Common type of currency issued by official order, and whose value is based on the issuing authority's guarantee to pay the stated (face) amount on demand, and not on any intrinsic worth or extrinsic backing. All national currencies in circulation, issued and managed by the respective central banks, are fiat currencies.Note the use of the terms "official" and "authority," which are legalese for "government" and "law." Most Americans place great faith in both the government and law -- so much is at stake in our political economy...
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