{"id":484,"date":"2006-08-24T12:53:42","date_gmt":"2006-08-24T16:53:42","guid":{"rendered":"http:\/\/www.forgetful.ca\/?p=298"},"modified":"2006-08-24T12:53:42","modified_gmt":"2006-08-24T16:53:42","slug":"what-makes-a-dollar-worth-a-dollar","status":"publish","type":"post","link":"http:\/\/forgetful.ca\/?p=484","title":{"rendered":"What makes a dollar worth a dollar?"},"content":{"rendered":"

Our dollar is a fiat currency<\/a>, meaning it is not ultimately exchangeable for anything (if, say, everyone wanted to trade in their dollars at the same time), and only has value because the Canadian government says it does.<\/p>\n

We get our paycheques, pay for everyday goods, and (most importantly) invest for our futures, all in Canadian dollars. We are comfortable doing this because our dollars aren’t losing their value very fast. The Bank of Canada diddles with the interest rates in order to keep the inflation rate (how fast the price of everything rises) at 2-3%. We are able to stay ahead of the game as long as our paycheques rise faster than the inflation rate. Nice and cozy, right?<\/p>\n

Well, there’s an ugly side to paper currencies. For a variety of reasons, Russia<\/a>, Argentina<\/a>, and most recently Zimbabwe<\/a> (as if Zimbabweans<\/a> need more things to worry about) have seen inflation rates in the thousands of percent. A loaf of bread goes up in price every day. Retirement savings that used to be able to sustain your for decades are now insufficient to buy cat food.<\/p>\n

I find these currency implosions fascinating. And while I don’t lose sleep worrying that the Canadian dollar will follow any time soon, I do think about alternatives to investing in Canadian dollars, or any other fiat currencies for that matter.<\/p>\n

Filthy money – makes you want to barter<\/a>, doesn’t it? How many ducks do you want for that jar of pickles? Tough for the government to tax that<\/strong> transaction …<\/p>\n","protected":false},"excerpt":{"rendered":"

Our dollar is a fiat currency, meaning it is not ultimately exchangeable for anything (if, say, everyone wanted to trade in their dollars at the same time), and only has value because the Canadian government says it does. We get our paycheques, pay for everyday goods, and (most importantly) invest for our futures, all in […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"ngg_post_thumbnail":0},"categories":[30],"tags":[],"_links":{"self":[{"href":"http:\/\/forgetful.ca\/index.php?rest_route=\/wp\/v2\/posts\/484"}],"collection":[{"href":"http:\/\/forgetful.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/forgetful.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/forgetful.ca\/index.php?rest_route=\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"http:\/\/forgetful.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=484"}],"version-history":[{"count":0,"href":"http:\/\/forgetful.ca\/index.php?rest_route=\/wp\/v2\/posts\/484\/revisions"}],"wp:attachment":[{"href":"http:\/\/forgetful.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=484"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/forgetful.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=484"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/forgetful.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=484"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}