Actually currency is more a debt than an agreement.
When you have a 20 € bill, the European Central bank "owns you 20 €".
Since people have faith in the bank ability to pay its debt, everybody uses the note as money.
When you have a 20 € bill, the European Central bank "owns you 20 €".
Since people have faith in the bank ability to pay its debt, everybody uses the note as money.
What does it mean for the central bank to owe me 20 euros? Specifically, what do I get when they pay me what I'm owed?
If the answer is 20 euros....
While dollars were originally tied to physical assets, I'm asking about what the central bank give me today for my 20 euros or dollars.
What you get is the stuff that you buy. Or more directly, what you get is buying power.
The person who claimed otherwise disagrees - he said that it was a payable debt.
> You get nothing directly, but that's not the point
Except that it is. If the answer is "nothing", than a 20 euro note is nothing more than confidence in competence of the financial system.
While you may not see any alternatives to said confidence, that doesn't mean that it is justified.
How much confidence do you have in them?
20 € bill = currency (debt in paper) 20 € on your account = money