Fiat Money, explained

[@mattgross6000]

Bill Nye da Finance Guy.

[@chozen_1309]

No kidding lol

[@vincenttabuzo4481]

Lmao

[@supermanbatmommy]

BILL 📈 BILL📈 BILL📈

[@paulsmith1981]

Being able to walk into a car dealership and exchange a hand full of paper for a car is pretty insane.

[@ZaraAxelrod]

so true and even weirder when you think about transferring credits to the car dealership electronically... and weirder still when you realize the government could credit people's bank accounts like that if it wanted to like in the recent stimulus

[@develentsai3215]

LET IT BE DONE:)

[@wiretamer5710]

Try and buy a car with cash these days, and you will probably end up with federal police paying you a visit.

[@amschelco.1434]

Buy car using crypto makes more sense..😍😍

[@43520tom]

@@wiretamer5710 They could pay you a visit, but if that money is legitimate they just wasted everyone's time. I have bought a new car in cash, nobody questioned anything. Now if you have a criminal record, no job, and a zero credit score, that may be a different situation.

[@mountain_maniac]

Thanks a lot mate ..U made it simple to understand.

[@danharrison]

Great explanation, Thank you Paddy!

[@shmeckle666]

"to fund a war or bail out a bank" HAHA LOOLZ. What more can yuh say?

[@dpapa2175]

Governments controlling our money? I always though governments were there to serve us, as impartial .I think it gives governments too much power to do whatever the hell they like.

[@CosmicSeeker69]

@d papa With respect you have much to learn. You (and the rest of us) are a pawn in a very big game - it's akin to communism. Start researching, but stay away from Google and Wiki if you want the truth. Try Maneco64 for Understanding finance

[@andrewf0784]

The key isn’t to “set” gold as currency by law... the key is to have a free market. The market would decide the currency via currency competition. Historically it has been gold. This is because it is rare, durable (doesn’t lose quality over time), and is easily divisible.

[@wiretamer5710]

Having a 'free market' makes absolutely no sense: its like trying to separate the north and south ends of a magnet. A exchangeable currency is intrinsically a form of regulation. Particularly when the executive controls the amount of currency moving freely at any given time. Also there is the whole issue of property rights, which are only exchangeable because of the regulatory framework of the bureaucracy and the legal system. Take away regulation and you have a failed state, where private property is not respected and the local currency is worthless.

[@proofofworkconsensus]

Now it's bitcoin

[@moses0686]

Gold isn't rare. Gold and diamonds are artificially scarce to keep the price up

[@bunnyfreakz]

They turn away from gold standard because US do not have enough gold. Pretty simple. Currently Russia and Australia have the most gold reserve. For sure, US don't want indebted to Russia.

[@artiealexis7903]

Money isn't real, and I'm out here chasing a check . 😅😅 #Humbled

[@swanpoll]

Kinijah DeGrate BT-1100

[@wailandkarisma4279]

Daydreaming or sleepwalking, which is which?

[@oluade1807]

hahahaah truuuu

[@juniorleslie4804]

Cash and credit is not real. Gold and silver is.

[@jamesadcock5235]

Joke will always be on us nice good working people

[@user-no5vv4bb6e]

@1:20 An American dollar is a dollar relative to who? Can't having nothing to back the dollar lead to messy situations beyond over printing and inflation? In terms of currency exchanges for example, how is it based?

[@AC-vp4ss]

Best and easiest breakdown! Thank you!

[@forlorndream1400]

All fiat currencies throughout the history of civilisation have eventually collapsed causing people to revert back to money in the form of gold and silver. These values fluctuate only as a direct link to the amount of currency in circulation in any given country. Remove currency and replace it with gold and silver money and it becomes the most stable system ever. All fiat currencies are debt based and as they're not tied to gold and silver then they're tied to our labour and that of our children. We need to work to pay taxes so the government can make payments on the bonds issued by their central bank. The government uses bonds to borrow from the super wealthy and uses our labour as collateral essentially selling us into bondage via the bond system. It then encourages us to take personal debt which traps us into the system and allows them to further multiply wealth/debt creation. The only winners in a debt based fiat currency are the super wealthy who own actual money. This is why fiat currency systems were expressly outlawed in the American constitution.

[@johnbrady8014]

do you think you could write this for me on my Econ Exam?

[@Alacard0malley]

I believe you. Can you site the exact section in the Constitution where they're banned? I'd like to have a read.

