Throughout history, the concepts of abundance and scarcity have shaped our understanding of economics, influenced the allocation of resources, and ultimately driven human behavior. Items or attributes that were considered scarce commanded a premium, whereas items that were abundant typically didn't carry as much "inherent" value. But, while it may seem counterintuitive, the two concepts are inextricably linked…especially when it comes to the fiat we use to measure value in the modern world.

The Illusion of Abundance in Fiat Currency

Fiat currency, the paper money we use daily, is created by governments and central banks without being backed by anything of value. This system allows for an essentially unlimited supply of money—governments can print, or digitally create, as much of it as they want. On the surface, this seems like abundance: more money in circulation, more opportunities for spending, investment, and growth, right? In fact, the opposite is true.

Since 1971, when the U.S. dollar fully decoupled from the gold standard, the money supply has exploded. According to the Federal Reserve, the U.S. M2 money supply (a measure of cash, checking accounts, and other liquid assets) grew from $4.3 trillion in 1990 to over $21 trillion by 2023. Central banks worldwide, from the European Central Bank to the Bank of Japan, have followed suit, printing money to stimulate economies, bail out industries, or manage crises like the 2008 financial crash or the COVID-19 pandemic. This flood of currency has led to a strange paradox (for those who have not spent the time to dive in on fiat): the greater the abundance of money, the less value each dollar in circulation represents. Let’s explore why.

The Scarcity of Value in an Abundant Money System

When money is printed in large quantities, a few things happen that erode value:

Inflation Erodes Purchasing Power - The most direct consequence of an abundant money supply is inflation. When there’s more money placed in circulation chasing the same amount of goods and services, prices rise. The U.S. Bureau of Labor Statistics reports that the purchasing power of the dollar has fallen dramatically over decades—what cost $1 in 1971 would cost over $7 in 2023. This means the value of your money, its ability to buy real goods like food, housing, or energy, becomes scarcer as the money itself becomes more abundant.

Asset Bubbles and Misallocation of Resources - Newly minted (or created out of thin air) fiat currency often flows into speculative assets like stocks, real estate, or cryptocurrencies, driving up their prices beyond their fundamental value. For example, the S&P 500 index has soared since the 2008 crisis, partly due to low interest rates and quantitative easing…another fancy term for money printing. While this creates a sense of wealth for investors and Cantillonaires (more on them in my next blog, in the meantime these are the people positioned closest to the money printer), it doesn’t reflect real economic productivity—it’s just more dollars chasing the same assets. Meanwhile, essentials like housing become unaffordable for the average person, those of us further from the money printer. This has become obvious to anyone paying attention these past few years, especially in cities like San Francisco, where median home prices exceed $1.3 million as of 2023. The abundance of money ultimately results in a scarcity of access to basic needs.

Devaluation of Labor and Savings - When fiat currency floods the system, the value of labor and savings diminishes diminishes as well. Workers exchange their precious time and life energy, the only thing we possess that is perfectly finite, for fiat money the Cantillonaires print out of thin air. And as Jack Mallers has stated, no man should work for something that another man can print. But, since most do exchange their productive lives in this very way, they inevitably find that their wages don’t keep up with inflation—U.S. real wages (adjusted for inflation) have barely grown since the 1970s, according to the Economic Policy Institute. Savers, meanwhile, are punished by near-zero interest rates, a byproduct of abundant money policies. In 2022, with U.S. inflation at 8% and savings account rates below 1%, savers lost real value just by holding cash. The abundance of fiat makes the value of hard work and prudent saving scarcer. When the Cantillonaires fire up the money printer, they are essentially driving scarcity of our life energy through the silent theft that is inflation.

