Fun fact for those on the fence about this, the US has monetary sovereignty in a fiat currency, which means that the US government has essentially infinite money.
Edit: for those that are curious, yes, the game about the federal budget is exactly that. The deficit is essentially tracking the amount of money that the federal government owes to itself. Remember, fiat currency means that the value of money exists because the government says that it holds that specific value. A $2 dollar bill is still worth $2 when purchasing items, but worth several $ more than the printed value.
Edit 2: I didn’t think it needed to be said, but I’ve been proven wrong. I don’t literally mean infinite money.
I wonder, sometimes, what a society would look like without inflation. Is there an economic system that says “this is the price of bread, from now on” and builds off of that?
Of course, my only talents are music and memes, so I doubt that I’d specifically benefit from such a system, but maybe humanity as a whole?
One of the reasons some inflation is ‘good’ is that it drives investment. People are discouraged from saving their money since it will slowly devalue. Rather, those with capital are incentived to invest it in other areas of the economy.
That would only happen if deflation was a thing too. In my (highly idealistic) world, money would not change value at all, so growth in a business would be real, not just projected numbers on a chart no one understands. In a fixed-econony, you invest into businesses that actually grow.
I know this may come off as controversial, but this sort of thinking will be necessary for interstellar trade, if we don’t blow ourselves up first.
Could you elaborate a bit on that? I’m not really sure how a business that “actually grows” would be functional ina fixed economy without becoming confusing graphs or entering some other major problem.
Like, the business actually gets bigger: opens more stores, creates new products, offers more services. The regulatory system behind this is starting to sound a bit tankie though, so I’m gonna shelve it for more thought.
Taxes are the current most frequent form of deflation in any country with a sovereign currency. The government spends/prints money in step one, the currency circulates through the economy in step two, and the last step, taxes, is your anti-inflationary device.
But fine, then my bicycle is worth how many breads? If I offer to how many breads is that worth? I don’t care what kind of leftist you are, these are the real questions we should be asking in a post-capitalist society.
After a while it becomes a pain to lug all that bread around, so what if everyone just agrees to have little bits of paper with “1 bread” written on it in place of actual bread, and we can use that. Someone gives you a bit of bread-paper and later if you need bread, you can just go see them at home, or wherever they keep their bread, and get a loaf or two as agreed.
But of course people will just write “1 bread” without actually having the bread so it’s better if we have some central authority where people can swap their bread for carefully drawn bits of paper that can be verified as real, and if anyone wants bread they can just go to that authority and swap their paper back for bread.
You don’t have to go and actually get the bread of course. Nearly everyone will take the bread-paper as a replacement for actual bread, because hey, if they really need bread they can go to that central authority and get bread. And it’s good bread, high quality stuff, so everyone trusts them to give them bread if they need it, but how many people really need all that actual bread? It’s much easier to swap bits of bread-paper for that motorcycle, or groceries, or whatever, rather than pass actual bread around the place.
But then after a while it becomes a real nuisance to hold all that bread somewhere, so how about we just hold a nominal amount of bread, say, enough to cover people who might want to change their bits of paper for bread today, and for the rest of the bread we’re supposed to have we’ll just keep track of who has how many bread-papers in a journal.
And so on and so forth, until there’s no bread at all and hardly any bread-papers even, and we’re transferring bread-papers electronically using phones and plastic cards with a lot of smarts in them and in the end we’re just mucking around with bread-numbers in a book somewhere.
I can’t tell if you’re being sarcastic, but I love the revolutionary optimism. That has been a question that has been posed in philosophical politics ever since Marx and Engels were alive.
Price controls were something people were trying even as far back as the crisis of the third century when Diocletian set the standard prices for several common items bought by the Roman peasantry like bread.
Contrasting against the grain dole, which worked better because it was the state stepping in to directly remove a large cost from the lives of eligible households, allowing them to put that money towards improving their fiscal standing. For ancient Romans it was Bread, but for modern Americans a solid equivalent would be medicine or education, shit you could argue that the post war boom was in part because of the govt. doing this partially with housing, subsidizing the costs of WWII vets to build new homes or buy existing ones, of course because America black vets got shafted and redlined but the general idea is still there.