[@benmiddleton9984]

The value of the currency is decided mainly by the factors- demand and supply. If money is printed, it means the circulation of Rupees ( in case of India) in the economy will increase, though not proportionaly with dollar. The PURCHASING POWER of the people will increase as they will be having more money at their disposal. This in turn will increase the demand, which in turn will increase the inflation. The real problem here isn't inflation, it is the wage Gap that hasn't been keeping up with inflation. Since the 70s wealth for the rich have gone up 970% while wages for everyday Americans have been stagnant. That's the real problem. Closing tax loopholes and corporate incentives that benefit the top 1% needs to be addressed first and foremost. Nothing will change in this country until we do just that. Billionaires shouldn't be allowed to fuck over hard-working middle-class Americans for their Joyride. America needs to bring back antitrust laws and then this wouldn't be a problem. p.'s. The Federal Reserve is not a part of the federal government. It is a separate independent entity.

[@jakep2337]

An increase in the money supply only increases demand in the short run. In the long run, as you sort of mentioned, you end up at the same level of output but at a higher price level

[@bullterror5]

The "Middle Class" is a redundant economic description that largely doesn't exist anymore, aside from a few nostalgic but delusional financial, business & taxation policies. Modern Economic dynamics are now largely confined to the polar opposites making up the Poverty & Wealthy classes, which are perpetually expanding in size. Eventually Capitalist Societies will have to limit the profits available to the Ultra Wealthy & incorporate Socialist Policies to remedy the economic damages created by sustaining the Wealthy Classes at the expense of everyone else. Since the Middle Class who once functioned as stable economic "shock absorbers" can no longer increase their incomes & reduce their debts easily, a result of Business trying to save money by refusing to pay High Basic Wages in line with the Cost of Living, decent Wage Increases where appropriate & Employment inclusions like Child Care & Parental Leave. While the Governments protect them to cut such costs, the Middle Class continues to disappear right along with the "Economic Shock Absorption" they once created. This leaves Economies exposed to unrestrained "Market Trends" set by the Wealthy Classes as they increasingly become the majority of economic participants. Ultimately this reduction in levels of Economic Participation from the Middle & Poor Classes serves to drive up the amount of Taxation that needs to be collected from Business & the remaining Wealthy Classes to finance subsidies to remedy the problem. As the Middle Class are gradually incorporated into the new Economy of the "Working Poor" as a result of their Income not matching their Debt & Living Expenses, the Socio-economics of Poverty are becoming diversified & includes more & more people who despite employment, cannot sustain the cost of living, the costs of Debts & the cost of participation in a Capitalist Economy built on Consumerism. This leaves Employment & the financial independence from Gov it provides, as redundant for use as the first & end solution to this problem, which happens to also be the only solution Capitalist Govts are willing to use. When employment puts people further into Debt then people need to stop working. Australia encountered this dilemma with its "Robodebt Scandal" which was linked to increase in employment rates among those receiving financial subsidies from the Government. They couldn't reduce the amount of Money received from the Government by working because: a) They never earned enough; & b) What they did earn put them into Debt with the Government. On all accounts they were better off not working at all intead of working to earn more Debt. This Scandal caused by a Government initiative to increase Employment Rates & cut the costs of Social Security, resulted in the Government maintaining the same Social Security costs it was already paying, with an additional increase in costs in the form of Damages. Without issuing Debts the Fiat Money system cannot create more Money out of nothing. And if Debts can't be paid, the Fiat Money system never gains Value. In order to re-create the former Middle Class & engage people economically in the cycles of Debt & Consumerism, then the Cost of Living needs to come down while increasing Wages & Income, ultimately requiring Socialist Policies to be introduced by Governments in order to subsidise both the High costs of Living & the Wage Increases required. A Socialists response by Governments would require Higher Taxes to be paid by Business & the Wealthy Classes, who instead prefer to avoid paying Taxes at all, as they do now. So Governments can either collect more Taxes from Business & the Wealthy Classes now to pay for the subsidised Wage Increases of the Working Poor which Business refuse to Pay themselves, or the Govts can pay the Wage Increases directly, in addition to the financial subsidies already paid to the Unemployed. In the future the Business & Wealthy Classes will either have to pay more Tax, Pay Higher Wages & reduce their business profiteering from the Costs of Living voluntarily or else continue to cause such damages & be forced to pay moreTaxes at an even Higher Rate to cover the costs of a Socialist response to an expanding Poverty Class created by their Profiteering. Sure the Fiat Banking System allows more money to be created from nothing, but the same Fiat Banking System LENDS that money created from nothing in the form of Credit, only gaining the projected value of the money when it is repaid by Customers after it is first earned as Income. If the money cannot be earned, then the money cannot be repaid & the Debts issued do not have any Value, crashing the Value of the Banks. Not only does the projected Value disappear, but the Fiat Currency Debts of the Banks are sustained, meaning the Banks have more Debt & less ability to create new Money out of nothing. So yeah, Governments can effectively continue to create Fiat Money out of nothing for a declining Middle Class & the expanding Working Poor that can't earn a decent Wage, but it will not gain any Value as its unlikely to ever be repaid. On top of all of that, the Employment conditions are becoming increasingly automated, further reducing the amount of Employment available, while simultaneously increasing the profits of Business, Banks & the Wealthy Classes who are also having their overall running expenses reduced. This makes even more money for these already wealthy classes while expanding the populations in Poverty, who then require higher subsidies. Such Economic consequences of the Fiat Banking System under Capitalism are never really escapeable & will ultimately require a "Universal Income" to be issued by Governments & financed by the increased Taxation of the Business & Wealthy Classes. A Universal Income not only allows the Middle Classes & Working Poor to survive with Basic standards of living but also allows them to pay Fiat Debts in an increasingly Automated World. Without a Universal Basic Income then the Poverty Classes continue expanding & costing Governments more money, while more wage earners of the Working Poor are unable to pay Fiat Debts. So technically there is an invisible ceiling to Fiat Currency that ultimately limits the amount of money that can be issued by Banks & consequently the amount of money available to be made by the Billionaires & Wealthy Classes who profiteer off the Middle & Poverty Classes. The wealthy are making more money, although there is less of them & the poor are making less money, although there is more of them.

