> Once again, there is no difference between checkbook
> dollars [what you call — not incorrectly — virtual
> money] and paper dollars.
Ah, but there is. You control paper money in your possession. You do not control checks, credit or other instruments. Other people, corporations, and the government does. Any of them can simply refuse it to you.
Likewise, when you purchase something, whoever sells it to you does not have to take credit, debit, or checks. But once the transaction has been made, they *must* take paper money.
Right now, many banks and major retailers are trying to phase out personal checks, because they are expensive to them to process. This leaves credit and debit, which are totally in the province of the issuers and underwriters. If they decide to withdraw your credit they can, and there is nothing you can do about it.
If there is a bank holiday, you might have a million dollars in the bank and have access to none of it. If there is a “cash run” on banks, they would be emptied of paper currency in just a few hours. They would be unable to provide funds except virtually, to *another* such institution. Not you.
While the government might effectively cause hyperinflation, and say that virtual money is the same as paper money, it cannot back that argument. If a retailer is willing to sell you $10 worth of merchandise for cash, yet refuses a check for $10,000, it is all the difference in the world.
After the stock market crashed in 1929 my grandmother had a loan on three houses, rented two out and lived in one. She also had quite a lot of money in the bank. Her bank closed and she did not ever get her money back, but the bank sold her notes on the property to another bank that stayed in business so eventually when she couldn’t pay her payments the houses were foreclosed on.
My grandmother went from being pretty well off to being a penniless, homeless widow with 4 children practically overnight.
If that were the case, then you'd be right. But that situation doesn't exist and if we reach that point, then all confidence in the government -- and therefore its money -- will have been lost.
Paper dollars are intrinsically worthless. Their purchasing power is based on faith alone. I wish you luck hoarding your paper dollars. I really wish you'd sell them for some gold, though, instead.