“When you have a system based on credit rather than bullion deals are never completely done. Instead, everything depends on the good faith and good judgment of counterparties – including everybody’s Number One counterparty: the US government. Its bills, notes, and bonds are the foundation of the money system. But they are nothing more than promises. A credit system cannot last in the modern world. Because as the volume of credits rise the creditworthiness of the issuers declines. The more they owe the less able they are to pay. As time goes by, the web of credit spins out in all directions, entangling not just the present, but the future too.”

http://www.equitymaster.com/dailyreckoning/detail.asp?date=07/22/2013&story=1&title=Can-a-credit-system-last-in-the-modern-world

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