4 ms·
World GDP is $80T. An important fact: USD is world reserve currency. So no, I don't think that injecting, $6T is going to be super big deal. Just like in 2008,
by sytelus 7y ago
World GDP is $80T. An important fact: USD is world reserve currency. So no, I don't think that injecting, $6T is going to be super big deal. Just like in 2008, this additional money gets dispersed in to world economy or in other words the burden of US action gets transferred to other countries. This is precisely the reason why $2T injection has almost no effect on inflation within US but if any other country had dared to inject same proportion, it would have faced about 10% inflation making most of the imports pretty expensive for them.
- fg6hr 7y agoThis is the good old trick often done by startups: founders & investors create and generously give themselves a lot of shares, diluting the share of rank-and-file employees to zero. Here's some deep analysis from a armchair economist. $6T goes to the US "board members": their share of the company (I mean, the planet's resources) grows, but the share of rank-and-file American employees (I mean citizens), probably shrinks. My guess: $5T will be hoarded by the US elites, $1T will trickle down to citizens, the world's GDP will shrink from $80T to $50T and the US's GDP will shrink from $20T to $15T. If these hand wavy assumptions are correct, the US citizens' share will grow by 5%, from 20/80=25% to 15/50=30%, while the elites will get an extra 5/50=10% share of everything. Everybody outside the 12 mile zone around the US land is going to lose.