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Used to as in when the currency was gold backed and not really fiat, you mean? Sure, but that also didn't work very well. Loans in a fiat currency are not limi

by kqr 5y ago

Used to as in when the currency was gold backed and not really fiat, you mean? Sure, but that also didn't work very well. Loans in a fiat currency are not limited by reserves. If there is high demand for money, private institutions will lend money and then borrow reserves at whatever rates they get to cover the difference.

WalterBright 5y ago
> Used to as in when the currency was gold backed and not really fiat, you mean? Sure, but that also didn't work very well. There was no net inflation from 1800-1914, and endemic inflation ever since.