Milton Friedman: Perfectly Worthless Paper
on Monday, November 30, 2015Milton Friedman Money Quotation saying The Federal Reserve puts ink to paper in a valueless way, as only government could. Milton Friedman said:
“Only government can take perfectly good paper, cover it with perfectly good ink and make the combination worthless” — Milton Friedman
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Milton Friedman is criticizing how governments can devalue or destroy the value of money through certain economic policies. By “perfectly good paper” and “perfectly good ink”, he is referring to currency like bills.
Friedman is suggesting that even though the physical materials used to make money have value on their own, governments have the unique power to render that money worthless simply through decisions around monetary policy, money supply, or other economic actions.
His point is that only a governing body, not private individuals or companies, can essentially wipe out the purchasing power and usefulness of a currency that physically appears sound, through policies that undermine its value and status as legal tender.
Birthday: July 31, 1912 Death: November 16, 2006