One argument in favor of this idea is that nobody is going to listen to us anyway, so you might as well promote the idea that seems more fun. (There are also boring workarounds available, for...
One argument in favor of this idea is that nobody is going to listen to us anyway, so you might as well promote the idea that seems more fun.
(There are also boring workarounds available, for those who think boring has a better chance.)
are there any good articles that explain exactly how this is cannot in any way lead to a zimbabwae dollar or wimar republic mark? Ive had people tell me that this wont lead to hyperinflation, but...
are there any good articles that explain exactly how this is cannot in any way lead to a zimbabwae dollar or wimar republic mark? Ive had people tell me that this wont lead to hyperinflation, but no one has ever been able to tell me why, and how this is different than what other countries have done.
Raising the debt limit is functionally the same as minting the coin (presumably the coin would never be circulated), and so has no special impact on inflation beyond what we already were going to...
Raising the debt limit is functionally the same as minting the coin (presumably the coin would never be circulated), and so has no special impact on inflation beyond what we already were going to spend. The money was already going to be borrowed from basically thin air (considering the U.S.'s position as the global reserve currency), so whether or not the money is in the form of a coin is besides the point.
The budget has already been set by Congress. The debt ceiling is a contradicting law that says we can't borrow more than x, even if we've already passed a budget that would require us to borrow more than x. Minting the coin is just one idea for how the President can call the bluff on the self-manufactured crisis that Congress has created without having to submit to hostage negotiations.
When money is borrowed there has to be a lender though, and that lender would otherwise have used elsewhere[1]? Although the impact is not 1:1, government spending does crowd out some amount of...
Raising the debt limit is functionally the same as minting the coin
When money is borrowed there has to be a lender though, and that lender would otherwise have used elsewhere[1]? Although the impact is not 1:1, government spending does crowd out some amount of private borrowing. An increase in government borrowing will increase inflation, but by not as much as if they just printed money / minted a coin.
The reason why Zimbabwae-esque hyperinflation is unlikely is that the scale is not there. Comparing changes between Zimbabwae's and the United State's money supply shows that the US is not approaching hyperinflation.
Because the scope is limited to paying the principal and interest of debt issued for the prior and current budget. The markets already expect that that amount of money would enter the ecosystem -...
Because the scope is limited to paying the principal and interest of debt issued for the prior and current budget. The markets already expect that that amount of money would enter the ecosystem - that's what the federal budget was all about, after all. US treasuries are considered the safest asset in the world - the world is already ticking around the idea that the US government will continue to make payments on the treasuries it issues like clockwork.
It's just a dumb trick to get around the part where the US has a discrete "debt ceiling" which is determined separately from the budget, so you get situations where the US has committed to paying X, Y, and Z, and then midway through Congress has to debate whether or not to actually pay X, Y, and Z, despite, y'know, committing to it already.
One argument in favor of this idea is that nobody is going to listen to us anyway, so you might as well promote the idea that seems more fun.
(There are also boring workarounds available, for those who think boring has a better chance.)
are there any good articles that explain exactly how this is cannot in any way lead to a zimbabwae dollar or wimar republic mark? Ive had people tell me that this wont lead to hyperinflation, but no one has ever been able to tell me why, and how this is different than what other countries have done.
Raising the debt limit is functionally the same as minting the coin (presumably the coin would never be circulated), and so has no special impact on inflation beyond what we already were going to spend. The money was already going to be borrowed from basically thin air (considering the U.S.'s position as the global reserve currency), so whether or not the money is in the form of a coin is besides the point.
The budget has already been set by Congress. The debt ceiling is a contradicting law that says we can't borrow more than x, even if we've already passed a budget that would require us to borrow more than x. Minting the coin is just one idea for how the President can call the bluff on the self-manufactured crisis that Congress has created without having to submit to hostage negotiations.
When money is borrowed there has to be a lender though, and that lender would otherwise have used elsewhere[1]? Although the impact is not 1:1, government spending does crowd out some amount of private borrowing. An increase in government borrowing will increase inflation, but by not as much as if they just printed money / minted a coin.
The reason why Zimbabwae-esque hyperinflation is unlikely is that the scale is not there. Comparing changes between Zimbabwae's and the United State's money supply shows that the US is not approaching hyperinflation.
[1]: This is assuming that the federal reserve is not buying the treasury bonds. If debt is purchased by the federal reserve it is functionally identical to minting a coin. But the Fed has apparently stopped purchasing treasury bonds a year ago.
Because the scope is limited to paying the principal and interest of debt issued for the prior and current budget. The markets already expect that that amount of money would enter the ecosystem - that's what the federal budget was all about, after all. US treasuries are considered the safest asset in the world - the world is already ticking around the idea that the US government will continue to make payments on the treasuries it issues like clockwork.
It's just a dumb trick to get around the part where the US has a discrete "debt ceiling" which is determined separately from the budget, so you get situations where the US has committed to paying X, Y, and Z, and then midway through Congress has to debate whether or not to actually pay X, Y, and Z, despite, y'know, committing to it already.