[@overthetop4247]

its fiat, in future its nothing, i am not sure but i think after this " great reset " comes like in 2030 then fiat is gone and digital currency is that people is using.

[@dellawatson1669]

@@bullterror5 this helped me tp understand some things that although i have read about then, for some reason i couldnt quite understand it... thanks

[@largelampard3721]

If the US wanted to remain the only super power in the world, that's what it'll take to do it. The top 0.001% and the rest. Because you can't tax the hell out of those company. Every country have their own economic model and are agreed by majority of citizens through voting in democracy region, or at least should be.

[@mattm9689]

Lmao your savings is backed by a promise this is why I started silver Stacking.

[@AntonyWrightOfficial]

Quite a simple explanation but good for a quick answer and your not wrong :) subscribed!

[@drkcrstl]

You should have really just said fiat money is tied to no physical good. Its only "valueable" (its not) cuz the daddy govmnt says so

[@metaverseplayer]

Simple explanation 👍🏾

[@maryallisonmusic615]

you are so good at explaining things!

[@joebidenw4385]

You look soo beautiful

[@19battlehill]

Tally STick used for centuries in UK during middle ages - is same as our fiat system -- an IOU.

[@juditbalatincz4997]

Bitcoin, ethereum or BNB? Which cryptocurrency is the best.

[@RHJunior]

less volatile??? When we were on gold standard, an ounce of gold stayed at $20 for over 130 years. The instant we went to fractional reserve the value of the dollar plummeted. by 1970 it took $44 american to buy an ounce of gold, then we went full fiat... and within 5 years it went from $44 american to $151. And since 1970 it's accelerated... an ounce of gold costs $1200 american today, with a peak of $1530 in 2011!

[@audra240]

RHJunior Gold does not back up the US dollar. It hasn't since 1934 when Truman was in office.

[@h1rschp]

RHJunior "an ounce of gold stayed at $20 for over 130 years." Really? Without fluctuation of any kind? And look at the variation in the price of gold today versus the dollar....which is less volatile?

[@williamhammer3252]

audra powell actually it hasn't backed up the US dollar since the 1970's when richard nixon was president. and truman wasn't president in 1934, franklin roosevelt was lol

[@audra240]

William Hammer The president is wrong but the date is right. Silver has not backed dollar since the 70's. It doesnt matter anyway because it is all worthless until we make it worth something. Gold. Silver,oil, currency or anything used for trade. It is all bullshit.

[@briannsession]

paddy hirsch With all due respect (I mean that sincerely), The volitility you mention in gold price can be skewed by looking at the "price" of gold in dollars rather than the "value" of Gold in goods and services. If you can find comparable goods and services that havent changed much in demand or availablility over the last 100 years ( ex. prostitution and a nice tailored suit), you'll find the "value" of gold hasn't waivered much for the last 200 years. Its the dollar's value that jumps all over the board depending on whatever new scam the Fed, the government, and their wall street/banker/corporate buddies are up to. The "price" of gold is more of a reflection of how strong or weak the dollar rather than a reflection on gold's intrinsic "value".

[@alanbatty3825]

First time viewing one of your videos, most informative thank you, have just subscribed.

[@TomasPruzina-uw9ql]

Better indicator of inflation is the total currency. Government prefers currency in circulation, because amount of money the print can be hidden in bonds and alikes instead of affecting prices of goods in the store. Eventually the people pay the price nevertheless.