And in a country with practically infinite money, why don’t we ensure housing? We have infinite money, we could house literally everyone, but we don’t. Why not?
Infinite money is not the same as infinite resources. We can’t just create houses out of thin air just because we have money. We still need tangible things like lumber and concrete to actually build the house.
With that said, we could certainly provide housing for everyone in the U.S. It’s not an issue of resource scarcity.
Not even housing scarcity, there’s already more available units than there are unhoused people, the problem is property owners who are eating properties up they have no intentions of living in themselves to collect rent on them.
It’s a way to force the masses to be productive for their capitalist overlords. Overt slavery isn’t acceptable any more, but saying “you’re going to live under a bridge unless you comply” still is.
Not a reading, but it’ll certainly getcha blood boiling!
He’s actually a good resource on ancient Roman history generally too, he’s the guy who brought my attention to how successful the grain dole system was and why it was that successful.
He also includes social developments like the Aedileship of Agrippa, which was one of the greatest periods of infrastructure development and renewal in Roman history.
Not sarcastic at all, I just wonder about the need for “growth”. I know absolutely nothing about the theory, I just wanna know why it seems to be necessary. Why don’t we fix prices, or at least have them justified regionally, based on the need of the region?
There is no need for growth. Sustainability used to be a thing. But the wealthy do what the wealthy do with all their leasure. Turning systems inside out and on their head. Gaming it till the growth pushes everyone else out. And it’s not likely to change till capitalists are regulated from existence.
Currency and markets can exist without capitalism. Sustainably can’t exist with capitalism.
For those that are curious this is not even remotely close to how the economy words. The us government absolutely does not have unlimited real money, sure they can print money and it will become worthless. But that’s not the same.
neither of those governments had monetary sovereignty. Zimbabwe was also an exceedingly rare case of hyperinflation within a country using fiat currency.
Edit: please, engage with the source material. What about monetary sovereignty is incorrect?
If what you are claiming is true that the government has unlimited real money this means three things. 1 any government could make as much real money as they like and massively improve the livelihoods of all citizens but choose not to. There is a guaranteed Nobel prize in economics and probably physics. Someone somewhere is hiding a huge conspiracy for whatever reason.
That at a minimum requires a paper on the topic. A YouTube video isn’t up to that standard.
The claim you are making is extraordinary. I’m not going to watch 1.5 hour worth of YouTube to prove you wrong just as I wouldn’t for a flat earther.
It really is up to you to explain this world changing information succinctly and coherently. To at least raise the topic. What you are saying is all the governments and universities are wrong here is a a load of YouTube videos. Not worth my time sorry.
Looks like you have a lot of reading to do. If only there were an easily digestible way to consume all of this information in a way that only had the relevant parts for our discussion.
Yes inflation erodes money. Yes nothing in that article proves what you are saying or has anything I disagree with.
If the government starts buying more stuff it will cause demand-pull inflation. That goes against what you say.
Article on zimbabwe
“Further, the response of the government to buy political favours by increasing its net spending without adding to productive capacity was always going to generate inflation and then hyperinflation.”
That goes against what you say. They increasing spending (looks like they were going for infinite money cheat) that didn’t work. Therefore that also proves the point I am making you cant just spend spend spend and the world will be perfect.
Third article. I would copy and past but I can’t. 3 The MMT perspective .
Just read that. Government spending caused inflation. Therefore they don’t have unlimited money they destroyed their economy overbuying.
Take a step back. I have looked at your sources and they go against what you are saying. You need to reanalyse your views and see if they are right or if you just want them to be right.
I have responded to what you have stated so now it’s your turn to answer the questions without YouTube or books or articles. Just answer.
The question is this how does the US government have infinite money?
How does the government buying huge amounts not cause hyperinflation and therefore stop them buying everything?
How does the government print money without it causing inflation?
Just to be clear I understand government deficit and a government running a deficit is not an example of governments having unlimited spending power. It’s spending now and paying for it later. This differs from personal spending in the fact that humans have to pay off their loans in their lifetime, the government does not. So don’t use that as an explanation for the above points as it is invalid.
