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Fiat becoming a farce

Were it not for ever-greater increases in central-bank money and the market expectation that governments are about to make taxpayers shoulder commercial banks' huge losses, the fiat money systems would presumably collapse right away.

International interbank short-term lending rates say it all: the latest drastic increases in yield spreads between money-market rates and official central-bank rates are indicative of the growing reluctance among banks to extend loans to each other, for fear that borrowers could default on their payment obligations

Under today's fiat-money regime, banks, under governments' auspices, increase the money stock "out of thin air" whenever they extend loans. The money supply is built on credit, which, in turn, hinges on peoples' confidence in banks and banks' confidence in their borrowers' ability and willingness to service their debt.

As confidence leaves the system, banks refrain from extending loans and demand repayment of outstanding loans, and the money stock contracts. Economies that have for decades been fuelled by ever-higher doses of credit and money fall into depression — that is, declining production, employment, and prices.

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i'm on board with mises

..but there are a lot of obamatronns pushing for socialism. they've obviously not studied history.