Fiat Currency Always Fails

[jeronimosuykens]

I've been hearing variations of this statement for years now, so much so that my mind just tunes it out when I see the words.  "Fiat always goes to zero" is part of the propaganda that precious metals dealers and others use to play upon people's fears so they can sell them gold & silver. 

The US dollar might eventually die.  It probably won't in any of our lifetimes, though.  I think bitcoin has a better chance of becoming obsolete and dying than any of the world's stable fiat currencies.  Be very careful what you listen to when you read this shit on the internet.  Always take into account what people's motivations might be for telling you why you need to own gold & silver--they're probably trying to sell it to you.

Actually, electronic money or cash is no problem. Cash used for many years is no matter what it is too old to lose. However, if we have confidence in electronic money, we will reduce the cost of cash production. Electronic transactions are faster and safer.

[patarfweefwee]

Though it may be true that fiat fails, fiat has been with humanity for as long as humanity has economy in their culture. That being said, fiat is a hard economic system to remove or even exchange with something as new and volatile as crypto currency. It would need time and alot of patience for this to happen.

[JohnWick_Bitcoin]

Though it may be true that fiat fails, fiat has been with humanity for as long as humanity has economy in their culture. That being said, fiat is a hard economic system to remove or even exchange with something as new and volatile as crypto currency. It would need time and alot of patience for this to happen.

I agree on that, fiat currency might fail someday because people will prefer to invest on on bitcoins but government will still do something in order to reduce the number of investors of cryptocurrency.

[Renai0925]

This is why we need the blockchain and cryptocurrency to keep track of all the money being produced. Over-issuing fiat currency will eventually bring the downfall of all countries if not kept in check. The world debt is actually fascinating as to how it will be paid with the amount that doesn't exist.

[BoisclaiR]

Though it may be true that fiat fails, fiat has been with humanity for as long as humanity has economy in their culture. That being said, fiat is a hard economic system to remove or even exchange with something as new and volatile as crypto currency. It would need time and alot of patience for this to happen.

I agree on that, fiat currency might fail someday because people will prefer to invest on on bitcoins but government will still do something in order to reduce the number of investors of cryptocurrency.

Very honestly I do not think that it is going to happen, I think that it will take a lot of time may be more than half century when people will totally stop using their fiat currency and will use bitcoin for everything for which they were using bitcoin.

[leavefifa]

We can see the failure of Fiat in Venezuela. Inflation has completely devalued the currency. Carrying too much cash just to buy a roll of toilet paper reflects the entire cash shortage during the period of inflation. And the Venezuelan government has issued the country's electronic money as a way to reduce inflation.

[McEdward]

It is unfortunately true. That is why we are developing and looking for something better. Mankind is evolving and we understand now that we cannot rely on fiat money. Many years ago, we even did not think about that. Everything was fine. Evolution pushes us to think further. In the future, we will have virtual money. We will not need currencies that we have now. All our equipments will be digital, therefore, we will need digital money. Fiat money was just a point in our history.

[Wall_Streeet]

also read about this assumption and mark the history, you need to study this fact in more detail, because perhaps this is another advantage of bitcoin

[Airbuxf]

In my opinion As long as fiat money still serves as a medium of exchange, it will always be needed by the people of today and therefore it will always have a function as an asset to all of us. although the best value-keeping asset is gold but even though gold is quite liquid, it is no longer money that serves as an intermediary.

It would be good to use gold as payment again or at least money that is backed by gold. Now we are paying with printed debt. It's best to keep your assets in gold and cryptocurrencies in my opinion.

[BobK71]

The fiat currency has never failed Howard it just an evolution from the phase of the global economy know when you look at the phase of the fair it is just an evolution from the barter trade system and this is just a symbolism of the fact that democratic form of currency always prevails in this system

It is true, that we have no choice but to use 'fiat' money and trust it, at least to some extent.  As Paul Krugman said, fiat money is backed by men with guns.

It's also true that the incentives for the elites are always to inflate and devalue 'fiat' money, so we have to diversify our savings to protect ourselves.  (But never put all your eggs in one basket: you never know how long each bubble will last -- some bubbles are backed by the full power of the global empire.)  See The Real Reason to Hold Gold and Bitcoin.

[skish85]

Do not forget that the money at the moment is more stable and more secure than crypto-currencies. They do not tolerate any setbacks. The dollar and the euro are growing - they are all fine.

[Hell-raiser]

Some of you guys in this forum are full-time dumbos. So you think that when dollar falls that means that it is over for the whole world and that Bitcoin and other crypto currencies will come and take over ? Sounds like something only a dumb person would say. How can you be thinking that? Whenever dollar falls, the value of Yen and Euro will appreciate. Bitcoin is not a real currency, it’s just like something else made to be on its own and when you’re using it you’re in complete control of your money and not the government being in control.