Do just like to be an insufferable dickhead, or is this you being serious? Congrats, you learned what hyperbole means. Fiat currency is limited by the real economy. In the US, the real economy is trillions of dollars more than the federal budget. You’d know that if you watched those videos. The deficit is a myth, and the only real spending limit is the resources available to the government.
As someone who is not informed on this and just is going by what is written in this thread, the videos seemed high quality and informative, and you saying “I got a degree” and refusing to engage because you don’t like YouTube is absolutely unhelpful and uninformative.
It seems like @rockSlayer@lemmy.world is right, based on the information available right here. If you really disagree and would like like to show otherwise, please do engage and provide more information, I find this interesting.
The German government in the early '20s engineered their hyperinflation as part of an attempt to demonstrate an inability to pay the ruinous war reparations demanded by the Versailles Treaty. It’s really not a good example of “natural” inflation.
He talked about fiat money being unlimited but it isn’t unlimited.
Fiat money is a type of currency that is not backed by a commodity, such as gold or silver. It is typically designated by the issuing government to be legal tender.
In no way did he explain why fiat money is unlimited money. That’s the bit that needs explaining.
If you flood the economy with money that money becomes less valuable (inflation) and therefore you need more money to buy things. At no point does that mean you can buy unlimited goods, it just means you can print worthless paper.
So yea I need to know what evidence I’m disputing to dispute something. It’s not up to me to disprove an argument that hasn’t even been explained.
He didn’t say that it wouldn’t affect inflation. He didn’t say it’s value doesn’t go down by printing more. He simply said it’s possible to print an unlimited amount (I assume barring a shortage of paper or ink or labor), and that remains true.
On the other hand, he’s now apparently changed his mind. It would seem he did indeed mean to imply more than just his words.
At best, they’re a tertiary source consistimg of a bunch of condensed summaries of other sources
More often they’re cherrypicked by content creators to build a narrative for entertainment
And like, in this context (Lemmy comment debate) you’re asking people to watch a bunch of videos with ads and debunk the points inside. Maybe thats not too much to ask in other contexts, but you must know nobody arguing with you here is going to spend their time doing that
I could link to a bunch of flat earth videos as sources, and although they would be easily debunked, nobody here is gonna sit through them and follow up the specific claims they make
The Second Thought video is indeed a tertiary source, but the 1Dime videos has all sources in the comments. I understand that people don’t “like” it as a source, but that doesn’t invalidate them either. They are essentially longer form content explaining what I said in greater detail. If someone came in and said inflation was due to the flat earth, then we can dismiss those claims. Any “sources” would not be backed by economic or scientific theory. This doesn’t change based on the format of the source.
This is an internet comment section. You need to chill about youtube videos as sources. It almost comes off as snobbish. No one here is under any obligation to do anything for each other. If you wanna ignore a long video someone posted because you don’t want to sit through it, fine. You are allowed to do that.
The existence of flat earth videos doesn’t invalidate the entire concept of information in videos.
Absolutely correct. And for more detail on how non-fiat economies work and why the deficit is essentially a fiction to keep bond markets functioning, I recommend reading “The Deficit Myth” by Stephanie Kelton. This also explains why the EU will never rival the US (TLDR: EU member states are not able to control their individual monetary policies).
Fun fact for those on the fence about this, the US has monetary sovereignty in a fiat currency, which means that the US government has essentially infinite money.
Edit: for those that are curious, yes, the game about the federal budget is exactly that. The deficit is essentially tracking the amount of money that the federal government owes to itself. Remember, fiat currency means that the value of money exists because the government says that it holds that specific value. A $2 dollar bill is still worth $2 when purchasing items, but worth several $ more than the printed value.
Edit 2: I didn’t think it needed to be said, but I’ve been proven wrong. I don’t literally mean infinite money.
I wonder, sometimes, what a society would look like without inflation. Is there an economic system that says “this is the price of bread, from now on” and builds off of that?
Of course, my only talents are music and memes, so I doubt that I’d specifically benefit from such a system, but maybe humanity as a whole?
One of the reasons some inflation is ‘good’ is that it drives investment. People are discouraged from saving their money since it will slowly devalue. Rather, those with capital are incentived to invest it in other areas of the economy.
