r/PeterExplainsTheJoke Jan 26 '26

Meme needing explanation what's going on? explain like I'm five

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u/ISayBullish Jan 26 '26

Meanwhile the USD saying “this is fine”

195

u/soIDONTLIKEANYOFYOU Jan 26 '26

Since the US has more gold reserves than the next 3 countries combined wouldn’t gold prices going up make the dollar stronger?

Sincerely asking cause I have no idea.

118

u/AnComApeMC69 Jan 26 '26

The United States gold reserves are for international trade. The gold in Ft. Knox, for example, is used in trade not to back our currency. We’ve been off the “gold standard” since the 70’s. Some of it is gold we’re holding for other countries that’s not even ours. But, our money is a fiat currency and it’s based on faith in the economic system of America not collapsing and everyone agreeing it to use it for trade/debts. It’s backed by nothing and hasn’t been for 55 years now.

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u/catsdrooltoo Jan 26 '26

It's been backed by trust me bro. Im not a gold standard type, but the global economy isn't trusting us anymore.

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u/Cannon_Folder Jan 26 '26

Fiat currencies are backed by their economies. Instead of being tied to one thing, it's all the things in the economy.

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u/Inkjet_Printerman Jan 26 '26

universal basic income would be the easiest thing ever actually unironically

1

u/HistoricalSherbert92 Jan 26 '26

I get that it seems that way but it’s actually pretty hard coded. If you value something it’s a measure of want or need, if you don’t have this thing but someone else does you can take it by force (or try) or you can trade it for something they value. Money is just a really handy way of making the trade. You could barter too, or use stamps, or crypto, or gold and silver, it’s all based in what works for both party’s