Post
Topic
Board Economics
Re: Fiat Money is a Bubble
by
keyscore44
on 06/11/2019, 10:12:09 UTC
Since many people try to convince us that Bitcoin is a bubble and how we will lose our money eventually, I wonder if money is not a bubble actually. There exist economies in which money has a positive value in spite its market fundamental is zero. That means fiat money has zero value. Fiat money is a social contrivance. We take money from other people because we know other people will take it from us. In theory and practice the fiat money is a bubble.

Don't forget that some fiat money is secured in gold and in gems. So it's not so easy to say it's a bubble.
However, everyone know that governments are still printing fiat money, and unfortunately this is very dangerous for the global economy.
I once found a country that was affected by inflation because the country printed its banknotes with a very large amount and was not controlled so as to make the country become devastated and the exchange rate was very severe, so in my opinion if more money was printed then it would make fiat money would affected by inflation.
Perhaps that country are no longer handled very well by the government. I believe that there is a law that applies to every country that certain money supply should be applied and if ever the money is being updated (changing its design and whatsoever), it'll need to dump and destroy the money being replaced so that they'll be able to create a new design for money which must have the same value as the previous one.

Of course, the change of the banknote's image or the exchange of damaged banknotes is strictly controlled. However, there are countries that do not worry too much about the amount of money they print - of course I am thinking about the USA. Unfortunately, but the US dollar is the guiding currency of the world and if the US prints dollars, the rest of the world must also print money to be able to match the level. And this is the bubble we should be afraid of.