7 ms·
what is "real money" to you? Fiat currency is real money to me. It's the only thing I can pay my taxes with.
by seoguru 9y ago
what is "real money" to you?
Fiat currency is real money to me. It's the only thing I can pay my taxes with.
- makosdv 9y agoI don't know who defined this originally, but the six characteristics that money needs to have are durability, divisibility, portability, acceptability, limited supply, and uniformity. Additionally, money needs to serve as a store of value, a unit of account, and as a medium of exchange. Fiat currencies do not have a limited supply and are therefore not a store of value (i.e., inflation constantly lowers the value of fiat currencies). The main reason that fiat currencies are still used as a medium of exchange is for the exact reason you mentioned: governments mandate their usage to pay taxes. As an example, gold and silver have been used as money for 1000s of years because they meet all of those requirements.