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This is one of two last-resorts mechanisms by which the U.S. will maintain its hegemony. It may suck, but it is way better than the alternative.
by DSingularity 6y ago
This is one of two last-resorts mechanisms by which the U.S. will maintain its hegemony. It may suck, but it is way better than the alternative.
- Consultant32452 6y agoWhat's the other last resort? WWIII? It seems that's brewing too.
- duxup 6y ago>by which the U.S. will maintain its hegemony By printing money?
- aeternum 6y agoWhy is printing money a bad thing at this point in time? I see two strong reasons that printing money is the right move: 1) Wealth inequality is high relative to recent history. Printing money is a very effective way to even some of that out. Possibly the only form of 'wealth tax' that can actually be executed successfully. 2) The US debt / GDP fraction is still relatively low compared to many other countries.
- criddell 6y ago> The US debt / GDP fraction is still relatively low compared to many other countries. Is the relative ratio a good way to evaluate it? Does it mean anything to talk about the debt:GDP ratio in isolation?
- aeternum 6y agoGDP is somewhat close to a nation's income. Those with higher incomes can typically safely afford larger loans.
- criddell 6y agoSo what would be different between two similar countries, one with a debt:GDP ration of 0.1 and the other with a ratio of 2? Is the only difference that the first country has more options in a time of crisis?
- aeternum 6y agoThe country with the ratio of 0.1 can pay off its debt 20x more quickly/easily. Much less risky of that country defaulting.
- cheald 6y ago> Printing money is a very effective way to even some of that out. Possibly the only form of 'wealth tax' that can actually be executed successfully. This only holds if the wealthy are holding their wealth as USD, not assets. This is not the case. The wealthy do not typically have Scrooge McDuck-style vaults of cash laying around waiting to be inflated away.
- aeternum 6y agoThe wealthy do not typically have vaults of cash, but they do invest most of their money in companies which often do have large USD reserves. The vast majority of their wealth is greatly impacted by the relative value of USD.
- blawson 6y agoInflation hurts the poorer the most - they don't have assets that are being priced up due to inflation, while the cost of everyday life goes up.
- WanderPanda 6y agoBut their debt might devaluate?
- aeternum 6y agoThis also may not actually cause inflation. The QE performed by the fed during the 2008 financial crisis did not create much inflation.
- throwanem 6y agoAttempt to maintain.