What is Sound Money?

Sound money is honest, stable money backed by tangible commodities such as Gold, Silver or Platinum. Sound money has an intrinsic value that has purchasing power determined by the market and is independent of governments and political parties. In general, it is not liable to sudden depreciation or appreciation in value.

The usual meaning is, “pertaining to coins or currency, or having to do with money”, but it has been held to include personal property. A commodity money system is a monetary system in which a commodity such as Gold or Silver is made the unit of value and physically used as money. The money retains its value because of its physical properties (intrinsic value). The alternative to a commodity money system is fiat money, which is defined by a central bank and government law as legal tender even though it has no intrinsic value.

Paper money is any legal document that displays or carries a monetary value such as promissory notes, cheques, postal orders, cash, bank drafts and other bills of exchange.

FIAT Currency is a generally accepted form of money, including coins and paper notes, which is issued by a country’s Central Bank and circulated within an economy. Used as a medium of exchange for goods and services, currency is the basis for trade and commerce. It has face value but no intrinsic value and is often printed without reserve or limitations.