[@noticiasparareflexionar9044]

In Venezuela, there is an induced hyperinflation

[@paulkelly9554]

That Latin Phrase is Wrong, The phrase is, "Let it become". If people lose faith in the currency that would lead to hyperinflation, because the currency is NOT backed by Gold only the banks word to honour the face value of the paper money...

[@reisele1980]

It's backed by our birth certificate bonds.

[@dellawatson1669]

@@reisele1980 what does that mean. Because my thought was money is backed by, we the people, who go out there and earn money, only to have most of it taken by the govt via tax, which kinda seems like what your saying. I may be wrong but to my understanding a bond is property. So in other words, we are the property of the govt. Makes sense. Its funny how they like to claim that money is backed by nothing, when in actual fact its backed by us, and now that you say a birth certificate is basically a bond it makes more sense that money is indeed backed by us working our tails off

[@EricaBeall]

Very well done, simple but all you need to know.

[@326sailingships]

FIAT= TRUST/FAITH Credit=Same thing; it comes down to trust.

[@ZaraAxelrod]

Good point, but fiat is actually money and credit is different from money and creates money

[@Goodmans93]

"Its not gonna be as volitile as in the past" Hahahaha aaaaaaaah!

[@dannydandan8495]

What i dont understand is: if what provides its value is the agreement of its worth then how is it still vulnerable to losing its value by QE?

[@wiretamer5710]

Most currancy is abstract today. Most retail transations are plastic. The whole overprinting of money and hyperinflation thing is archaic noncence. Hyperinflation was NEVER caused by overprinting currancy. Hyperinflation is caused by national economies are placed under siege by superpowers, creating a shortage of staple goods. The overprinting money thing is part of the effect of economic 'containment'.

[@ddbb6618]

Liked, subscribed and shared.... best compliment I can give.

[@christopherhart1640]

what is the alternative to fiat currency? you can't tie the value of a currency to a commodity because it doesn't take into account technological innovation and advancement. thats why you buy assets to make money and money is really just the blood of the economy it has to constantly move to create growth and innovation, it would stay still if u didn't have to move it.

[@buckleup8962]

You're all here for @1:45 and the marker throw is all of us now.

[@tomneila8496]

Carwise, 'Fix It Again Tony'

[@kerryharrison3806]

Excellent explanation thank you.

[@FrangoTraidor]

“Fiat money” is based on the ability to borrow against one’s future currency. And as long as this future currency does not foresee its “switch-off,” this borrowing against the future “white money made out of nothing” is essentially indefinite. What is destabilizing our “fiat money,” currently, is that the demographic whose future currency is being most severely leveraged now, DOES NOT SEE ITS FUTURE. And so, what is happening on the meta-scale is that there is massive borrowing against the future coupled with a massive shorting of “heritage America” and what is necessarily the violent electricity between rival racial currencies. Massive default is the air. The destabilization of “fiat money” and rise of “crypto-currency” reflects this dynamic. If man learns one thing from bedding woman, it is to keep all your currency to yourself and only dispense of it when you desire. Otherwise, you will be ruthlessly drained of your most mundane energy.

[@rosscopeeco69]

Hey Paddy, great to hear a familiar dialect from an expat of Northern Ireland. Really interesting.

[@ericjonath1248]

he jus explained it like a boss

[@brandonwaterfill568]

Thanks for the video. It really helped

[@madontherun]

Inflation in rich western countries is normally related to energy prices , especially Europe / Uk

[@martinjcar]

No joke. I genuinely believed it was "Fix it again tomorrow." I knew that was a joke about the car... but i genuinely thought it meant that in this context 🤔 just made sense 😆

[@otrhi7836]

It does indeed seem to mean that

[@rjjcms1]

Fits very well.

[@ZaraAxelrod]

Fix it again Tony, because it's an Italian make

[@chewie1355]

That was awesome. Thanks Mr Hirsch.

[@marcibonilla4963]

Not only USA ....99% of the country's in this world.hold fiat currency.

[@samarths.hosamani2226]

U r the best person who explained it so well.

[@chuchichaschtli894]

Nice vid thanks for sharing. Did Templars introduce fiat money from China to Europe at the pilgrimages age?

[@fonkvenco2278]

The video is essentially correct but I'd like to point out three things: - A dollar is still worth a certain amount of gold. It's just that you don't buy gold from your local commercial bank, because they're simply not in the business of selling gold. You go to the jewelry store or to your investment bank for that, depending on what quantity you want! - "A dollar is not backed by gold but worth only what somebody else wants to give you for it"... and so is an ounce of gold.... - Hyperinflation? Of course it has existed but iIt is hardly the first thing people should be worried about today. The Fed's and ECB's inflation targets are 2%, and they actually struggle to reach it - what policy makers are concerned with these days is the risk of *deflation* not hyperinflation!