That would only happen if deflation was a thing too. In my (highly idealistic) world, money would not change value at all, so growth in a business would be real, not just projected numbers on a chart no one understands. In a fixed-econony, you invest into businesses that actually grow.
I know this may come off as controversial, but this sort of thinking will be necessary for interstellar trade, if we don’t blow ourselves up first.
Could you elaborate a bit on that? I’m not really sure how a business that “actually grows” would be functional ina fixed economy without becoming confusing graphs or entering some other major problem.
Like, the business actually gets bigger: opens more stores, creates new products, offers more services. The regulatory system behind this is starting to sound a bit tankie though, so I’m gonna shelve it for more thought.
Taxes are the current most frequent form of deflation in any country with a sovereign currency. The government spends/prints money in step one, the currency circulates through the economy in step two, and the last step, taxes, is your anti-inflationary device.
Certain people could be taxed more…
Then bread becomes the currency
But fine, then my bicycle is worth how many breads? If I offer to
how many breads is that worth? I don’t care what kind of leftist you are, these are the real questions we should be asking in a post-capitalist society.
After a while it becomes a pain to lug all that bread around, so what if everyone just agrees to have little bits of paper with “1 bread” written on it in place of actual bread, and we can use that. Someone gives you a bit of bread-paper and later if you need bread, you can just go see them at home, or wherever they keep their bread, and get a loaf or two as agreed.
But of course people will just write “1 bread” without actually having the bread so it’s better if we have some central authority where people can swap their bread for carefully drawn bits of paper that can be verified as real, and if anyone wants bread they can just go to that authority and swap their paper back for bread.
You don’t have to go and actually get the bread of course. Nearly everyone will take the bread-paper as a replacement for actual bread, because hey, if they really need bread they can go to that central authority and get bread. And it’s good bread, high quality stuff, so everyone trusts them to give them bread if they need it, but how many people really need all that actual bread? It’s much easier to swap bits of bread-paper for that motorcycle, or groceries, or whatever, rather than pass actual bread around the place.
But then after a while it becomes a real nuisance to hold all that bread somewhere, so how about we just hold a nominal amount of bread, say, enough to cover people who might want to change their bits of paper for bread today, and for the rest of the bread we’re supposed to have we’ll just keep track of who has how many bread-papers in a journal.
And so on and so forth, until there’s no bread at all and hardly any bread-papers even, and we’re transferring bread-papers electronically using phones and plastic cards with a lot of smarts in them and in the end we’re just mucking around with bread-numbers in a book somewhere.
Just want to say my initial comment was a bit tongue in cheek but you actually used it to explain the issue really well, so thank you!
Tiktokers in 2020 just became very wealthy lol
I can’t tell if you’re being sarcastic, but I love the revolutionary optimism. That has been a question that has been posed in philosophical politics ever since Marx and Engels were alive.
Before even then
Price controls were something people were trying even as far back as the crisis of the third century when Diocletian set the standard prices for several common items bought by the Roman peasantry like bread.
Contrasting against the grain dole, which worked better because it was the state stepping in to directly remove a large cost from the lives of eligible households, allowing them to put that money towards improving their fiscal standing. For ancient Romans it was Bread, but for modern Americans a solid equivalent would be medicine or education, shit you could argue that the post war boom was in part because of the govt. doing this partially with housing, subsidizing the costs of WWII vets to build new homes or buy existing ones, of course because America black vets got shafted and redlined but the general idea is still there.
And in a country with practically infinite money, why don’t we ensure housing? We have infinite money, we could house literally everyone, but we don’t. Why not?
Infinite money is not the same as infinite resources. We can’t just create houses out of thin air just because we have money. We still need tangible things like lumber and concrete to actually build the house.
With that said, we could certainly provide housing for everyone in the U.S. It’s not an issue of resource scarcity.
Not even housing scarcity, there’s already more available units than there are unhoused people, the problem is property owners who are eating properties up they have no intentions of living in themselves to collect rent on them.
We have the houses already. We don’t actually need to create them, though we sure could if need be.
It’s a way to force the masses to be productive for their capitalist overlords. Overt slavery isn’t acceptable any more, but saying “you’re going to live under a bridge unless you comply” still is.
