The truth about fiat money.
The hallucination we've all lived for far to long.
"Mommy, what is money, how does it work"
Well probably the correct answer goes like this.
Most of us do not really have a frigging clue.
I think it has something to do with.
The allocation of special drawing rights.
Through the International Monetary fund & World banks.
In a free floating System of marketed exchange currencies that compete through trade balances an international spectrum of inflation adjusted exchange rates that then can be used to create local debt that is issued by the treasury in return for that is printed bank & distributed to the banks that by through a system of partial reserve leverage of leverage at approximately of ten to one.
Then distributed into the economy creating either inflationary or deflationary effects.
Allowing us all to experience the velocity of trade to the exchange of an abstract token. That represents the promise of future depreciation and by the of inflation & adjusted for the return on investment.
Try go and ask people in the street.
Why does Money have value. They have no idea.
They all have own theory's.
They have a fairytale, they have a story.
The story that is as solid as the story of Santa Clause.
Because it says on the piece of paper that it is 20 dollars.
It says says something along the lines of.....
"By the full faith of credit, of Federal Reserve system or the bank of India. ! Federal reserve note or 1 commonwealth note 1 dollar or something like that."
I guarantee most people in the street still think it is backed by gold in a cave or a boxed vault where to government keeps all the gold in direct proportion to all the money that is in circulation.
Which is fake and has not been true since the 1930s across the entire world. This is the Santa Clause fantasy most people actually believe in. Or they believe that the government somehow guarantees the value of it. Which should make you ask why does inflation happen. Why are currencies collapsing like Zimbabwe and Venezuela. Did their government not try hard enough to guarantee it or something. That is the inconvenient truth at the core off trying to understand the worlds most ancient technology that is money.
The truth is we the people give money value.
Why or do we the people give it value you ask.
Because we are participating in a shared hallucination with billions of people.
Where most of us firmly believe that tomorrow the money will still have the same value when we wake up. That if we go to the store tomorrow and present one of our coloured pieces of paper someone will agree to give you eggs or some chicken maybe some rice or sugar, housing or healthcare. Something of value in redemption for your coloured piece of paper.
This is the incredible hallucination we all live and has taken hundreds of years to establish.
It all started at some point way back in the 1500s with the introduction of paper money notes. Gold IOU certificates of exchange or barer notes etc.
Then they switched the cups on us so when we lift the cup the ball is gone. That original piece of paper that used to be able to be redeemed for that amount of value in gold or silver. Now is no longer backed by the physical gold or silver any longer.
Now it is backed by the promise of debt owed.
Nixon severed the gold from the paper back in 1971.
Now its only our shared belief in that paper promissory note that gives it value. The belief that if you take it to a store you will be able to redeem or buy something with it.
New countified money chases out old money.
In reality real money has to be unforgeable, and portable and divisible. It also has to be a unit of account and it has to be rare.
Our old way of barter will never work because of the different trade of exchange rate to every different thing we wish to trade.
Years ago in the mountains we used sea shells as a currency of trade because sea shells we rare in the mountains and on the beach we used crystals because crystals were rare on the beach coastline.
That is what is wrong with the money of today it is not rare.
It can be printed infinitely in each currency of each currency.
When this infinite money is created and moved from the debtor to the saver it becomes worth less value to the saver. In depreciation of its purchasing power do to more inflation of the supply in circulation. An inflation example is at 2%.
Ah its Ok it's only 2% you think. But now think, in 25 years at only 2% your half of the purchasing value of your money is gone.
Inflation eats your purchasing power.
Bitcoin is a strange being it really is.
It violates we way in what think we know about money.
It forces us actually to ask the question if we ever really understood money.
Bitcoin is made up of 1000 milli bits or 100,000,000 sats.
That we can transact freely across the globe via the internet peer to peer in a permission less economy.
Where there is no 3rd party intermediary's in the middle of our transactions. The only thing close we can compare to Bitcoin is gold. But we cannot email gold.
Bitcoin is not a get rich quick scheme.
Its a new technology that for the 1st time in mans history allows us the free flow of money globally with no need for trust or 3rd parties to verify and approve our transaction of value.
