The immorality of debt

You have to understand how banking works to understand how the Fed works. Banks make money off spreads. They will purchase Govt debt as long as the government sells it. And we even have the Primary Dealers that we mandate to purchase the debt at a "competitive" price. That means if the Fed wants to lower interest payments on Govt debt they can. If they want the Primary Dealers to take on more Govt debt they can. The Primary Dealers, Fed, and Treasury are not competitors. They work in unison every day of the year to make sure balance sheets are adequate to produce the rates and targets they want. Interest payments are just another expense like any other. They are the least of our problems.

[/quote]
I got plenty of articles from the Fed that supports it. Plus a lot of common sense. Got to learn banking. It's the most pivotal piece to our economy. And if you understand banking you would understand that we will never run out of money or buyers for our debt. We can continue what we are doing to infinity.

 

Really? How many fiat currencies exist from 100 yrs ago? 200? 300? All fiat currencies will eventually die off as a new currency replaces it. Granted, the $$$$ is the 1st world wide currency. Some uncharted territory here.

 

There is not enough gold in the history of the planet to represent the current one year economic output.

If you want to ditch fiat currency, come up with a better alternative.

 

It wasn't about ditching currency, it was about the $$$$ remaining the world's currency keeping the USA a strong nation because of its currency.

 

The U.S. is strong because of its military protection of its currency. Nothing more, nothing less. Until the rest of the world suddenly can afford a military the size of ours, that will not change.

 

So you are going directly to this talking point? How many currencies exist from 100 yrs ago and all fiat currencies will eventually die off? Haha, solid argument. All economic systems have failed regardless of what they used as currency. Just because gold/silver still exist in their physical form does not mean they are successful currencies.

 

Restate, misuse of words. But on the extreme, a world wide disaster could happen where no currency is used. But then our debt won't mean sheet either. But the $$$$ could get replaced. But as ErikBEgss says, our military will do everything it can to prevent it. But it is possible.

 

I once read, and sorry but have forgotten the exact numbers, but supposedly all the gold ever produced in the world would fit in a cube which is 85 feet on each side...slightly larger than Oprah and slightly smaller than Chris Christie...

 

No outsider is going to mess with the value of the dollar as long as the USA remains the economic center of the Universe, as long as outsiders have so much invested in the USA, and the gains they realize in the USA. As things might change down the road, maybe 50-100 years from now, then who knows...

 

I don't think so, and I've never read any respected economist who thinks that. Spare me the wingnut blogger, but what about Krugman, does he say this?

 

When I say the Fed "can" do it, I don't mean that they want to do it. The reason they have to do it is because the economy crumbled after the housing/financial collapse. It's a perfect example of what I'm talking about. If the Fed needs to do something to control our spending/debt they can. They don't want to do it because it means their are real economic problems going on.

And we don't have to collect taxes. We can just deficit spend to infinity but there would be potentially serious inflationary pressures which would negatively effect the economy. I pictures taxation as just another form of inflation control.

I've never read any respected economist who says it couldn't. And the data definitely shows that anyone who has claimed we couldn't in the past has been wrong all along.