I’d genuinely love to learn more, do you have any readings for pre-marxist ideas about equality in economics?
https://youtu.be/hvk_XylEmLo?si=k4sT-b3VnwAdjiTI
Not a reading, but it’ll certainly getcha blood boiling!
He’s actually a good resource on ancient Roman history generally too, he’s the guy who brought my attention to how successful the grain dole system was and why it was that successful.
He also includes social developments like the Aedileship of Agrippa, which was one of the greatest periods of infrastructure development and renewal in Roman history.
Not sarcastic at all, I just wonder about the need for “growth”. I know absolutely nothing about the theory, I just wanna know why it seems to be necessary. Why don’t we fix prices, or at least have them justified regionally, based on the need of the region?
There is no need for growth. Sustainability used to be a thing. But the wealthy do what the wealthy do with all their leasure. Turning systems inside out and on their head. Gaming it till the growth pushes everyone else out. And it’s not likely to change till capitalists are regulated from existence.
Currency and markets can exist without capitalism. Sustainably can’t exist with capitalism.
On many items produced in the USSR, the price was molded into the form itself, since it was fixed and wasn’t going to change.
That’s how you end up with either huge government spending to keep the prices of something fixed either by subsidies or by buying surpluses.
Or you end up with shortages and a black market.
Again, infinite money. Surplus could be exported to countries who don’t have infinite money.
Also, yarr
Holy Zimbabwe Batman!
For those that are curious this is not even remotely close to how the economy words. The us government absolutely does not have unlimited real money, sure they can print money and it will become worthless. But that’s not the same.
I have sources to back up this claim. Where are yours?
I got a degree in economics. I’m not going to watch up trash on YouTube. If you can’t condense it and make a point it is obviously meaningless.
The government buys things with US dollars, if it uses huge huge amounts of US dollars to buy things you get inflation. It’s a basic premise…
Just look at Germany pre ww2 or look at Zimbabwe after it stopped being Rhodesia.
neither of those governments had monetary sovereignty. Zimbabwe was also an exceedingly rare case of hyperinflation within a country using fiat currency.
Edit: please, engage with the source material. What about monetary sovereignty is incorrect?
YouTube isnt a source.
If what you are claiming is true that the government has unlimited real money this means three things. 1 any government could make as much real money as they like and massively improve the livelihoods of all citizens but choose not to. There is a guaranteed Nobel prize in economics and probably physics. Someone somewhere is hiding a huge conspiracy for whatever reason.
That at a minimum requires a paper on the topic. A YouTube video isn’t up to that standard.
The claim you are making is extraordinary. I’m not going to watch 1.5 hour worth of YouTube to prove you wrong just as I wouldn’t for a flat earther.
It really is up to you to explain this world changing information succinctly and coherently. To at least raise the topic. What you are saying is all the governments and universities are wrong here is a a load of YouTube videos. Not worth my time sorry.
Fine, let me grab you some of the sources used in one of these highly researched videos.
Books:
Articles:
Looks like you have a lot of reading to do. If only there were an easily digestible way to consume all of this information in a way that only had the relevant parts for our discussion.
Article by Forbes.
Yes inflation erodes money. Yes nothing in that article proves what you are saying or has anything I disagree with.
If the government starts buying more stuff it will cause demand-pull inflation. That goes against what you say.
Article on zimbabwe
“Further, the response of the government to buy political favours by increasing its net spending without adding to productive capacity was always going to generate inflation and then hyperinflation.”
That goes against what you say. They increasing spending (looks like they were going for infinite money cheat) that didn’t work. Therefore that also proves the point I am making you cant just spend spend spend and the world will be perfect.
Third article. I would copy and past but I can’t. 3 The MMT perspective .
Just read that. Government spending caused inflation. Therefore they don’t have unlimited money they destroyed their economy overbuying.
Take a step back. I have looked at your sources and they go against what you are saying. You need to reanalyse your views and see if they are right or if you just want them to be right.
I have responded to what you have stated so now it’s your turn to answer the questions without YouTube or books or articles. Just answer.
The question is this how does the US government have infinite money?
How does the government buying huge amounts not cause hyperinflation and therefore stop them buying everything?