[@asdasd-be5ww]

Fonk Vènço So losing 2% of all your money each year is not a problem. And struggling to only lower the value of peoples money with 2% is a noble and hard struggle?

[@dellawatson1669]

Yes but thats the problem. The dollat is only worth what someone is willing to give for it because they chose to stop backing money with gold, hence fiat money

[@hendywijaya3213]

Yeah, you're correct. Especially the 2nd point. People determine the value of gold and dollar using the same concept. Then what is real money?

[@kuchambifokwa3214]

Thks for the explanation u made it simple

[@Medietos]

Why do goods and services have to get scarce? Because not enough money may be earned from them to sustain factories and companies?

[@horaciodedona3912]

Good explanation. Lucky I don't live in USA

[@fergaldownes]

Hey there mate, pretty cool video that you have here. Thank you.

[@owlaboutyoumedaycarechildc8631]

Nh. H j Nbb. L

[@ericwolf9482]

Making it sound like if the US Treasury made one single $35 trillion dollar note and gave it to the privately owned Federal Reserve Bank and paid off the debt.. that would be it.. let's do it. Of course we would create a new currency just after .

[@roberthannah7983]

I'm not sure what the problem is. We've agreed to print fiat money (though our government and central banks) and use it to make payments, and it works pretty well - except for Venezuela, Mobutu's Congo, and the Weimar Republic. But you do need an independent central bank with credibility. Gold is too volatile and speculative to be money.

[@uturniaphobic]

it's so bad now, we actually have to borrow that fiat money from the Federal Reserve. We don't get to print it any more. we buy and sell with fiat debt, a promissory note created with fiat money by the Federal Reserve. So it's a loan (not money) that's printed out of thin air

[@dellawatson1669]

Yea, banks were able to print money before but now, they have to borrow it from the federal reserve to then borrow it to us. Banks used to be able to borrow between each other but a certain family who actually owns the federal bank made it so banks can only borrow from them. The government doesnt own the federal bank that certain family are. The govt are actually the puppets, rather than the puppet masters

[@ef7480]

But the important thing is only 3% of 'money' in the uk is in the form of printed bank notes...

[@simonbarr9476]

And most of the remaining "virtual" money is locked up in tax havens and controlled by a few people.

[@dellawatson1669]

@@simonbarr9476 soros? Or is it the other one. The name excapes me at the moment

[@mr.rabbit3088]

watching this in June 2022. Aged well!

[@childeharold3550]

My issue with gold is, outside of its shininess, what use does it have in the larger world? Is it just its rarity? Because there are other metals that are far more useful to human construction.

[@bostondugnutt1317]

It's a very unreactive so will stay unspoiled etc for a long time, also you probably don't want something that actually practically useful as your currency because then it would all get used up and not be in circulation as currency

[@3malhermano328]

So fiat in latin means “let it be done”, when king want a thing (paper currency for example) is worth a specific amount of value, the king just said let it be done like that. Fiat meaning: a money that does not backed up by golds or else valuable and we may potentially endure inflation because the goverment could crank as much as money to funds a war or else for example. they can print as much as they want to and we will endure it its a convenience for the government

[@Elovess]

Isn't printing money without a commodity to back it up money laudering and a crime?

[@johntracy72]

Fiat money is money by decree.

[@gasperkosmac7672]

Great video

[@h1rschp]

Gasper Kosmac Thanks!

[@chinastudies6345]

Greatly explained

[@MarioKL]

>It's great news for us, because now that the currency isn't backed by a commodity, it means it's not going to be so volatile Yeah, it's only gonna go down hill.

[@KeninBoulder]

Is FIAT another word for Cash?

[@HardKore5250]

How much was the dollar originally worth?

[@rjjcms1]

Not sure but wasn't the pound originally worth a pound of gold?

[@rjjcms1]

Did the word dollar originally come from a Latin word tala or something?

[@agliverpool]

I’m a complete newbie with Crypto.com. When I decide to cash out will I be able to use fiat in uk ?

[@kaalmansur]

It's interesting how terms can change and are left unexplored depending on who is explaining them. Cui bono?

[@chuggs8251]

do we use fiat money right now?????

[@Phil82961]

Yes .... The US is a Sovereign Nation. Our Federal Government is a Fiat Monetary Economy. The U.S. Congress passes a bill and instructs the Federal Reserve to fund said bill, Like every year, Congress has to fund Social Security. So when Congress Critters tell you "We need to cut S.S." they are lying to you, they can never cut Social Security Payments.

