Investor Glossary-fiat moneyInvestor Glossary-fiat moneyInvestor Glossary-fiat moneyInvestor Glossary-fiat moneyInsightful stock market charts - Click here
investor
Categories    # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Fiat Money

The HTML to link to this page
 

Fiat money is currency that cannot be redeemed for a commodity with intrinsic economic value. Fiat money only has value by government fiat, or decree. Thus, fiat money holds its worth only as long as users believe they will be able to exchange it for goods or services. Most currencies in the world today are fiat money. Historically, most money was not fiat money. Currency that is not fiat money could be either an item of value itself, such as silver coinage or be a note redeemable for something else of value. The gold standard is an example of the latter. Fiat money gradually replaced asset-backed currency because of the many cycles of inflation and deflation that occurred in the 18th and 19th centuries with redeemable currency. Today, most fiat money currencies are traded in the foreign exchange market. While in some sense a given national currency is still strictly labeled fiat money, in practice it is thus redeemable for not only one other commodity, but many - other (mostly fiat money) convertible currencies.



Rate this fiat money definition...

Learn about investing with the Investor Glossary Term of the Day


Click here for insightful stock market charts. Where is the market headed? The answer may surprise you. Find out
with the exclusive & Barron's recommended charts of Chart of the Day.


Popular Terms: reverse mortgage, current ratio, phantom income, APR, limit order, class C shares, labor relations, diluted share, covered put, dividends payable, debt service coverage, option premium, per diem, irrevocable trust, stock split, inflation, cancelled check, risk management, required rate of return, 1035 exchange, FICO score, 144a, minority interest, Key Rate Duration, average price per share, deferred revenue, liquidity ratio, command economy, annual return, LIBOR, quality assurance, VIX, ex-dividend, ex-dividend date, open position, in escrow, wholly-owned subsidiary, EBITDA, implied volatility, retained earnings, balance sheet, deferred tax, margin rate, 1031 exchange, Zero Cost Collar, FTSE, stock market close, 401a, real GDP


Investor Glossary | Term of the Day | Suggest a Term | Chart of the Day | Dogs of the Dow
Investor Glossary Index >>> # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
Accounting | Banking | Bonds | Brokers | Economy | Futures | Mutual Funds | Options | Real Estate | Retirement | Stocks | Taxes | Technical Analysis
©2004-2014 Investor Glossary - All rights reserved - Terms of Use