Of course there is a danger.
As long the money supply is carefully controlled and spent into the economy then inflation can be controlled. Time and again it is human greed and over producing at causes this cycle as the fed does now with the dollar.
Money created without interest added and carefully controlled supply is the key.
This was also why the Greenbacks introduced by Lincoln were also successful in exactly the same way. Again, after he was killed the banks hit back and got the Govt to remove 70% of the greenbacks from the money supply. Once again, recession was the consequence.
Ultimately, all economies fail due to human greed. Boom and bust has essentially become a game of make money and hoard it before another crash comes. But it is partly the hoarding that creates the problem. Keeping the money supply low for the many and keeping most of it in the hands of the rich.
Money was not meant to be used in this way. It is simply a tool to be used to make trading easier.
Money is like blood. It needs to flow to keep the body healthy. Blocking one part of this flow and the body dies. My other main point was regarding how the value of a nations currency is based on the health of the nation itself.
The argument between gold backed economy and nation backed economy from cheap created money - will go on for a long time. Ultimately the fact remains, it is the rarity of the coin that actually matters and the belief that it has value. If people though Gold had no value then there would be no difference between the two.
Bitcoin does not even exist other than numbers in vast computer network yet people see it as value.
However, at the moment it is being treated more like gold rather than a currency. People are holding onto it. But still, we all know that only a set amount of Bitcoins will ever be made due to its protocol. This ensures its rarity factor and the controlled supply factor.
Thanks for the comment.
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Lincoln's Greenback scheme was a disaster. Money should not be a monopoly.
It is the banks that have the monopoly.
The problem is that money isn't a thing that needs to be created. It is a commodity chosen by the market, not a governmental mandate. See Steem and Bitcoin as examples.
The government holding a monopoly is not a solution. The banks only hold a monopoly because the government monopoly in violence transferred a portion of its monopoly power to its corporate cronies.
No argument from me on this point.
I do not mean that the Govt should have control either.
My main point I wish to make is that at least when money creation is done by the Govt it does not have interest attached to it as it does when when banks create it. Creating a debt based economy from day one. We see now how with the creation of Bitcoin it has not debt attached to it and people are learning to take control of their own money effectively everyone becoming their own bank.
We have a long way to go as yet but I think with blockchain tech we are one step closer.
Thanks for the engagement!