If paper money , in real terms, worthless, why do we accept it?
551880
paper money used to be gold and silver certificates, which meant if you went to fort knox and gave them this paper money theyd give you its equivalent in gold or silver. now we dont need to do that anymore =)
425387
Historically, countries have overprinted their currency, leading to devaluation, and often, dire economic crises such as depression.  A careful balance must be struck to ensure that the money in circulation does not adversely impact the economy.
138878
Because there is not enough stored gold to guarantee the value of the currency in circulation. That is why the US went to the silver standard. Then we found out that there is not enough silver to guarantee the value of the currency in circulation. That is why US currency is now backed by "the full faith and credit of the United States."
1036667
Because money printed has to be backed by something else of value, like gold. Otherwise the money is worthless. It's the same reason that the U.S. mint doesn't print enough money to simply give everyone one billion dollars. They wouldn't be backed by anything and a jug of milk would cost a billion dollars.
526451
I think that drawing on any currency (paper, coin, etc.) isn't legal, because your defacing federal property.\n\nBut I don't think anyone really cares.  It's done so often, anyway.  The governments not going to arrest you for writing on a $5 bill.  I'm sure it's discouraged, as it should be, but most people have done it.
435004
If currency isn't in circulation, you can't spend it. That's pretty important to me!
364264
Your point is? Most have that in the banks.. But as cash.. I highly doubt any.
1143486
The money we have in circulation has served us for well over 100 years with very few modifications or changes... Why start now?  If it ain't broke why fix it?
193301
because money itself is not worth anything. It is just a symbol for perceived value.
454229
No, very little of the world's money is actually held as printed currency. Banks have the unique ability to create money, by taking people's savings and loaning them out. Depending on the banks required reserve rate (the amount kept for daily transactions) banks can create over $2000 from a $100 deposit.
661834
In 1933 the gold standard for money ceased.  Paper money was represented by silver for a little time after that. I vaguely remember my parents searching for silver certificates - dollars backed by silver - because the newspaper had a reward for them.  I don't know why some still think we're still on a gold standard.
776268
We say traditionally that money has four major functions. It is a\n\nMedium of exchange\n\n    Whatever people usually give in exchange for the things that they buy is the medium of exchange. As we have seen, this is the function that defines money. \n\nUnit of account\n\n    The unit of account is the unit in which values are stated, recorded and settled. The differences between this and the medium of exchange may seem subtle, but there are a few cases in which the unit of account is different from the unit in which the medium of exchange is expressed. In Britain a few decades ago, Guineas were often used as the unit of account, while the medium of exchange was expressed in Pounds. Both Guineas and Pounds in turn could be expressed in shillings -- the Pound was 20 shillings and the Guinea was 21 shillings. (British currency has since been redefined). \n\nStandard of deferred payment\n\n    This is the unit in which debt contracts are stated. Deferred payment means a payment made in the future, not now. Here, again, it is usually the same as the medium of exchange, but not always. During periods of inflation, people may accept paper money for immediate payment, but insist on some other medium, such as real goods and services or gold, for deferred payment -- because the medium of exchange would lose much of its value in the meanwhile. \n\nStore of value\n\n    Again, this is something that people keep in order to maintain the value of their wealth. Again, while it would usually be the same as the medium of exchange, in inflationary times other media might be substituted, such as jewelry, land or collectable goods. In this sense, money is "set aside" for the future. \n\nHope you did well on your exam!
132609
Why is there a thing like money?  What would you do instead to distribute goods and services?  A long time ago, people used to use barter a lot: trade one good or service for another.  But it is impractical to carry around what you produce in order to trade it with what they produce.  And what if A wants what B has, but B wants what C has, and does not need what A has?  So money came into existence to represent wealth, as a medium of exchange.  At first, it was made of precious metals that had a value relatively well known: an ounce of gold or silver had a pretty standard value in the community.  Now it is made out of paper, and no longer paper which can be exchanged for gold or silver.  We use it because we trust the next person will accept it, just like we did.\n\nActually, nowadays we more often use accounting records, created by computers, instead of the actual money.  So we are even deeper into symbolic wealth, rather than tangible wealth, like gold or silver or a barrel of pickles.
337353
Money is an idea, not a piece of paper. Most money is data stored in computers. The money in my bank account really isn't physical cash stored in a box in the vault, it's just numbers.
503309
Because society accepts it for payment of obligations.  Government endorsement helps, but is not sufficient.  In countries with weak currencies, alternate currencies form or other currencies are substituted.  In the US, over the last several years, organizations primarily in the West, have been printing silver depository receipts and they have been circulating them as tender for payment of goods and services.  They have had substantial support considering that there is no government or banking guarantee of the funds.  It is a warning sign of the failure of the "full faith and credit," to be accepted by Americans.
40029
I was wondering about this earlier today.  I think we're stuck with paper for quite a while since it's so cheap, but it's conceivable that we would eliminate it relatively soon.  Personally, I really like the idea of having something tangible in my hands with real pages that I can turn.  I was reading some Shakespeare today and I thought, "Wow, if I had a palm pilot, I could just download the text to it and I wouldn't have to waste paper or latch myself to my computer."  So what if one day we all went around carrying big sheets of plastic folded up like newspapers and whatever we wanted to read we could download to them?  Scientists are working on creating cheap, thin, clear "screens", so it's not entirely science fiction.  Paper will probably be around for a long time, but I think it would be interesting to look up whether paper waste has gone down even in recent years just with the popularization of the internet.
336828
First, it's worth it to say that no country uses the gold standard anymore.\n\nA gold standard is a money system in which the paper currency is worth a fixed weight of gold. In the U.S., back when dollars, half-dollars, quarters and dimes were really made of silver, nickels of nickel and pennies of copper (all precious metals), paper bills were actually Gold and Silver Certificates, meaning they were directly exchangeable for equivalent amounts of gold and silver, coins or otherwise.  \n\nEver notice that the edges of traditionally silver and gold coins are ridged?  This was to prevent people from "shaving" the coins, thereby reducing their weight and therefore, their value.  Remember, weight = value in the gold standard system.  A dime was 10 cents worth of gold/silver weight; a quarter, 25 cents worth of gold/silver weight, which accounts for the difference in size.\n\nUsing the gold standard means that there has to be enough gold in reserve to effectually "cash-in" all paper money in the system.  Fort Knox was and still is the United States' primary respository for gold.\n\nWhen a country abandons a hard currency system (i.e., the gold standard), it issues what is called a "fiat" currency.  Our Federal Reserve Notes are an example of a fiat currency.  This means that you can no longer exchange a paper note for gold or silver.  The value of our money is instead guaranteed by the government.  That's why our money states that it is legal tender for all debts public and private. That means that no one can refuse to accept a paper bill in payment for goods or services.  \n\nThat may not sound so ominous nowadays, but even back in the 1950's, I remember people who would adamantly refuse to accept change in fiat paper money (federal reserve notes).  The government really only facilitated the acceptance of federal reserve notes when it outlawed and recalled all Silver certificates in 1964.  All redemption stopped in 1968.  Gold Certificates were forfeit in 1933 and for a long time, except for collector coins, it was illegal for private citizens to hold gold or gold certificates.  \n\nSome currencies, like the U.S. dollar and the British Pound Sterling, because of their government's stability, eventually came to be seen as "hard currencies" in themselves.  Most other nations based or "floated" the value of their own currencies against the value of the U.S. dollar or the British Pound Sterling.\n\nTwo good sites to peruse about money and money systems are http://en.wikipedia.org/wiki/Fiat_currency\nand\nhttp://www.ronscurrency.com/