Democrats Announce Major Changes To House Rules

Apr 2013
36,190
24,614
Left coast
#11
but its an absurd analogy. its not even comparing apples with oranges, its comparing apples with the international space station.

there isnt an upper limit to how big the debt can get, japan is proof of that. the "debt ceiling" is an artificial political tool of no value. the "debt" is only going to grow because it cannot actually shrink, its never going to be repaid, and doesnt need to be. even calling it "debt" is deceptive, you havent actually borrowed the money from anyone.
In fact that isn't true. Much of US debt is Treasury Bonds sold to other nations. Or domestic investers wanting some of their assets in a supposedly very safe if low income position. They want their money too and interest on it has to be paid.

One danger is that China holds lots of it.

And tell Venezuela, Argentina and Greece that debt doesn't matter.
 
Dec 2013
32,767
19,089
Beware of watermelons
#12
but its an absurd analogy. its not even comparing apples with oranges, its comparing apples with the international space station.

there isnt an upper limit to how big the debt can get, japan is proof of that. the "debt ceiling" is an artificial political tool of no value. the "debt" is only going to grow because it cannot actually shrink, its never going to be repaid, and doesnt need to be. even calling it "debt" is deceptive, you havent actually borrowed the money from anyone.

I agree w/ for the most part. The debt ceiling is another hoop they have to jump thru before they go on another unbridled spending spree.

Our money creation "system" and tax system are so deceptive and dishonest it is ridiculous.

Brings this quote to mind.



It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning. Henry Ford
Read more at: Henry Ford Quotes



There is a reason we are taught to regurgitate useless information in school like the names of the boats Columbus sailed over here on and absolutely nothing to do w finance.
 
Mar 2008
9,580
4,862
australia
#13
In fact that isn't true. Much of US debt is Treasury Bonds sold to other nations. Or domestic investers wanting some of their assets in a supposedly very safe if low income position. They want their money too and interest on it has to be paid.

One danger is that China holds lots of it.

And tell Venezuela, Argentina and Greece that debt doesn't matter.
debt doesnt matter if you are a currency issuing government and you have debt denominated in the currency you issue. ask japan.

argentina had debt in US dollars. when their currency devalued vs the US dollar the debt became impossible
venezuelas problem was not debt, it was a massive drop in productivity due to the oil price crash, and they were hamstrung by an incompetent and corrupt government.
and greece, whose debt is in the euro, which greece doesnt issue.

the us government is in a different situation to those three. one branch of government creates dollars, transfers it to treasury, who spends it. there is the elaborate game of treasury bonds, and debt and all that, but you dont actually need that, its there because some of it is constitutionally required, some of it used to be necessary centuries ago, and it was more relevant when on the gold standard, but its just not necessary today. but the game still happens, and leads to absurdities like the debt ceiling and politicians making claims that america is living beyond its means, about to go bankrupt, risks defaulting on its debts, things that are just untrue.
 
Mar 2008
9,580
4,862
australia
#14
I agree w/ for the most part. The debt ceiling is another hoop they have to jump thru before they go on another unbridled spending spree.

Our money creation "system" and tax system are so deceptive and dishonest it is ridiculous.

Brings this quote to mind.



It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning. Henry Ford
Read more at: Henry Ford Quotes



There is a reason we are taught to regurgitate useless information in school like the names of the boats Columbus sailed over here on and absolutely nothing to do w finance.
so we end up with government spending being limited by absurd artificial constructs and not by reality.

for a government who issues their own currency, the limit to spending is not debt, its inflation. inflation is not good, but it is also able to be prevented. trouble is, if the political rulers dont care about their citizens, and look at zimbabwes mugabe and mataro in venezuela, there are political leaders who dont care about their citizens, its possible to ruin a nation with inflation. it seems the consensus is we dont take that risk, instead we fabricate spending restrictions with artificial debt.
 
Apr 2013
36,190
24,614
Left coast
#15
debt doesnt matter if you are a currency issuing government and you have debt denominated in the currency you issue. ask japan.

argentina had debt in US dollars. when their currency devalued vs the US dollar the debt became impossible
venezuelas problem was not debt, it was a massive drop in productivity due to the oil price crash, and they were hamstrung by an incompetent and corrupt government.
and greece, whose debt is in the euro, which greece doesnt issue.

the us government is in a different situation to those three. one branch of government creates dollars, transfers it to treasury, who spends it. there is the elaborate game of treasury bonds, and debt and all that, but you dont actually need that, its there because some of it is constitutionally required, some of it used to be necessary centuries ago, and it was more relevant when on the gold standard, but its just not necessary today. but the game still happens, and leads to absurdities like the debt ceiling and politicians making claims that america is living beyond its means, about to go bankrupt, risks defaulting on its debts, things that are just untrue.
So why was Japan's economy in the toilet for so long when other countries weren't. Their debt, that's why. Interest is an expense that doesn't produce anything.
 
Apr 2013
36,190
24,614
Left coast
#16
debt doesnt matter if you are a currency issuing government and you have debt denominated in the currency you issue. ask japan.

argentina had debt in US dollars. when their currency devalued vs the US dollar the debt became impossible
venezuelas problem was not debt, it was a massive drop in productivity due to the oil price crash, and they were hamstrung by an incompetent and corrupt government.
and greece, whose debt is in the euro, which greece doesnt issue.

the us government is in a different situation to those three. one branch of government creates dollars, transfers it to treasury, who spends it. there is the elaborate game of treasury bonds, and debt and all that, but you dont actually need that, its there because some of it is constitutionally required, some of it used to be necessary centuries ago, and it was more relevant when on the gold standard, but its just not necessary today. but the game still happens, and leads to absurdities like the debt ceiling and politicians making claims that america is living beyond its means, about to go bankrupt, risks defaulting on its debts, things that are just untrue.
And when that devalues the USD to the level of Zimbabwe currency?
 
Mar 2008
9,580
4,862
australia
#17
So why was Japan's economy in the toilet for so long when other countries weren't. Their debt, that's why. Interest is an expense that doesn't produce anything.
no, it was their demographics. low birth rate and minimal migration, rapidly growing aged population.

the debt at the beginning of their 'lost decades' was close to zero. it grew during that time of economic slow growth, it wasnt the cause of it. and there has never been inflation in japan despite all that extra money.

and its 'debt' is mostly owed to itself. which isnt surprising as japan issued the yen that japan then borrowed, so japan owes japan for the money japan issued to japan.
 
Mar 2008
9,580
4,862
australia
#18
And when that devalues the USD to the level of Zimbabwe currency?
why the hell would that happen?

there is an myth in economics that "issuing money = hyperinflation"

this is a lie. its crap. japan should be proof of that, but nobody cares about reality when they have ideology

issuing money = hyperinflation.

zimbabwe. germany. argentina. venezuela

without any attempt to understand that the economic situation of these places was way more complicated than 'issuing money = hyperinflation' they all had a massive drop in productivity and gdp, at a time they had debt denominated in a foreign currency, and corrupt governments. they then printed money in lieu of economic development. thats the problem, printing money during this perfect storm of other economic disasters.

i am not saying a nation can issue currency as much as it likes any time, there are limits to this and if there is too much issued there will be negative consequences. but the lie of 'issuing currency = hyperinflation' should be shot down because its as accurate as 'the earth is flat'.
 

Similar Discussions