3 ms·

> It's really hard to default when your debt is in your own currency. That’s true, but it misses the point because printing money is debasing your currency, no

> It's really hard to default when your debt is in your own currency. That’s true, but it misses the point because printing money is debasing your currency, not defaulting on debt. And if it’s true that borrowing $x billion and printing money can be done without consequences ‘almost indefinitely’, then why stop at x? Why not 2x, or 10x, or 1000x?

epistasis 6y ago
I think that is the point though, that the very worst that can possibly happen is hyperinflation. Why not stop at 1000x? That's the entire point of the article, we don't know the situations that set off currency debasement well enough. We all assume that there will at least be some period of normal inflation first, before we get to hyperinflation though. When we have become the global currency, there is also great risk when we do not have enough dollars and treasury bills out there. Because the world's savings are pretty much equivalent to our "debt." As there is more wealth in the world and as more of that wealth is held in US dollars or in US T-bills, if we do not continue to deficit spend, or somehow get more money supply, there are other risks too.
rubyn00bie 6y ago
> That’s true, but it misses the point because printing money is debasing your currency, not defaulting on debt. > And if it’s true that borrowing $x billion and printing money can be done without consequences ‘almost indefinitely’, then why stop at x? Why not 2x, or 10x, or 1000x? That's my whole fucking point. For America, right now, we pretty much can. And if we chose to invest it in ourselves instead of subsidising rich fuckos we'd surely see a positive return on our investment even (thereby paying it off). sigh There's literally no place worse on the internet for Economics than HN. I should just delete this fucking account.

3 ms·

> It's really hard to default when your debt is in your own currency. That’s true, but it misses the point because printing money is debasing your currency, no

by mr_toad 6y ago

epistasis 6y ago
I think that is the point though, that the very worst that can possibly happen is hyperinflation. Why not stop at 1000x? That's the entire point of the article, we don't know the situations that set off currency debasement well enough. We all assume that there will at least be some period of normal inflation first, before we get to hyperinflation though. When we have become the global currency, there is also great risk when we do not have enough dollars and treasury bills out there. Because the world's savings are pretty much equivalent to our "debt." As there is more wealth in the world and as more of that wealth is held in US dollars or in US T-bills, if we do not continue to deficit spend, or somehow get more money supply, there are other risks too.
rubyn00bie 6y ago
> That’s true, but it misses the point because printing money is debasing your currency, not defaulting on debt. > And if it’s true that borrowing $x billion and printing money can be done without consequences ‘almost indefinitely’, then why stop at x? Why not 2x, or 10x, or 1000x? That's my whole fucking point. For America, right now, we pretty much can. And if we chose to invest it in ourselves instead of subsidising rich fuckos we'd surely see a positive return on our investment even (thereby paying it off). sigh There's literally no place worse on the internet for Economics than HN. I should just delete this fucking account.