Currencies and Money
Money in the widest sense is currency in any shape or form, usually in use as a medium of commerce or circulating commonly accepted banknotes and coins as a form of payment. Money in this widest sense is usually issued by a country’s central government and is usually recognized by all nations as legal tender. There are different types of money that are used as money around the world. These are called “fiat” money.
Most modern governments issue banknotes in the form of coins for circulation that can be exchanged for other currencies, like the U.S dollar, British pound, etc. Many countries also issue virtual currencies known as “stock” currencies that are traded on electronic markets. Although these currencies are not considered to be a real currency, there are several differences between them and the “real” currencies that you know and rely on every day. For example, they are not backed by a country and they are not backed by any government, although they are usually electronically traded and are usually listed on stock exchanges.
Most countries, including the U.S. dollar, currently have a system of circulating fiat currencies so that the value of money within the country is not changed unless the people choose otherwise. This is called the gold standard. In some countries and some states within the U.S., the government can change the value of money instantly by putting it into a coin. For instance, if the government feels that the dollar will lose value because of something, they can immediately change the amount of money in floating fiat currency and have it change when the masses of people choose another currency.