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Napanee, Ontario | "The main functions of money are distinguished as: a medium of exchange; a unit of account; a store of value;"
You are kind of missing my point. If as a society, we choose to use money, or currency to facilitate our trade, then it shouldn't matter if it is a fiat currency or not. Chunks of dried cow manure would work just as well.
And if people want to stow it under a mattress for 40 years, they should be able to, since a function of currency is to store value. We don't have that functionality now, but it is NOT as a result of using fiat currency. Fiat currency can and does work, as long as there is confidence in it. And that comes from proper regulation.
Using gold as currency is prone to the same problems as fiat money. It can be counterfeited, more of it mined and "created" - just like our printing presses accomplish. It's about using a proper index to control the volume - ie indexing to GDP or another REAL measure of economic value.
Edited by OldMcdonald 12/27/2013 10:25
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How does an economy with no inflation/deflation function?
