LDOne, the dollar HAS been toilet paper ever since August 15, 1971, when Richard Nixon divorced the United States Treasury from both the Silver and Gold Standards, making the Dollar backed by...NOTHING! The money in your wallet is nothing more than paper.
LD0ne - October 16, 2009, 3:54 pm,
actaully its made outta cotton fiber
Treehodger - October 16, 2009, 6:15 pm,
Money is backed by "Trust". We all agree that a $5 bill is actually WORTH $5, and therefore USE it to represent $5. This may sound like a no brainer, as 5 = 5. But because we value other money, such as Pesos, differently we are able to make a "Value".
Zed - October 17, 2009, 2:57 am,
But that is "Fiat Currency" and has only the value people place upon it.
Zed - October 17, 2009, 2:58 am,
Holland had such a currency in place a few hundred years ago, and it resulted in a market crash (in 1636) once folks realized that their currency had no intrinsic value besides someone in authority saying "This bill is worth THIS much".
manicbranic - November 19, 2009, 1:47 pm,
At the end of the day, the competitiveness of American goods and services determine the value of the dollar. The medium of exchange itself doesnt necessarily need to have much intrinsic value. As long as the currency is the denominator of value of ....
manicbranic - November 19, 2009, 1:53 pm,
American output, and output is internationally competitive, the currency will hold its value. Exchange rates were an indicator not a cause of the recession. The real problem was obviously bad debt, which had to do more with stupidity than anything else.
Ed-Hyde - November 19, 2009, 2:20 pm,
Its the output holding its value that I'm a little worried about. Bad Dept plus frozen lending, even to qualified buyers, plus bad government policy, both from bush and obama. Solution, base the dollar on the double stuf Oreo ftw!