Life cycle of fiat currencies and viability of the alternative currency systems

Abstract

Fiat money, the money that is not backed by any real good or commodity, accepted newlineas a command from authorities, is perceived by many to have achieved economic newlinejustice but has actually failed in many respects to foster equity and justice to the newlineeconomic structure of our society. The string of economic crises that the world has newlinewitnessed after the inception of elastic money, testifies its incapacity of running a newlinejust monetary system. Though generously discussed in the monetary economics, fiat newlinemoney in particular remains obscured and neglected in the mainstream literature with newlinerespect to its shortcomings. Drawing from the inadequacies in the literature, this newlinestudy strived to discuss life cycle of the fiat currency systems both historically and newlineconceptually. This research additionally adopted a quantitative approach to newlineinvestigate the relationship between the elastic money growth and the loss of general newlinepurchasing power and between money growth and asset prices. This comprehensive newlineresearch effort has endeavored to help understand the current monetary system at the newlinegrass-root level. newline