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Badger of Basra posted:If I'm understanding correctly, if it was decided that the federal government would run on MMT terms there would be no bonds. They'd "print" a bunch of money through the Federal Reserve to pay off existing debt (all at once? unclear if this would just generate huge inflation) then not issue anymore. New deficit spending would be paid for through money printing. Actually bonds still have a use, it's a solid investment and a safe haven for your cash. That's why US Treasury bonds have low/negative yields. And as previously stated it helps with maintaining the kayfabe of money being valuable. Paying of all sovereign debt would crash the world economy. What does happen is that the Fed would buy all bonds that need to be issued but lack a buyer. This is the "Whatever it takes" stated by the ECB during the Euro crisis, the loving over of the PIIGS countries (especially Greece) was absolutely unnecessary. Still there is the problem for smaller states that they need dollars for oil and stuff, and this limits their options. Also I want to note that the hyperinflation of neither Weimar nor Zimbabwe was accidental. In Zimbabwe's case it was that or (worse) starvation.
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# ¿ Jan 25, 2019 14:31 |
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# ¿ May 16, 2024 00:21 |