I understand your narrative, but that's not correct in a rigorous analysis.
Fiat paper does not represent a promise, it's not backed by anything, you cannot redeem it for anything.
It's the equivalent to gold, or bitcoin, a stupid rock without liabilities or responsibilities.
The original dollar paper bill was a promise to pay out gold, so to say a money warehouse receipt.
But in 1934/1971 the paper changed to not be redeemable for anything anymore, thus turning it into base money without counterparty risk, because there is no counterparty that can fail to honor the payout of gold.
Yes, I think the only sense in which fiat is really "backed by govt" is the promise that it will be accepted by govt as taxes.
Yup. Fiat gets its value because it’s the only way you can discharge your liabilities to the state. That’s what the Brits did in South Africa, imposing a ‘hut tax’ that could only be paid in British currency.
They don't even promise you that...
It's a promise to cancel other liabilities in an equal amount to the denominated face value. Nothing further, yes, but that it functions at all has its root in its ability to make the men with guns leave you alone at tax time. The government agrees to accept these "leave me alone" tickets, and in exchange, the bank agrees to provide the government with them most any time it wants them to buy things.
It's just the grease in the kleptocracy machine.
dont agree, paper fiat are based on the promise that you will exchange it fro goods and services. The difference with gold and bitcoin is that you have a natural expectation of exchanging them for good and services in future based on their property and phisical laws;
with paper fiat the expectation is based on an artificial gun enforced centralized power that promise you to maintain power and dont fuck up all. And most of fiat promise are been already broken, all of them will be broken at some point.
I'd say this isn't correct either, saleability is neither a promise nor a contract.
I'd suggest reading What Has The Government Done To Our Money by Rothbard,
https://mises.org/library/book/what-has-government-done-our-money
And The Ethics of Moneyproductuon by Hülsmann.
