The definition of 'FIAT' alone should be enough to put you off trusting it....

My brain-thing has been trying to level up my understanding of why I have less and less faith in the so called FIAT economy, that is to say an economy based around mediums of exchange (currencies) authorised and printed by governments and their central banks.

I knew the above already: that FIAT money is bascially government money (rather than gold, stocks, crypto for example), but it suddenly struck me today that I don't actually know where the term 'FIAT' comes from - there's no obvious link between the concept and 'government' or 'economics'.

If the term was 'GOVEC' or 'GOVMON' or something it would be obvious, but 'FIAT', it seems to bear no relation, until you look it up.....

According to Investopedia......

The word "fiat" comes from the Latin and is often translated as the decree "it shall be" or "let it be done."

And that pretty much both describes the FIAT money printing process and sums up why I don't trust FIAT - if the government, GOD LIKE, decrees 'let there be more currency' then there is more currency, so reliance on FIAT money = total reliance on government (and central banks).

I stuck with Investopedia as far as its four key takeaways about 'FIAT' money, sometimes it's interesting to stick with these sites for a mind-jolting refresh, and here their four key facts about FIAT currencies:

1. They're not backed by anything with intrinsic value
2. FIAT money gives central banks more control over the economy
3. Most (all?) modern paper currencies are FIAT ones
4. One of the dangers of FIAT money is hyperinflation.

So in short the definition and key features tell us that centralised authorities have pretty much total control over the money supply and they can turn the value of that money to zero if they so desire, by printing too much of it.

I mean, I know I know all of this already, but sometimes it's worth looking back over 'the basics' to remind yourself of just how fragile (ironically probably from the perspective of the government) the FIAT economy is, and how much of a fantastical invention they are.

Money as usual, that is FIAT money, really is just made up, it's there in the definition.

This should make you feel easier about Crypto

Back in 2018, when the crypto market was very much in the red' a friend of mine once came out with the line 'but it's not real, mate' referring to crypto in a drunken conversation, advising me to pull-out while I was still in profit.

I ignored the advice intuitively knowing that the crypto economy is no less real than the FIAT economy, I mean how can it be less real than numbers magicked out of thin air on the whim of governments and their FIAT issuing authorities - the central banks!

But while crypto may be nothing more than numbers on a chain at least...

1. Some of these funny cryptos actually have intrinsic value - like Hive's censorship resistance and voting power, or NFTs.
2. We the people have our keys and thus our crypto, not the central banks
3. We have the power to create our own cryptos, and tailor them to our needs.
4. We can choose to build in deflationary mechanisms such as limited print rates and burns.

All in all crypto feels like a total level up on currency (and the rest) compared to dirty FIAT!