The Lifecycle of the Substitute and Its Purchasing Power, 5

On the part of the issuer, the agreement to give fiat debt money out of nothing in exchange for existing purchasing power is obviously fraud and robbery; as of the party accepting to give existing purchasing power in exchange for fiat debt money out of nothing, that agreement ought be out of gullibility, ignorance, manipulation, swindle, duress, connivance to the detriment of third parties. Inspecting it more closely at this point, I intentionally call this money “fiat debt” so as to highlight and study these as two distinct features, before studying them together.

Fiat: If a fiat money without intrinsic value is issued against a promise of future delivery of purchasing power, such as in the case of a government, business, individual, committing to use the purchasing power received in exchange to produce and deliver something useful, that would assimilate it to the previous case of debt/credit: that money would be a debt for the issuer, and the issuer were committed to repay it; the face value of that money would represent that of future production the issuer committed to deliver. But we do know things are usually quite otherwise: fiat money is issued and exchanged with actual purchasing power without any commitment of any future valuable production and delivery on the part of the issuer whatsoever, not the slightest trace of it. So: if fiat money issued against a commitment of future delivery is a debt on the part of the issuer, and a credit for the other party that accepts it giving existing purchasing power in exchange, what is that fiat money when issued against nothing, without any such commitment? Exactly: a gift. The existing purchasing power exchanged with commitment free fiat money is no more a credit; it is a gift, lavished on the issuer by the party accepting that money, because the purchasing power given in exchange will never have to be paid back by the issuer.