[@harrybaulz666]

Fiat provides security gold is inflationary

[@d.bcooper2271]

Are you jew ✡️ 😳

[@JeungFats]

Something unilaterally accepted is already here and it something one government does not control.....yet

[@todopoderoso5490]

The cotton in the one hundred dollar bill is already being replaced with that blue strip... its plastic... There goes our money

[@nerdly44]

This video is even more relevant in 2022.

[@fredrictengstrom5646]

Quire a clear explaination.15000 wiewers.RotchildrenZZ,shapen up.Capice?

[@DrumApe]

I never understood who actually keeps track of how many printed notes there are. Seems stupid to me to even pretend that is possible.

[@ashthomas1482]

Fascinating, okay ,how do you explain this then ? - the spending power of the £ between 1979/80-2024 ? Have we not lost in order of 90% ,And also with tax inflation on top of this ? £1 =1 lb of silver does it not . We are being robbed by pirates are we not ?

[@orangeblossom2488]

Money should be limited, because it is the drive of society , you go to work to earn money, if everyone could make its own money, no body would work so no more Ferrari maker no more bananas no more house unless you make them by yourself, so making money unlimited diminishes its value.

[@oamiry]

Try getting 💵 ! 🏦.🏧 seems to dispense the amount of cash bank has on 🖐 🤚 or willing to depart with!

[@johndevlin]

I think this would benefit from an explanation of what it means for the currency to be "backed by the government". Here it's kind of used just as a slogan, without explanation. I take it to mean two things: 1. The government will accept its currency in settlement of debts owed to the government (meaning that the money at the base of the system consists of "bills of credit"), and 2. The government has passed laws declaring the currency to be a legal tender for private debts.

[@dellawatson1669]

Its the first one. Banks borrow money from the federal bank with a promise to pay (iou) , The interest is passed on to us by way of inflation etc, but in order for the fiat money system to avoid collapse is to keep us in debt, which is why banks agree to loans etc. If there was less supply there would be less demand, but that would cause a problem because they have to keep us wanting to spend in order to keep demand high. This way people continue to take loans, which as i said, is the basis on which fiat money depends on. Essentially what they are doing would be classed as illegal because they are basically stealing from us so no theres no law, theyre just doing as they please, like they always do. The govt would like us to believe that they are in control of the money, but in fact they are not. The federal bank is private and not owned by the govt

[@Gmsrebukethetempter]

Very informative lol

[@jibraelescott6820]

So the truth of the matter is we're working to stay poor?

[@RydaliaAstora]

AAAHHH! My head hurts.

[@stefanhubenov8885]

So like it's just all currencies?

[@T2Exile]

so what the heck should i do with this paper???

[@Nicklessization]

Brilliant. Thank you.

[@snoopocalypse6580]

Might want to touch this subject again.

[@hayleejane777]

Hold on if they can just print all the money they want not being backed my gold why shouldn't I be able to do the same thing. Ppl working at the Federal reserves let me work there I need a nice house and some vacations

[@dellawatson1669]

Oh its backed by something alright. Its backed by the working classes blood, sweat and tears. Its backed by the high taxes one has to pay out of their wages, all while being unable to heat their houses in the winter

[@sicktoaster]

What if the government printed more money and then imposed price controls to try to prevent inflation and then imposed production quotas to prevent shortages? It seems like regulations often have costs but then it may be possible to stop those costs by imposing yet another regulation but I have a funny feeling there would be a problem with my proposal but I can't put my finger on what that would be.

[@dineshabe86]

Only the collapse of economy ? :) A)You cannot prevent inflation by price control, your currency will be worth less when u import something. Which will lead to raise in price in domestic market. Govt will be slow to raise price under price control which will push more people from investing in business , which will increase unemployment , which will reduce tax income and general reduction in goods and services. You can stop all imports and just operate domestically which will make the matters even worse. B)More regulations = more enforcement = more crime. You will create a black market with an alternative currency/mode of trade. And wide spread govt corruption , Severe loss in economic growth. Country that did this is india in 60's,70's and 80's.

[@sicktoaster]

@ dineshabe86 What if the government used public works to stop the unemployment? And what were the exact policies that India tried to use?

