I don’t see fiat as something the wizarding economy can jump straight to. First they have to be sold on the idea that money is a medium of exchange, and that the ability to exchange it is it’s primary value.
Representational money doesn’t have to be mono-metallic, it could represent a basket of metals,
or a basket of any commodities for that matter.
Oh, of course not. Harry’s arbitrage attack, assuming it happens at sufficient scale, will either shift or destroy the Galleon/Sickle/Knut pegs(edit: or, if Gringott’s has a bigger bankroll than the muggle economy, it’ll shift the muggle prices to the Gringott’s ratio), but it won’t cause the wizarding economy to go fiat. If nothing else, do you really trust Lucius Malfoy in charge of the Federal Wizerve? I just have this debate as it relates to RL politics on a regular basis, so I threw in the side note.
Edit: I should also add, a basket of commodities can work very well. That’s the method we use to calculate inflation, and it’s quite stable.
I don’t see fiat as something the wizarding economy can jump straight to. First they have to be sold on the idea that money is a medium of exchange, and that the ability to exchange it is it’s primary value.
Representational money doesn’t have to be mono-metallic, it could represent a basket of metals, or a basket of any commodities for that matter.
Oh, of course not. Harry’s arbitrage attack, assuming it happens at sufficient scale, will either shift or destroy the Galleon/Sickle/Knut pegs(edit: or, if Gringott’s has a bigger bankroll than the muggle economy, it’ll shift the muggle prices to the Gringott’s ratio), but it won’t cause the wizarding economy to go fiat. If nothing else, do you really trust Lucius Malfoy in charge of the Federal Wizerve? I just have this debate as it relates to RL politics on a regular basis, so I threw in the side note.
Edit: I should also add, a basket of commodities can work very well. That’s the method we use to calculate inflation, and it’s quite stable.