Well, I agree and disagree with you on that point at the same time, about Bitcoin not being a real currency. I agree that at the moment Bitcoin can hardly be considered a genuine currency on purely practical reasons. You can't buy things with it directly, that means Bitcoin doesn't circulate but this is what the term itself (currency) stands for. On the other hand, there is nothing which would prevent Bitcoin from becoming a currency, there is nothing in it inherently which would not allow it to become one. It may not be a very good currency overall due to its deflationary nature (and a few other issues), but this is a completely different story.

[Ayush rana]

I don't think fiat always fails, you can see fiat has been using for buying and selling goods and services since centuries. Fiat currency actually create a centralised system for people and it provide system to do business. i Know why you said this statement because recent years there was a collasp of economy and Europe crysis, Venezuela currency fails. But because of few fails we can't say always fails.
well i support fiat as well as crypto.

[KS03]

Yup all fiats fail and they usually fail around the 40 year mark.  We are well past that as the clock started ticking in 1971.  Once the US Dollar goes down all hell is gonna break loose. 

[Hell-raiser]

Yup all fiats fail and they usually fail around the 40 year mark.  We are well past that as the clock started ticking in 1971.  Once the US Dollar goes down all hell is gonna break loose. 

The US dollar won't go down until the US itself disintegrates and implodes. It has been discussed in great detail and at great length a few pages back in this very thread. A fiat currency is not going anywhere until and unless the government behind it collapses. Fiat currency decay is a direct result and outcome of the ultimate failure of the state but definitely not its cause. Everyone who claims to the contrary should go learn history (Roman Empire, Weimar Republic, Yugoslavia, Soviet Union, etc).

The bottom line is that while the US economy is strong, there's absolutely no reason to think that the dollar is going to fail any time soon. Don't be delusional or lost in pipe-dreams about that thing. ZeroHedge and outlets like it have incessantly been crying wolf for years without any real ground supporting their claims.

[Ranly123]

See:

There Is No Escaping History.  Fiat Currency Eventually Fails.

Notice that this is a critique of fiat money -- not a critique of state-issued money under a gold/silver or other standard.  Fiat money is a rare occurrence in modern history.  (We live in strange times!)  As we can see, the examples found by the author are a small number of short periods here and there.

I have my own critique of gold/silver standards, but that's another issue.

Maybe on history, paper money tends to be no value because of the coins they are using which is gold, silver and bronze. Those precious metals are very valuable than paper that's why authorities of centuries ago make it hard to make a value out of paper. But as you can see today, paper money is very valuable and I don't believe that is would fail.

[prtty2gal2]

I don't think fiat always fails, you can see fiat has been using for buying and selling goods and services since centuries. Fiat currency actually create a centralised system for people and it provide system to do business. i Know why you said this statement because recent years there was a collasp of economy and Europe crysis, Venezuela currency fails. But because of few fails we can't say always fails.
well i support fiat as well as crypto.

Oh Please! That is what they want you to believe. Fiat has been doing extremely poor in the past and will keep doing so in the future. Just as the article rightly mentioned by the OP, government prints fiat money that isn’t backed by any value which obviously ensues disaster in this regard and just to be able to contain it, they keep printing even more as time goes on.

The huge interference, monopoly, and control of government in this case as well as the high extent of devaluation, are just some of the quick reasons why its closeness to getting screwed is inevitable.

[valentine401]

In my opinion As long as fiat money still serves as a medium of exchange, it will always be needed by the people of today and therefore it will always have a function as an asset to all of us. although the best value-keeping asset is gold but even though gold is quite liquid, it is no longer money that serves as an intermediary.

It would be good to use gold as payment again or at least money that is backed by gold. Now we are paying with printed debt. It's best to keep your assets in gold and cryptocurrencies in my opinion.

Gold is a bad way for payment because not every people can earn gold and it was really hard to earn gold now a days, cryptocurrency is much better since every one can invest if they have a decent amount of capital.

[Kevinvaonav]

most people misjudge the example: in our midst, people mistakenly believe that a country's paper money is issued by the government. whereas paper money, as well as coins that are associated with it - and bytes in the computer he created - are issued by the central bank. Most central banks are private companies, privately owned by a group of bankers. more than that, most of the money circulating in the community is no longer in the form of 'physical money' (currency, paper and coins)

[crazymelons12]

In my opinion if dollar should fail, I don't think other currencies will follow or the entire world will be in a bad economic state.  Given that the reason will be the fall of dollar only. There are other countries which I think is sufficient enough to stand in their own and might not be affected should it happen. Yet resources and the entire economy should be stable if all countries will work together.