How Fiat Money Fails: Deconstructing the Government’s Paper-Thin Promise

Fiat money has a surprisingly short lifespan. The almighty U.S. dollar currently serving as world reserve currency is not exempted, in spite of all proclamation that it cannot fail. Throughout history, fiat money has failed over and over again, where sound assets like gold have survived. Ruling out acts of god and unforeseen circumstance, the number one reason fiat fails is due to unsound economic policy. This is where gold and bitcoin stand to truly prevail.

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Good as Gold

There’s a reason no one hears people saying “good as fiat” to describe something trustworthy or valuable. Gold has been used as currency for thousands of years, since at least 700 B.C., when it was favored by Lydian traders. The oldest fiat money still being used today has only been around for a little over 300 years, beginning in 1694 with the founding of the Bank of England. Prior to its use as currency, gold…