:44:49 AM

Fiat is very misunderstood. The best way to explain it is to look at the alternative, the gold standard. Given that gold is in limited supply (2% growth per year, much lower than economic growth) any gold standard will mean deflation when you have economic growth, so the value of gold reflects the new value being created. And deflation is very bad long term. It stifles trade because why buy something today when your money will be worth more tomorrow? Deflation creates a game in which the person who can afford to move last wins, as in very in favor of the ultra wealthy. Which means that with deflation they cannot go bust anymore, all they have to do is keep their money safe and deflation will do the rest, but with inflation they have to move their money otherwise inflation will erode their wealth in time. If you look at US history you'd see deflation causing depression in times where capital was flowing into the economy. Inflation stimulates the economy, the person who moves first has the most to gain because money is losing its value constantly.

Fiat is a very elegant solution to the problem of deflation. When you had a gold standard money was synonymous with value. But Fiat is not just value, fiat also stores debt because a debt is being made every time money is being created and our financial systems are set up in such a way that value rises to the top and debt sinks to the bottom. Bank bail outs meant the people at the top kept the value while the people at the bottom were stuck with all the debt. That is the problem, not fiat per se. But as long as fiat will be controlled by bankers and governments you'll get crap like this.

Most politician now they are using money for the fame and power.