No country has to use it as currency; in fact, countries don't use anything as currency, people do. As long as anyone uses it as currency, it's currency.
An example of this is in Viet Nam: " It is common for gold to be used for purchasing land and housing"
Libertarian666 wrote:
So a US Dollar is a token denominated in units of the US Dollar?
That is a circular definition, which doesn't actually define anything.
That's a circular definition indeed. But I didn't propose it. The one who wrote that sentence is unfortunately you.
No, I wrote the sentence with a blank in it. You're the one who filled it in with the word "token".
Hope that helps.
Yes, you're the one who wrote the sentence with the blank in it after I'd already given you my actual definition. I filled in the blank because you asked me to.
It's true that a "U.S. dollar" was defined as a specific weight in gold which is leftover from when gold was used as money (or at least backing it). It's like a law against a man walking on the inside of the sidewalk; still on the books but executivelly useless. The gold was just a reference point for "value".
A "Federal Reserve Note" is not a promissary note that funds a loan. It's a zero-duration debt instrument that you get on demand from a bank instead of bank money. Similar to a check or ACH, it transfers "value" to the payee in the form of bank money outside the financial system. So we use it as a medium-of-exchange as guise as "cash" only for old school or black market activities (I jest).
What backs a "Federal Reserve Note"? Technically, the Federal Reserve's balance sheet. But in reality to function as money, it is a taxation claim on the productive capital of the country. This is accomplished by income taxes and legal tender laws which requires all taxes and debts at the government level to be paid with bank money. There is no law that requires anyone to use or accept "Federal Reserve Notes" as a "cash" in the private economy, but this extends to bank money as well.
Last edited by MachineGhost on Sat Mar 26, 2016 12:25 pm, edited 1 time in total.
"All generous minds have a horror of what are commonly called 'Facts'. They are the brute beasts of the intellectual domain." -- Thomas Hobbes
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
Desert wrote:
My "wealth" these days is almost entirely viewed on a computer screen. I don't use a lot of cash, and rarely even write a check.
It is quite interesting, isn't it? Looking at my Quicken stuff, I see I had $300 of cash withdrawals in all of 2015.
Wow. You're pretty much all digital.
Speaking of Quicken, I started using it in 1994. I didn't realize that it would grow into this strange database of my whole life. If I want to know when I bought our last TV or coffee grinder, I can look it up in Quicken. Where did we go on vacation in '97? Look it up in Quicken.
Somebody posted the joke a few months back that went something like this: "Quicken, the only computer program that you need your parents to show you how to use."
I ALSO started using Quicken in 1994. Which version are you using? I have the Home & Business version which allows me to keep track of not only all income and expense but ALL investment transactions. The latter which I find to be invaluable.
On January 1, 1969, as a 17 year old high school senior, I started keeping track of every penny I spent. Used little notebooks. Still have them all. And, about 8 or so years ago I started entering the information from those notebooks into Quicken. I think I've made it into 1972 so far. If I ever finish I'll have my own personal inflation indicator.
I do remember that in 1969 Wrangler and Lee blue jeans cost $4 while Levis cost $5. Levis seem quite expensive now but I think they are in line with in inflation since 1969.
Vinny
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