How does the government print money without it causing inflation?
Just to be clear I understand government deficit and a government running a deficit is not an example of governments having unlimited spending power. It’s spending now and paying for it later. This differs from personal spending in the fact that humans have to pay off their loans in their lifetime, the government does not. So don’t use that as an explanation for the above points as it is invalid.
Do just like to be an insufferable dickhead, or is this you being serious? Congrats, you learned what hyperbole means. Fiat currency is limited by the real economy. In the US, the real economy is trillions of dollars more than the federal budget. You’d know that if you watched those videos. The deficit is a myth, and the only real spending limit is the resources available to the government.
As someone who is not informed on this and just is going by what is written in this thread, the videos seemed high quality and informative, and you saying “I got a degree” and refusing to engage because you don’t like YouTube is absolutely unhelpful and uninformative.
It seems like @rockSlayer@lemmy.world is right, based on the information available right here. If you really disagree and would like like to show otherwise, please do engage and provide more information, I find this interesting.
The economics major has a point actually, but it’s nowhere near as interesting or important a point as they think.
Actually it just seems like the economics major is rude and doesn’t know what hyperbole is.
The German government in the early '20s engineered their hyperinflation as part of an attempt to demonstrate an inability to pay the ruinous war reparations demanded by the Versailles Treaty. It’s really not a good example of “natural” inflation.
That’s literally what he did in the first comment you replied to.
He posted the sources to back up his point because you were disputing it, and then you said “you don’t have a point!” Ridiculous.
Classic economics major, though.
Yep. “I know better, so just shut up!”
He’ll make a typical politician one day.
He talked about fiat money being unlimited but it isn’t unlimited.
Fiat money is a type of currency that is not backed by a commodity, such as gold or silver. It is typically designated by the issuing government to be legal tender.
In no way did he explain why fiat money is unlimited money. That’s the bit that needs explaining.
If you flood the economy with money that money becomes less valuable (inflation) and therefore you need more money to buy things. At no point does that mean you can buy unlimited goods, it just means you can print worthless paper.
So yea I need to know what evidence I’m disputing to dispute something. It’s not up to me to disprove an argument that hasn’t even been explained.
He didn’t say that it wouldn’t affect inflation. He didn’t say it’s value doesn’t go down by printing more. He simply said it’s possible to print an unlimited amount (I assume barring a shortage of paper or ink or labor), and that remains true.
On the other hand, he’s now apparently changed his mind. It would seem he did indeed mean to imply more than just his words.
“infinite” is hyperbole. In this context, it means “more than enough”.
It should be obvious, “infinite” can never apply to real world situations like this.
Can we please not have YouTube videos be sources
At best, they’re a tertiary source consistimg of a bunch of condensed summaries of other sources
More often they’re cherrypicked by content creators to build a narrative for entertainment
And like, in this context (Lemmy comment debate) you’re asking people to watch a bunch of videos with ads and debunk the points inside. Maybe thats not too much to ask in other contexts, but you must know nobody arguing with you here is going to spend their time doing that
I could link to a bunch of flat earth videos as sources, and although they would be easily debunked, nobody here is gonna sit through them and follow up the specific claims they make
The Second Thought video is indeed a tertiary source, but the 1Dime videos has all sources in the comments. I understand that people don’t “like” it as a source, but that doesn’t invalidate them either. They are essentially longer form content explaining what I said in greater detail. If someone came in and said inflation was due to the flat earth, then we can dismiss those claims. Any “sources” would not be backed by economic or scientific theory. This doesn’t change based on the format of the source.
This is an internet comment section. You need to chill about youtube videos as sources. It almost comes off as snobbish. No one here is under any obligation to do anything for each other. If you wanna ignore a long video someone posted because you don’t want to sit through it, fine. You are allowed to do that.
The existence of flat earth videos doesn’t invalidate the entire concept of information in videos.
Get an ad blocker or use piped or something.
Absolutely correct. And for more detail on how non-fiat economies work and why the deficit is essentially a fiction to keep bond markets functioning, I recommend reading “The Deficit Myth” by Stephanie Kelton. This also explains why the EU will never rival the US (TLDR: EU member states are not able to control their individual monetary policies).