Twetch ·
These are excerpts from Benjamin Franklin's autobiography where he mentions fiat:
"About this time there was a cry among the people for more paper money, only fifteen thousand pounds being extant in the province, and that soon to be sunk. ...
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Twetch ·
The wealthy inhabitants oppos'd any addition, being against all paper currency, from an apprehension that it would depreciate, as it had done in New England, to the prejudice of all creditors.
Twetch ·
The utility of this currency became by time and experience so evident as never afterwards to be much disputed; so that it grew soon to fifty-five thosuand pounds, and in 1739 to eighty thousand pounds, since which it arose during war ...
Twetch ·
... to upwards of three hundred and fifty thousand pounds, trade, building, and inhabitants all the while increasing, tho' I now think there are limits beyond which the quanitity may be hurtful."
Twetch ·
I found this last bit to be prescient. Ben Franklin initially saw the usefulness of fiat, however he does believe there is a certain quanitity of fiat that would start doing more harm than good.
Twetch ·
This seems to be the obvious opinion of every common man. Fiat is useful, but at what supply does it become useless? How do you create an artificial supply, and at the same time cap that supply so that it remains valuable? There may be no solution.
Twetch ·
Or, if you're here with us, you probably would say that BitCoin is that solution. Though what I'm saying more explicitly is that fiat seems to be a broken model from the very start. Too much of a good thing is a bad thing, and fiat is that slippery slope.