Patrick Elliott wrote:
> Doesn't change the fact that bottom up definitions, versus top down, 

Definitions of fiat on the Web:
an authoritative decree, sanction or order; a command or act of will that 
creates something without, or as if without, further effort; an arbitrary 
decree or order


You seem to be arguing that because the merchant has the choice of how much 
to charge, that makes what he's charging you fiat currency. That makes no 
sense. That's just isn't what the word means.

No more than "police" means "anyone who stops you on the street with a gun" 
or "elected politician" means "anyone who tries to convince you they're 
right."  The word has a definition. You're taking a completely orthogonal 
measure of value and trying to say that makes everything a fiat currency.

> And that is my point. For the people using that sort of, "I trust this 
> is worth X of Y commodity", whether it was feet in a mine, or physical 
> coin, you can become a pauper 500 times faster under such situations 
> that you would with a fiat system.

I don't think whether it's a fiat system or not has much to do with it. 
Observe Zimbabwe. Observe Iceland.  I don't really understand what sort of 
point you're trying to make, but "fiat currency is safer" is prima facia 
nonsensical.

If I have gold, certainly it will be worth less where lots of people have gold.

> Its not just a mad 
> rush of Caveat Emptor, followed by 3/4 the population finding they have 
> completely lost *everything* they own, over night, because they can't 
> afford to keep any of it and not starve to death.

Except that's *exactly* what happened in Iceland. And Zimbabwe. And war-time 
Germany. And etc.  Primarily because something like gold, while arbitrary, 
is recognized everywhere as valuable, while something like the currency of 
the Confederate States of America really has no value outside of the 
confederacy, and when the war is lost, so is the value.

Indeed, we even have a word, scrip, to indicate fiat currency that is 
intentionally of no value outside the very specific circumstances in which 
it is issued. You can't have a commodity-based scrip.

-- 
Darren New, San Diego CA, USA (PST)
  "How did he die?"   "He got shot in the hand."
     "That was fatal?"
          "He was holding a live grenade at the time."

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