Cable Forum - View Single Post - Sterling At Risk Of “Large-Scale Devaluation”

**Chris** · 19-02-2013, 20:20

This. ^

Fiat currency - its value is what it is said to be.

This is not necessarily a disaster, and it certainly didn't come about by accident. The advantage of a fiat currency is that it allows a cash value to be attributed to non-tangible things such as labour. In a modern economy where most people neither farm the land nor manufacture goods from their own raw materials, it's the only effective means of allowing economic growth. A currency tied to any finite resource, such as gold, can't in the long term cope with non-tangible assets.

19-02-2013, 20:20	#29
Chris Trollsplatter Cable Forum Team Join Date: Jun 2003 Location: North of Watford Services: Humane elimination of all common Internet pests Posts: 38,300	Re: Sterling At Risk Of “Large-Scale Devaluation” This. ^ Fiat currency - its value is what it is said to be. This is not necessarily a disaster, and it certainly didn't come about by accident. The advantage of a fiat currency is that it allows a cash value to be attributed to non-tangible things such as labour. In a modern economy where most people neither farm the land nor manufacture goods from their own raw materials, it's the only effective means of allowing economic growth. A currency tied to any finite resource, such as gold, can't in the long term cope with non-tangible assets.