Global Impacts: Currency Wars and Inequality - On a global scale, the abundance of fiat currency in one country can lead to scarcity of value elsewhere. When the U.S. prints dollars, it exports inflation to countries that hold dollar-based assets or rely on dollar-priced commodities like oil. In other words, other countries are forced to hold petrodollars because the bulk of the oil market is denominated in US Dollars. Meanwhile, many nations simply used the US Dollar as their underlying thing of value, like the US did with gold prior to 1971. Imagine what happens to their currency when the underlying peg is being debased, similar to a home being developed on a foundation of quicksand. These developing nations, already strapped for resources, face a scarcity of purchasing power as their currencies inevitably weaken as a result. At the same time, this system widens inequality—those Cantillonaires closest to the money printer (i.e. banks, elites, and governments) benefit first, while the average person feels the pinch of rising prices later. The Oxfam 2023 report highlighted that the top 1% captured nearly half of all global wealth gains since 2020, a trend exacerbated by fiat abundance.

The Philosophical Angle: Scarcity Drives Value - At its core, value has always been tied to scarcity. Gold is valuable because it’s relatively rare and hard to mine. A Picasso painting fetches millions because there’s only one of it. When fiat currency becomes abundant, it loses its scarcity, and thus its value. This is why hyperinflation scenarios, like in Zimbabwe in 2008 (where inflation hit 79.6 billion percent) or Venezuela in 2018 (peaking at 1.7 million percent), render money worthless—people need wheelbarrows of cash to buy bread. The abundance of money creates a scarcity of what money can actually do, store value and be a consistent unit of measure.

Contrast this with a system, or protocol, designed for scarcity, like Bitcoin. With a fixed supply cap of 21 million coins, Bitcoin’s value proposition is rooted in its absolute scarcity—there will never be more, no matter how much demand grows (unlike gold where more can be mined if the price provides enough incentive to ramp mining efforts). As of April 2025, Bitcoin’s price has hovered around $90,000, partly because its scarcity provides a hedge against the abundance of fiat, illustrating how scarcity preserves value in a way fiat cannot.

So What Can We Do?

The abundance of fiat currency and the resulting scarcity of value aren’t just abstract economic problems—they affect our daily lives in the fiat matrix. Below are a few of the suggestions you might hear from tradition finance market participants…those who's roles are staked to fiat.

You should continue to stake yourself by simply investing your hard earned fiat into harder, real assets. Since everyone seems to recognize by now that holding cash is a non starter because it will lose value every year by design, you could consider assets that tend to hold up against inflation, like real estate or precious metals.

While fleeing the erosion of fiat for harder assets, you can support sound money policies by advocating for fiscal responsibility from governments and central banks. This is what the elites who control the matrix will tell you to do, because it is a worthless endeavor and is just you staking yourself ever harder to a system which is working as designed (to our detriment). Pushing our elected officials for policies that limit money printing to help preserve fiat's value is a romantic notion, however fiat requires infinite money printing to persist.

Then they might tell you to consider diversifying globally, as though you can somehow outrun inflation by shifting into other currencies or assets that are controlled by different third parties, all of which will continue to hit the print button. If you’re in a country with a weakening currency, look into holding assets in a stronger currency. But, in a fiat world, the only answer to which currency is the strongest is Bitcoin…there is no second best.

Beyond the fiscal and monetary concerns I've outlined, we must all continue to focus on the source of true abundance, our personal relationships, knowledge, and experiences hold more lasting value than any store of value can. The currency of life is actually the acquisition of experiences, which inflation can never touch. As we begin to tackle an abundance of fulfillment through our experiences, we should also be stacking sats (converting fiat to Bitcoin). If there is a button to turn on an endless money printer, you can trust that humans will undoubtedly press it, for the fiat matrix requires it to continue. By exchanging something that is abundant vs something which is absolutely finite, we are simply leveraging laws of nature and math to store our life energy in something more valuable.

For the dynamic between abundance and scarcity reveals a harsh reality about fiat currency: when money becomes too abundant, the value it represents becomes scarce. This is a feature of fiat, not a bug…a feature which fuels inflation, widens inequality, and erodes the purchasing power of everyday people. We must free ourselves from the distractions provided by the Ministry of Truth and, instead, engage in conversations about these systemic issues, encouraging our our friends and family to think critically about the money they use and how they are being robbed of their precious life energy. In a world drowning in fiat, we must unsubscribe and break our stake in order to refocus humanity on fulfillment, the true abundance in life.

Jake Galt