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We live in an economy that is highly virtualized, where the same unit of currency can be used several times simultaneously to borrow, lend, re-borrow, etc. so I
by Yoric 1y ago
We live in an economy that is highly virtualized, where the same unit of currency can be used several times simultaneously to borrow, lend, re-borrow, etc. so I'm not sure it's that simple.
- trhway 1y agoIf the US gets invested with such "virtual" ("out-of-thin-air", newly issued, etc.) dollars i guess it would be even worse as it would only inflate prices in US while not doing anything else.
- Yoric 1y agoMaybe? What we're discussing is clearly beyond my ability to grasp (macro-)economics.
- sharpshadow 1y agoIt is inflating prices but also doing a lot more contrary to nothing.
- overfeed 1y agoBeing the biggest reserve currency has a little-discussed perk where the reserves lower the average velocity of money, which blunts the inflationary pressure of money-printing. Eroding trust in the US will deplete these deep pools of USD and will result in a more direct linkage with domestic inflation in the future.