The fiat standard : the debt slavery alternative to human civilization

The Fiat Standard is Saifedean Ammous’s attempt to explain the technology behind the current analog global monetary system. Similar to how The Bitcoin Standard explained the functional essence of bitcoin and its potential social and economic implications, this book examines twentieth century monetary technology and explains its benefits and drawbacks, and its many modes of failure. The origin of government control of money came from the limitations on the spatial salability of gold, which required its centralization. The political control over central banks became effectively as good as gold in the central bank, because the gold could not be used for global trade without the political control supervising it. The intermingling of political authority and monetary media in central banks led to the conflation of money and government credit, and the widely-held misconception that credit can play the role of money satisfactorily. But such a system cannot survive the test of the market, and it has had to be enforced by government decree, or fiat, under pain of violence. Like any violent intervention in the market, this one has had consequences. As fiat has formalized and legalized the monetization of debt, it has made debt issuance analogous to the mining of gold under the gold standard; each new loan increases the supply of existing money. Whereas gold has a high stock-to-flow ratio that protects its supply from sudden increases, The Fiat Standard has little restraint on its ability to generate debt. The large global debt bubble unleashed in 1914 can only be understood as a consequence of the formalization of the monetization of debt. The use of government credit as a substitute for money is disruptive of the normal functioning of the market system and price mechanisms. Rather than consumer sovereignty and choice dictating the successful providers and the most efficient technologies, it is government Fiat, as embodied through favorable credit policies, which is sovereign in such matters. The book takes a thorough look at several of these areas of life and economy and the disastrous impacts of this distortion. Unlike government credit, bitcoin is a present good whose value does not depend on any counter-parties. Unlike gold, bitcoin is highly salable across space, allowing it to be spent across international borders without needing political supervision. As bitcoin rises while fiat money goes through another of its periodic crises, The Fiat Standard juxtaposes the two technologies and presents some foreseeable scenarios for how they can coexist into the future, or not. About the Author Supporters Foreword by Ross Stevens PART I: FIAT MONEY Chapter 1. Introduction Chapter 2. The Never-Ending Bank Holiday Chapter 3. Fiat Technology Network Topography The Underlying Technology Chapter 4. Fiat Mining Lending as Mining Deflation Phobia CPI and Unitless Measurement Inflation as a Vector Chapter 5. Fiat Balances: Universal Debt Slavery Unquantifiable Irreconcilable Tentative and Revocable Negative Fiat Savings Fiat Debt Chapter 6. What Is Fiat Good For? Salability Across Space Gold Spatial Salability Fiat Spatial Salability Bank Profitability PART II: FIAT LIFE Chapter 7. Fiat Life Fiat against Nature Fiat Time Preference Fiat Architecture Fiat Capital Destruction Fiat Family Chapter 8. Fiat Food Fiat Farms Fiat Diets Fiat Foods The Harvest of Fiat Sound Food Fiat Soils Chapter 9. Fiat Science Fiat Schools Fiat Universities Fiat Academics Fiat Science The Science Industrial Complex The Science Says Fiat Nutrition Science Fiat Hysteria Chapter 10. Fiat Fuels Fiat Apocalypse Fiat Thermodynamics The Cost of Fiat Fuels Chapter 11. Fiat States The Misery Industry Freedom from Accountability Development’s Ugly History A Real Impact Assessment Development Successes Chapter 12. Fiat Cost-Benefit Analysis Fiat Benefits Fiat Governments Conflict PART III: THE FIAT LIQUIDATOR Chapter 13. Why Bitcoin Fixes This Salability Across Space Separation of Money and Debt Antifiat Technology Neutral Global Currency Chapter 14. Bitcoin Scaling Hard Money Cannot Stay Niche Bitcoin Block Space Supply Second-Layer Scaling Lightning Network Trade-Offs and Risks Chapter 15. Bitcoin Banking Savings Technology High Cash Reserves Demonetizing the World Unbonding the World Robustness Full Reserve Banking Equity Finance Chapter 16. Bitcoin and Energy Markets Bitcoin Mining: Antifiat Technology Difficulty Adjustment: The Secret Sauce Bitcoin Fuel Chapter 17. Bitcoin Cost-Benefit Analysis Bitcoin Costs Bitcoin Benefits Is Bitcoin Worth It? Chapter 18. Can Bitcoin Fix This Government Attacks Software Bugs The Gold Standard Central Bank Adoption Monetary Upgrade and Debt Jubilee Speculative Attacks Central Bank Digital Currencies Acknowledgments Bibliography List of Figures Notes "In The Fiat Standard, world-renowned economist Saifedean Ammous applies his unique analytical lens to the fiat monetary system, explaining it as a feat of engineering and technology just as he did for bitcoin in his global bestseller The Bitcoin Standard. This time, Ammous delves into the world’s earlier shift from the gold standard to today’s system of government-backed fiat money—outlining the fiat standard’s purposes and failures; deriving the wider economic, political, and social implications of its use; and examining how bitcoin will affect it over time. With penetrating insight, Ammous analyzes global political currencies by analogy to bitcoin: how they’re “mined” whenever government-guaranteed entities create loans, their lack of inherent restraints on inflation, and the rampant government intervention that has resulted in heavy, devastating, and persistent distortions to global markets for food, fuel, science, and education. Through these comparisons, Ammous demonstrates that bitcoin could be our next step forward—providing high salability across space, just like the fiat system, but without the unchecked fiat-denominated debt. Rather than a messy hyperinflationary collapse, the rise of bitcoin could look like a debt jubilee and an orderly upgrade to the world’s monetary operating system, revolutionizing global capital and energy markets."