Jesus f***** Christ.
Here it seems everyone is doing his own definitions. I have MA in macroeconomics btw. No, money is NOT commodity. Money is what people accept as money, period.
DEFINITION OF 'COMMODITY'
1. A basic good used in commerce that is interchangeable with other commodities of the same type. Commodities are most often used as inputs in the production of other goods or services. The quality of a given commodity may differ slightly, but it is essentially uniform across producers. When they are traded on an exchange, commodities must also meet specified minimum standards, also known as a basis grade.
2. Any good exchanged during commerce, which includes goods traded on a commodity exchange.
Money is a commodity because every unit is interchangeable with any other unit of the same type. Gold can be money because every coin is interchangeable with every other coin of the same type of size/weight.
When you say "money is what people accept as money" you are right, but beg the question "what does people accept as money?"
Individuals could accept anything as money one time, but what will they continue, in the long run, to accept as money?
What is the fitness function of money?
What people will accept as money in the long run is what have the best features to be money.
Being debt and relying on a third party is not a good feature for any form of money.
Fiat money have some features making up for this problem, albeit not completely.
What you are talking about is monetary base and you have some false assumptions about it as well. If everything what you write was true, fiat money would never existed, yet they exist based on thin air.
In fact, fiat money could not exist without being linked to something from the start.
Fiat money, initially, was linked to gold and/or silver.
When the link was removed (after the possibility to return to gold and silver coins was removed too) people had some past experience of the value of fiat money (E.G. how much 1 $ bill could buy). So it continued to work. Every other fiat currency created is always linked to something else at the time of its creation (E.G. the was linked to a fixed exchange rate with the previous national currencies).
Any counterfactual example of a fiat currency established without any link to a previous currency or form of money?