Fiat Money


Fiat Money
Currency that a government has declared to be legal tender, despite the fact that it has no intrinsic value and is not backed by reserves. Historically, most currencies were based on physical commodities such as gold or silver, but fiat money is based solely on faith.

Most of the world's paper money is fiat money. Because fiat money is not linked to physical reserves, it risks becoming worthless due to hyperinflation. If people lose faith in a nation's paper currency, the money will no longer hold any value.


Investment dictionary. . 2012.

Look at other dictionaries:

  • Fiat money — Fiat Fi at, n. [L., let it be done, 3d pers. sing., subj. pres., fr. fieri, used as pass. of facere to make. Cf. {Be}.] 1. An authoritative command or order to do something; an effectual decree. [1913 Webster] His fiat laid the corner stone.… …   The Collaborative International Dictionary of English

  • fiat money — Money that a government has declared to be legal tender, although it has no intrinsic value and is not backed by reserves. Most of the world s paper money is now fiat money …   Big dictionary of business and management

  • fiat money — ☆ fiat money n. currency made legal tender by fiat and neither backed by, nor necessarily convertible into, gold or silver …   English World dictionary

  • Fiat money — Yuan dynasty banknotes were the earliest fiat money. Fiat money is money that has value only because of government regulation or law. The term derives from the Latin fiat, meaning let it be done , as such money is established by government decree …   Wikipedia

  • Fiat-Money — Heute sich im Umlauf befindende Banknoten und Münzen sind in der Regel Fiatgeld. Assignat über 500 Livres von 1794 …   Deutsch Wikipedia

  • Fiat Money — Heute sich im Umlauf befindende Banknoten und Münzen sind in der Regel Fiatgeld. Assignat über 500 Livres von 1794 …   Deutsch Wikipedia

  • Fiat money — Heute sich im Umlauf befindende Banknoten und Münzen sind in der Regel Fiatgeld. Assignat über 500 Livres von 1794 …   Deutsch Wikipedia

  • fiat money —  Currency that has no intrinsic value. Fiat money is money because government declares it to be “ legal tender.” The danger with fiat money is that a government may decide to create too much of it, the most famous case being in Germany between… …   American business jargon

  • fiat money — money decreed by government …   English contemporary dictionary

  • fiat money — noun Money that is given legal value or made legal tender for money debts by government fiat …   Wiktionary


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