4 ms·

I've been a student of housing bubbles for a long time. I remember back in 2003 I was participating in an online forum covering the bubble. The conventional wis

by bink 4y ago

I've been a student of housing bubbles for a long time. I remember back in 2003 I was participating in an online forum covering the bubble. The conventional wisdom back then was that when the bubble popped not even the Fed or Alan Greenspan and his helicopters could cover the losses. The hundreds of billions if not trillions of dollars that would be needed would cause runaway inflation. Then, they did it. The bastards managed to somehow buy tens of billions of mortgage backed securities every month for years. They bailed out automakers and banks with backdoor 0% loans while claiming the "investments" were profitable for the average citizen. Zombie Fannie and Freddie are still out there gobbling up mortgages. It's insane.

User23 4y ago
Money printer go brrrrrrrr. None of this is surprising to people who know how bank money actually works. The US congress literally has unlimited nominal credit and practically unlimited useful credit, and it can grant same to any of its creatures.
- naasking 4y ago
  Of course they could, money is a fiction after all. As long as we all keep walking around believing that fiction, there's no real problem with just inventing more money out of thin air. The fiction has certain properties when it encounters the real world though, so there are sometimes downstream consequences, but none that could ever totally dissolve the fiction. Only enough people starting to disbelieve in the fiction itself could do that, and people mostly won't do that because money is too useful.
  - User23 4y ago
    Well if I don't produce that fiction on demand for something called "taxes" I get put in a cage or even killed by men with guns. So I'm pretty motivated to go along with the fiction until the men with guns stop making me.
    - naasking 4y ago
      Indeed, we make sure the fiction is very convincing: https://www.youtube.com/watch?v=PHnRXST5FUw https://www.youtube.com/watch?v=PHnRXST5FUw

by bink 4y ago

User23 4y ago

Money printer go brrrrrrrr. None of this is surprising to people who know how bank money actually works. The US congress literally has unlimited nominal credit and practically unlimited useful credit, and it can grant same to any of its creatures.

naasking 4y ago
Of course they could, money is a fiction after all. As long as we all keep walking around believing that fiction, there's no real problem with just inventing more money out of thin air. The fiction has certain properties when it encounters the real world though, so there are sometimes downstream consequences, but none that could ever totally dissolve the fiction. Only enough people starting to disbelieve in the fiction itself could do that, and people mostly won't do that because money is too useful.
- User23 4y ago
  Well if I don't produce that fiction on demand for something called "taxes" I get put in a cage or even killed by men with guns. So I'm pretty motivated to go along with the fiction until the men with guns stop making me.
  - naasking 4y ago
    Indeed, we make sure the fiction is very convincing: https://www.youtube.com/watch?v=PHnRXST5FUw https://www.youtube.com/watch?v=PHnRXST5FUw