From Critiques Of Libertarianism
Libertarians generally complain about "fiat money" (paper money), and divide into gold or bitcoin camps. At this time, gold is simply a commodity: do gold standard libertarians want a government fiat to make it the currency?
- Bitcoin (42 links)
- Bitcoin is a classic private currency scam. It fails to offer stable values, security from theft, privacy from government and ease of use. With prices near $17,000 per bitcoin (Dec. 2017), it is in a huge speculative bubble. It has enormous problems with transaction bottlenecks, transaction costs, and electricity usage compared to alternatives such as Visa.
- Fiat Money (2 links)
- Fiat money (or fiat currency) is a genuine economics term that applies to all the dominant currencies in the world. Libertarians hate the idea that currency has value because government says so, and use the term derisively. They would prefer to switch to gold or bitcoin or some other non-governmental scheme.
- Fractional Reserve Banking (3 links)
- A huge bugaboo of Austrian economists such as Murray Rothbard. They claim it is essentially fraud and embezzlement, and that a 100 percent reserve gold standard is the necessary alternative.
- Gold (5 links)
- Austrians tend to spout weird theories about depressions being due to "fiat money", and how the one, true currency is gold which will solve all those problems. Ayn Rand fans mimic her fetish for gold in "Atlas Shrugged". Despite the fact that most of the world operated on the silver standard for centuries, and the gold standard was due to government fiats in the 19th century.
It is unfortunate that the kind of computing Bitcoin pioneered has been given the name "cryptocurrency", and has been associated with all sorts of technofinancial scheming. When you hear "cryptocurrency", don't think of Bitcoin or money at all. Think of Paul Krugman's babysitting co-op. Cryptocurrency applications deal with the problem of organizing people and their resources into a collaborative enterprise by issuing tokens to those who participate and do their part, redeemable for future services from the network. So they will always involve some kind of scrip. But, contra Bitcoin, the scrip need not be the raison d'être of the application. Like the babysitting co-op (and a sensible monetary economy), the rules for issue of scrip can be designed to maximize participation in the network, rather than to reward hoarding and speculation.
Steve Waldman, "Econometrics, open science, and cryptocurrency"
Why do people on the right hate monetary expansion, even when it’s desperately needed? One answer is the power of truthiness -- Stephen Colbert’s justly famed term for things that aren’t true, but feel true to some people. “The Fed is printing money, printing money leads to inflation, and inflation is always a bad thing” is a triply untrue statement, but it feels true to a lot of people. And, yes, a tendency to prefer truthiness to more complicated truth is and pretty much always has been associated with political conservatism, and this tendency is especially strong in an era when leading politicians get their monetary theory from Ayn Rand novels.
Paul Krugman, "The Deflation Caucus"