Bending the Third Rail
Because We Should, We Can, We Do
Thursday, February 01, 2007
Fiat Money
Tim Iacono has written the easiest to understand but most important piece of economics I have ever read. If you've ever wondered about things like "money supply" and how it affects inflation and the economy, go read it. In a few minutes and with a few simply principles, Iacono tells us why Alan Greenspan was such a disaster and how Bernake is likely to be as bad.
Blogger Lynne said...
"Since 1971 when Nixon closed the "gold window", there has been no link between paper money (or its electronic equivalent) and anything that is limited in supply.

The world now operates under a pure fiat money system where paper money is "backed" by nothing other than faith in the government that issues it."

That is truly terrifying.