Mike on Nostr: The problem with the debt is it isn't "owed" to anyone. If I lend you $10 you owe me ...
The problem with the debt is it isn't "owed" to anyone.
If I lend you $10 you owe me $10.
If the US government print $10 and sell to the market for existing $10 + interest, their is no creditor.
You are simply diluting all other dollars.
When they have to pay back the debt created by the purchaser of the printed money (the original $10) to the creditor, they can return they can't return the original $10 because that's been spent and they haven't generated any wealth (they are a government, not a company), so everything they return the original $10 + interest) is printed again.
This is monetary recursion and destroys all fiat systems eventually.
So what happens when you insert a hard asset into the equation? Do you destroy or weaken that asset, you certainly don't strengthen that asset.
Does this turn Bitcoin into an inflationary currency despite its inherent deflationary properties.
After all, they HAD to come off the gold standard, because they didn't have enough gold to pay back.
I think best case scenario is Bitcoin repeats what happened to gold. It weakens Bitcoin until it makes it flacid, at which time the government will be forced to leave the Bitcoin Standard and Bitcoin will be a shadow of its potential.
If I lend you $10 you owe me $10.
If the US government print $10 and sell to the market for existing $10 + interest, their is no creditor.
You are simply diluting all other dollars.
When they have to pay back the debt created by the purchaser of the printed money (the original $10) to the creditor, they can return they can't return the original $10 because that's been spent and they haven't generated any wealth (they are a government, not a company), so everything they return the original $10 + interest) is printed again.
This is monetary recursion and destroys all fiat systems eventually.
So what happens when you insert a hard asset into the equation? Do you destroy or weaken that asset, you certainly don't strengthen that asset.
Does this turn Bitcoin into an inflationary currency despite its inherent deflationary properties.
After all, they HAD to come off the gold standard, because they didn't have enough gold to pay back.
I think best case scenario is Bitcoin repeats what happened to gold. It weakens Bitcoin until it makes it flacid, at which time the government will be forced to leave the Bitcoin Standard and Bitcoin will be a shadow of its potential.