[whatshisface]

The very concept of a currency peg is that you sell things in exchange for the currency when it is not valued highly enough, and buy things in exchange for it when it is valued too highly. It wasn't the implementation that is algorithmic, it was the idea of a pegged currency itself that made Black Wednesday inevitable.

If a national government can't maintain the value of their currency, they aren't backing it, and if they have so much gold that they can maintain the peg no matter what happens, it isn't fiat (the gold standard is where the government will sell and buy gold at a fixed price, printing or destroying currency in the process). So I would conclude that fiat currencies aren't backed by anything.