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<p>[QUOTE=&quot;fatima, post: 1357233, member: 22143&quot;]This is not the case.&nbsp; The problem with this analysis, is that it assumes gold coinage acts like fiat currency.&nbsp; If you had 1000s of silver coins in your vault, how do you think these items would enter into the economy?&nbsp; Would you hand them away?&nbsp;&nbsp; You could only spend these coins and if production had increased to match it, else the coins would remain in your vault unless you were willing to take substantial losses on this asset.&nbsp; &nbsp; It was the same with the federal government.&nbsp; This is why they were still releasing the Morgans into the early 1960s.&nbsp;&nbsp; </p><p><br /></p><p>In other words, there is no way to introduce those coins into the economy unless the owner of those coins was willing to take a substantial loss.&nbsp;&nbsp; This is completely opposite of than that of fiat currency.&nbsp;&nbsp; In that case they can print it endlessly because it doesn&#039;t cost them anything to create it.&nbsp; Then they &quot;loan&quot; it into the economy and hence you have inflation.&nbsp;&nbsp; In the case of asset based currency, the currency does not enter into the economy until the economy has produced the wealth to support it.&nbsp; In a fiat based currency, the money is always created as a debt with interest with no restrictions on creation.&nbsp; </p><p><br /></p><p>These are completely different concepts of money and since almost anyone now living has never experienced the former, its difficult for them to comprehend.[/QUOTE]</p><p><br /></p>

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