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> pay it in fiat, which only has value if other people think it has value. That's not correct. The value of fiat currency is pinned to the production output of
by rumanator 6y ago
> pay it in fiat, which only has value if other people think it has value.
That's not correct. The value of fiat currency is pinned to the production output of an economy due to the fact that taxes are exclusively paid with it.
- smabie 6y agoYes, the people in the government assign it value. How is that different from what I said?
- rumanator 6y ago> Yes, the people in the government assign it value. No, they don't. At most "the people in the government" set rules that define the conversion rate between the domestic product and your contribution, which is expressed in fiat currency. No one states on a whim how much a unit of currency is worth. The process is not arbitrary. The only parameter that's arbitrary is the percentage of your anual production that you are obliged to pay the state.