In arguably the #1 work of German literature: Goethe's "Faust", the devil (Mephistopheles) convinces Faust to go to the near-bankrupt Emperor Charles V, and persuades him to issue... Paper money.

The notes signed by the Emperor spark a consumer boom where “half the world seems obsessed with eating well/the other half with showing off new clothes”.

Only after Mephistopheles and Faust vanish does anyone notice the value of the notes refer not to gold in a vault, but to the promise of gold yet to be mined.

Inflation takes hold and economic disaster looms. Rebellion follows.

Faust, meanwhile, has invested his proceeds from the paper money scheme in land reclaimed from the sea. Goethe condemns the endeavor to failure for denying the laws of nature just as its paper money financing ignores the laws of economics.

Sound familiar???

Written in 1831. Before Weimar, before Bretton Woods. Before 1971.

We will never learn.