[@dineshabe86]

sicktoaster So i guess we both agree that govt cannot prevent inflation by price controls. And another unintended consequence of production quota is, it will wipe out small businesses and anyone who wants to enter an industry. Incumbents will use the regulations to keep new people from entering the market. Where will the govt get money for public works ? More tax ? With rising inflation these newly govt employed people will be much worse off, as govt will be slow to raise wages(or dnt want to). Another scenario is what is happening to indian railways. They raised the wages to very high levels, so to reduce the loss the officials dont fill up all positions :) So it is understaffed now and the quality of service is worse than it was earlier. It all comes down to the problem that govt is slow to react to changes in environment the reason is there is no competition to govt. Do read on license raj it is set of economic policies that india used from late 40's to early 90's. Things seemed to be good till 60's, then it was a nightmare. As a kid i remember waiting months to get a phone line or tv or any service. People will stand in long lines and go back home empty handed from govt food distribution centres.

[@sicktoaster]

@ dineshabe86 "So i guess we both agree that govt cannot prevent inflation with price controls." I never said that. In fact I said in a nutshell that as long as additional regulations were in place it may work. How do production quotas wipe up small businesses or anyone who wants to enter the industry if the quotas are selectively applied i.e. only to those businesses big enough to bare it? "Where will the government get money for public works? More tax...Inflation" Price controls to stop inflation. "They raised the wages to very high levels, so to reduce the loss the officials dont fill up all positions :) So it is understaffed now and the quality of service is worse than it was earlier." They could give them employment quotas. Or the government could start public works projects to give the fired employees work somewhere else. "Do read on license raj it is set of economic policies that india used from late 40's to early 90's. Things seemed to be good till 60's, then it was a nightmare. As a kid i remember waiting months to get a phone line or tv or any service. People will stand in long lines and go back home empty handed from govt food distribution centres." What if the people demanded an efficient, fast government and politicians were instantly voted out of office if they didn't uphold that?

[@dineshabe86]

sicktoaster Well you did not give any reply to my explanation on how price controls will not work. You are only seeing domestic market, which is exactly what countries tried to do. But it does not work , because no country is really self sufficient . In fact india did experiment on the very thing you are suggesting, they wanted an isolated economy decoupled from world trade. And focussed on domestic trade, it created massive loss in industrial output, unemployment. I would like to know how you would set the price of diesel ?(hint india did this and and changed this recently after seeing how bad this is). You need to explain why i am wrong or why price controls failed in all places where it was tried. If you persist to neglect that then i have to doubt if you really want to learn/discuss or not. You seem to be under the impression that good hearted people write regulation, that is not the case in reality. OFcourse in a world where govt is run by good people who want to look out for the weak ones it will work. But we do not live in that. Then we have to assume a world with no crime and stop spending on policing or army but we dont live in that reality. No it wont again , when govt sets price of petrol @1$ a liter today and 1.10$ next year it is also inflation. Please do read on price controls in indian oil industry and how it failed. This happend just 4-5 years ago. Eg: Price of petrol under price setting regime was 30rs a litre in 2003 march it was 70 Rs a litre in 2012. An average raise of 14% a year that is inflation. GOI was forced to do this because the national oil companies were running severe losses because for sake of votes(no govt was willing to raise prices). This is because of the reason i told earlier , govt is slow to respond to market changes globally. How will they give work somewhere else when they dont have capital or the money to start new business. The reason i keep bringing india is because they have tried exactly the same things and it was not long ago. We have to learn from the mistakes others/we made in the past.

[@shawnyfin]

Ok... what about digital currency backed by silver, as a solution?

[@maryallisonmusic615]

great video!

[@JeungFats]

Hello from 2021 your stimmy cheque here to save the day. But just that.

[@southerntiger3107]

There is a need for a government, our currency needs to be backed by something I hope we figure this out quickly but there is a bigger problem with our country that will cause a worldwide currency crash because of the deficit, Inflation, the military conflicts we get ourselves involved with around the world, and mismanaged leadership in our government. The problem started when Nixon got The American People off the gold slandered. We are at an 18.5 trillion dollar deficit and no-one will address the problem, the debt will be increasing larger each year. Americans better pull their heads out of our asses quickly. Americans are more concerned about Hollywood, TV shows and free money. There are more people collecting a paycheck from the American Government than are willing to go out to work. Most of our tax dollars are paying to a bunch of freeloaders. When Obama got his second term quite a few Americans were expecting free mortgages to pay for their houses, free school tuition, free paychecks to support their drug habits. This economic collapse will be a world wide event all countries will be hit hard.It's a shame that so many people refuses to accept the truth because the writing is on the wall and yet people choose to remain ignorant of this future problem coming. Fiat Currency is just the beginning, then bankruptcy, unemployment of all government employees, then riots until some sort of order will declare martial law. Our country will set our-self's for a possible dictator -- I hope not this extreme. I think we should cut Uncle Sam's balls off and donate them to science!

