Based on a survey, Americans are getting more and more worried about inflation as the Federal Reserve’s money printers go into the complete brrr mode, according to a new survey – despite the fact that 29% are still drudging under the illusion that the greenback is always backed by its good friend, Gold.
These were the results of a report carried out by hashpower provider Genesis Mining. The firm quizzed 400 Americans on their views on July 28, asking them about their understanding of the financial system, their trust of financial institutions, and beliefs about money – as well as their views on bitcoin (BTC) and other cryptoassets.
As the United States is looking forward to fighting back against a coronavirus pandemic-induced recession, the survey respondents said they were concerned that government money-printing efforts would spark inflation, with 73% agreeing that the government had “added” money to help fight COVID-19. Over half stated that they were “somewhat concerned” by the prospect of dollar inflation, with a further 35% saying they are now “very concerned.”
During this month, the Fed stated that it would keep the introductory interest rate in the range of 0% to 0.25% until the labor market has reached the Fed’s definition of “maximum employment,” and the inflation rate has risen to, and remained above, 2% “for some time.”
The central bank justified its plan of allowing inflation to move above 2% by saying that inflation has been “running persistently below” the previously stated long-term goal of 2%. As a result, a temporary jump in inflation is needed to get back to this long-term goal in the Fed’s view.
Asked about the assets that backed the USD, the largest share of respondents answered they thought the currency was supported by the United States government, at 42%, while almost three in 10 thought gold underpinned the USD.
President Richard Nixon put an end to the gold standard back in August 1971.
The Genesis Mining report authors wrote,
“42% [of respondents] answered that it’s backed by the US Government, which is up from 30% last year. But 28.5% said it was backed by gold, which is about the same percentage as our survey last year — which we now know is incorrect — and the remaining 30% answered that they thought it was backed by either oil, bonds, or nothing, or they just didn’t know.”
Last year’s Genesis Mining survey yielded similar results regarding gold’s perceived role in backing the USD, with 29% of respondents saying they thought the currency was gold bullion reserves.
There were also some direct responses as to what people believe supports the greenback: 12.8% confessed that they “don’t know,” what backs the USD, over 7% said they thought “nothing” underpinned the currency – while smaller numbers suggested bonds (5%) and oil (4%).
When asked what their thoughts were regarding Bitcoin (BTC) and cryptocurrency, the most massive response at 35% was that it’s an “interesting idea that may have potential but too early to tell” — even though Bitcoin was created in 2008.
According to the authors of the survey, “there’s a great opportunity to educate others about where their money comes from and where it goes, how banking systems work, and how Bitcoin and cryptocurrency can play a major role in elevating and advancing our usage of money going forward.“