Money that a government has declared to be legal tender, despite the fact that it has no intrinsic value and is not backed by reserves. The only thing that gives the money value is its relative scarcity and the faith placed in it by the people that use it. The last vestiges of the gold standard disappeared in 1971.
Sunday, October 12, 2008
Fiat Money?
Money that a government has declared to be legal tender, despite the fact that it has no intrinsic value and is not backed by reserves. The only thing that gives the money value is its relative scarcity and the faith placed in it by the people that use it. The last vestiges of the gold standard disappeared in 1971.
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