[@dellawatson1669]

I get where your coming from but if the govt is not prepared to raise wages to reflect inflation of course people wont want to work. If after bills, childcare etc, people are still living in poverty and cant afford to heat their homes etc there is no incentive to work, yet the rich pay less tax than the working class and get ridiculously large wages (such as bank mangers)

[@jimmywhite5045]

Is this why we have the rich and poor?? Because if we all had money the government or rich wouldn't be able to get the goods and services (slave labour!!) of the poor people!!

[@dellawatson1669]

Yep. Thats why there goal is, the rich will stay rich and the poor will stay poor. I remember margret thater openly and without shame stating that this was her goal. I was young and didnt understand it at the time because i thought, you cant stay poor if you work hard, but clearly removing the gold standard, high taxes and inflation was the plan to keep the poor poor

[@JohnRambo-nv9vn]

$31 Trillion 2023 😐

[@annefrank7820]

its the universal trust that this piece of paper will be honoured by a persons efforts in the form of goods and services. if an economy remains stable, this system will never falter, there is no fiat currency replacement for humanitys large population size. in addition, if you want to open your mind, check this pertinent experiment out, exactly how the cultural perpetuation of money works (systematic perpetuation being the banks, etc.): www.psychologytoday.com/blog/games-primates-play/201203/what-monkeys-can-teach-us-about-human-behavior-facts-fiction

[@ayandagwala62]

Fast forward 2022 .... yup

[@tarundeepsingh7567]

So how does a country knows how much currency it has to print????

[@MeecroHyperion]

That's the best part! Because it's is backed by this years production, you can spend(create) currency at the bottom up to full production, at least. The limiting factor and constant enemy, is inflation, which makes everyone's currency less valuable, but is easy to track. Notice we haven't taxed anyone yet - there's no need while inflation is low. Even if it starts to rise due to competition from too many $ competing for too few goods and services, increasing production of those items can mitigate. Only if government 'spending' (currency creation) unavoidably begins to compete with aggregate private spending does 'buying-power' need to be destroyed through Federal taxation to 'make-room' for collective spending on the group. Alternatively production can be stifled and working-citizens dis-employed to stop them buying things - which _might_ reduce inflation, but is more likely to create the recession the guv claims it's trying to avoid.. The currency is a promise for a share in this years net production, which is huge, even if heinously under-utilised. All we have to do is have a diverse domestic economy and keep an eye on inflation. It's really just 4th-grade arithmetic dressed up as rocket-science...

[@gantzthegreat8998]

Yea right, the federal reserve that makes your money decides on how much money to create, or destroy, dependng on how much wealth the owners of the fed decide they want to make that month! And keep in mind the majority of currency is created in the banking system via the fractional reserve system.

[@jasong2546]

now add in fractional reserve banking, recipe for disaster

[@jaakkooksa5374]

Jason G Fractional reserve banking is in no way contingent on fiat currency. You could be on gold standard and still have fractional reserve banking.

[@doorknob5720]

@@jaakkooksa5374 Exactly interest is cancer

[@jaakkooksa5374]

@@doorknob5720 Interest is the price you pay for the advantage of being able to spend future income today. I don't see anything wrong with it.

[@jaakkooksa5374]

@Mar Blox Banks compete for your money. Nobody is going to pay you interest because of kindness of their heart. The interest that you get is ultimately determined by the laws of supply and demand just like all prices, interest being the price of holding someone else's money (in this case yours). If you want higher interest for your money, find something riskier to investment in.

[@jaakkooksa5374]

@Mar Blox "You seem like an idiot." You seem like a person who has never read even a single book on economics in general or economics of money and banking in particular. Central banks are free to determine the interest rate at which they borrow funds to banks, which in the United States is called the Federal Discount Rate. Other interest rates, such as the rate that banks pay you for your deposits, are determined by the financial institutions themselves, through competition. Furthermore, there are an infinite number of other interest rates in an economy. For instance the interest rate of a consumer credit might be, say, 5 to 10 percent at this time when the Federal Funds Rate is close to zero. Please consider reading books. A couple of first year university textbooks on the basics of economics could be very useful to you. www.investopedia.com/ask/answers/who-determines-interest-rates/

[@CristianoBinRonaldo]

it is backed by government. how we can just believe any government? they can just devalue it any time just like that. so saving in fiat money is uncertain as F

[@summerfinn2300]

thank you so much!

[@tommartucci2886]

Paddy, COVID white board?

[@angelearth8006]

There are more people in the world working and providing those goods and services; could it be something as other than 'inflation' that is devaluing the dollar? Gold is abundant on the planet, just like diamonds. Something is amiss here?

[@dellawatson1669]

Corruption and greed. Nothing more, nothing less

[@hbtechgamerz9852]

Yo

[@digvijaysingh6882]

Thanks a lot.