Until 1971, the U.S. economy was governed by the gold standard, meaning each dollar in circulation was supported by gold in the Federal Reserve. However, this standard was fictitious since, as the U.S. economy expanded, the government began to issue more dollars beyond the capacity of its reserves. This discrepancy of collateral value against the circulating monetary asset, the dollar, caused the U.S. government to abandon the gold standard because it couldn’t afford to pay for what it repres...