Loss of Backing
A fiat-money currency generally loses value once the issuing government or central bank refuses to further guarantee its value, but this need not necessarily occur. For example, the so-called Swiss dinar continued to retain value in Kurdish Iraq even after its legal tender status was withdrawn by its issuer, Iraq's central government.
Read more about this topic: Fiat Money
Famous quotes containing the words loss of, loss and/or backing:
“Upset at the young wife’s
first loss of virtue
in a riverside thicket,
a flock of birds
flies up,
mourning the loss
with their wings.”
—Hla Stavhana (c. 50 A.D.)
“I could lecture on dry oak leaves; I could, but who would hear me? If I were to try it on any large audience, I fear it would be no gain to them, and a positive loss to me. I should have behaved rudely toward my rustling friends.”
—Henry David Thoreau (1817–1862)
“Better risk loss of truth than chance of error—that is your faith-vetoer’s exact position. He is actively playing his stake as much as the believer is; he is backing the field against the religious hypothesis, just as the believer is backing the religious hypothesis against the field.”
—William James (1842–1910)