In contrast to commodity-based money, such as gold coins or paper bills redeemable for precious metals, fiat money is backed entirely by the full faith and trust in the government that issued it. What happens to the money when nobody trusts the government?

[–] • 10 pts

Trust is one part of it, but fiat is really backed more by force than anything. As long as they can shove a gun in your face and make you use it, they will.

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[–] • 3 pts

This. The USD is backed by threats of violence from the DoD (external) and law enforcement (internal). We are free range prisoners, and people don't realize it.

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[–] • 2 pts

Wow why does the IRS need so many guns and so much ammunition? Haha they're just scared that's all. Right?

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[–] • 2 pts

this

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[–] • 4 pts

Other governments and businesses outside the country of origin refuse to take the currency as payment. You'll probably get hyperinflation like Zimbabwe or the Weimar.

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[–] • 2 pts

Better trade em before the music stops.

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[–] • 2 pts

Inflation. You are living it.

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[–] • 2 pts

Bingo! Amazes me how many people have had to wake up to this reality.. we been living it for quite a while, just now it's reaching Weimar levels.

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[–] • 2 pts

Paper money is backed by the fact that it gets the Internal Revenue Mafia off your back for a year.

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