Fiat money was a currency evolved from nothingness, completely not backed by gold. It can be in the form of paper money, accounting entry in banks, or even merely bit data in computer. It surely is worthless, but there are laws which impose a value to this worthless being. So, even if fiat money is worthless, it become legal tender in trade, payment, etc. because there laws in many countries backing. (fiat is come from Latin word that meaning let it be done).
This money became universally and gradually accepted post Bretton Woods System. If nothingness is forced to become a reality being, when the time comes, then it will break into pieces. We are not The Almighty God.
Last month, in pre-G-20 Summit in Washington, President of French, Nicolas Sarkozy proposed the necessity to re-establish Bretton Woods System, say Bretton Woods II that re-enacting gold standard. If the first failed, the incoming second surely will fail too if it repeats the mistakes committed by the first. These rules must be fulfilled if there is a will not to repeat a failure:
- Stockpiling money and commodities is forbidden. This ensures justice among mankind.
- There shall no legalities to make interest from money. This practice has been destroying the world.
- Gold may not be shaped in to unnecessary things like glass, plate, or any feasting equipments.
- Wealth must always circulate among mankind. Wealth must not only circulate among wealthy people.
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