Why an economic collapse is likely imminent

http://seekingalpha.com/instablog/439656-arbitrary-vote/11018-economic-fragility-underestimated-collapse-may-be-imminent

by stuffthatmatter • 17 years ago

12 5 17 years ago

seekingalpha.com

TrevorJ• 17 years ago

Also: Fiat money is based on faith in the country that backs it, and that faith is based in large part on the economic state of the country. It's a tautology.

philwelch2• 17 years ago

This is true, but it's also rather inescapable. Say you have a gold standard, for instance. The price of gold would rise based upon faith in the country that backs gold currency. Likewise, the price of gold drops when a country goes off the gold standard.

The economy doesn't lie, even when the government does things like declare legal tender. Declaring something to be legal tender, even fiat currencies, gives them economic value until it doesn't anymore.

joe_the_user2• 17 years ago

I agree that you can't just say gold is "real money" and be done with. But fiat currency does require a faith that gold does not, the faith that country won't print a huge amount of new fiat currency.

Why an economic collapse is likely imminent

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