It's just a piece of paper!
At one point of time government backed every dollar printed with a certain amount of gold bullion. So Dollar really did have value at one time. This was also true for some other currencies.But sometime after 1970 the government stopped doing it. So your dollar really is not worth anything.The only reason currency works right now is because people actually think it is valuable and are ready to exchange it for all commodities.
Funny isn't it?
1 comment:
Gold is the currency of the world and dollar is the currency of your country.
The paper(currency) is just a thing that represents the abstract promise of your government's treasury.
Neither is valuable unless people work to make it.
I am grateful for the one who invented the money as a concept.
Now, if you excuse me I got to work and make some money. ;)
PS: One of my very early posts on money theory.
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