- a command or act of will that creates something without or as if without further effort
- an authoritative determination : dictate
- an authoritative or arbitrary order : decree
Why this word ("fiat"--which, by the way, has the same root as the word "faith") did not send up more red flags at its inception is beyond me. When God warns us not to trust in riches, He speaks in terms of gold. For instance, Job says,
If I have made gold my hope, or have said to the fine gold, Thou art my confidence;Elsewhere in the scriptures, wealth is referred to in terms of silver or bronze... or horses and chariots! The point is not that gold alone (the yellow stuff--element "Au" in the periodic table) should be used as money, but rather that whatever we use for money should have real historical value, not an artificial and dictated value which is sure to evaporate quickly. If we are not to trust in precious metals like gold--which have been used for 6000 years as money; that which (in my opinion) God has given to us for the very purpose of mediating exchange--how much less should we trust in the arrogant and blasphemous idea that man can speak value into existence?
If I rejoiced because my wealth was great, and because mine hand had gotten much;
If I beheld the sun when it shined, or the moon walking in brightness;
And my heart hath been secretly enticed, or my mouth hath kissed my hand:
This also were an iniquity to be punished by the judge: for I should have denied the God that is above.
It would be bad if they thought they could ascribe the historical market value of a precious metal to some other less-valuable metal. Of course, they did do that. That is the reason why dollars are no longer silver and pennies are no longer copper. It would be worse if they thought they could declare valuable some unlimited resource such as wood (or something derived from it). Of course they did that as well. These actions were heinous, but what if they commanded value into something even less valuable than paper? Yes, this has also been done (with digits).
We can't predict exactly how long human fiat decrees can stand, but we can happily know that they are but a vapor and will be exposed and extinguished.
This an excellent interview of a former Director of the Federal Reserve (2 minutes):