"for many of the same reasons people trust Federal Reserve notes: they believe they can exchange the currency for goods, services or a national currency at a later date."
It's not that people have actual faith in the Federal Reserve. It's that they have no choice. Legal tender laws essentially eliminate any other form of currency as a legal means of exchange. See the Liberty Dollar case a while back as an example.
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Not Quite Correct
"for many of the same reasons people trust Federal Reserve notes: they believe they can exchange the currency for goods, services or a national currency at a later date."
It's not that people have actual faith in the Federal Reserve. It's that they have no choice. Legal tender laws essentially eliminate any other form of currency as a legal means of exchange. See the Liberty Dollar case a while back as an example.