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Yep, fiat money systems are at the core of modern wealth inequality. Regulations and other measures will have little impact until we address this. Bailouts, tax
by danenania 15y ago
Yep, fiat money systems are at the core of modern wealth inequality. Regulations and other measures will have little impact until we address this. Bailouts, taxes, budgets, deficits, regulations: none of it has much relative quantitative significance when the Fed is doling out many trillions behind the scenes. This money directly benefits the very wealthiest and regressively dilutes the rest on a scale that vastly exceeds the effects of any other policies. Abuse of fiat money is the ultimate economic elephant in the room.
- deleted 15y ago[deleted]
- lucasjung 15y agoIt's funny that you say this, because prior to the adoption of fiat money systems, class-warfare leaders agitated for decades (centuries, even?) in favor of a system of fiat money, because they saw fiat money as a way to reduce wealth inequality. The logic goes like this: 1: In general, poor people borrow money from rich people. Interest payments on these loans is a transfer of wealth from the poor to the rich: an increase in debt inequality. 2: Fiat money is much more subject to inflation than commodity money. 3: When inflation occurs, the real value of debts is reduced. 4: By adopting fiat money and the accompanying continuous inflation, a situation would be created whereby poor people could borrow money from the rich, use it to create wealth for themselves, and then effectively pay back less than they had borrowed. I'm not saying they were right, I'm just describing their ideas. I find the whole situation ironic.