Close Trump allies like Steve Bannon say "the president is pissed every time he looks at the BRICS dedollarization effort". The US fears the Global South challenge to the dollar's exorbitant privilege
Explain how Trump can order the federal reserve to simply print infinite money? That seems like a total lack of checks and balances. I don’t see that happening at all. But it sounds good online.
Not in disagree with that statement to some degree. But going full authoritarian, and I mean full to the point if mythical scenarios that some people online are spouting. I just don’t see that happening. Sure there’s a shit load of injustice, imbalance of power, overreach, all sorts of adjectives, adverbs, etc. But I think some of these what ifs or scenarios are far fetched and the internet loves to reach.
There’s been loads of cover ups, breaches of power, scandals, you name it. But printing infinite money because trump says so and crashing the global economy is not high up on the bingo card. Anything is possible. I’m just saying it seems highly unlikely is all.
They simply do press a button and numbers appear in a federal account. There is some bureocracy involved but that’s how it works in a nutshell.
The US can do this freely without much repercussions because of the US role as an intenational reserve currency, the inflation that comes with printing dollars is offloaded to the rest of the world while the US increases it’s amount of dollars.
basically when the federal government goes into debt, that basically means that the federal reserve which you can imagine like a big bank hands out a loan to the government.
the government doesn’t really have to pay back that debt, ever. (it technically has to but that can be avoided by simply taking out a new loan at a later time).
It does have to pay interest on that debt to all the bond holders, if it doesn’t then the bonds lose value and everyone that owns them trys to offload them.
if the interest is just as high as the general inflation, then the government can just take out extra loans to serve the interest without actually increasing the real total debt, because the nominal increase in debt is just eaten by the inflation.
the federal reserve which you can imagine like a big bank hands out a loan to the government.
No. Debt goes directly to markets. Federal Reserve QE operations are acts of imagining new money to buy bonds from the market. You are describing QE operations, not debt. Past QE operations have forgone interest on Federal reserve holdings, gifting it to Treasury such that the bonds that Fed holds become interest free. The accounting magic is that when the bond is finally due, the Federal reserve does get paid in order to erase the imaginary money they created to buy the bonds. But a given QE balance sheet level, they just buy a new bond from the market with new imagined money.
Explain how Trump can order the federal reserve to simply print infinite money? That seems like a total lack of checks and balances. I don’t see that happening at all. But it sounds good online.
Where have you been
Not in disagree with that statement to some degree. But going full authoritarian, and I mean full to the point if mythical scenarios that some people online are spouting. I just don’t see that happening. Sure there’s a shit load of injustice, imbalance of power, overreach, all sorts of adjectives, adverbs, etc. But I think some of these what ifs or scenarios are far fetched and the internet loves to reach.
There’s been loads of cover ups, breaches of power, scandals, you name it. But printing infinite money because trump says so and crashing the global economy is not high up on the bingo card. Anything is possible. I’m just saying it seems highly unlikely is all.
They simply do press a button and numbers appear in a federal account. There is some bureocracy involved but that’s how it works in a nutshell.
The US can do this freely without much repercussions because of the US role as an intenational reserve currency, the inflation that comes with printing dollars is offloaded to the rest of the world while the US increases it’s amount of dollars.
basically when the federal government goes into debt, that basically means that the federal reserve which you can imagine like a big bank hands out a loan to the government.
the government doesn’t really have to pay back that debt, ever. (it technically has to but that can be avoided by simply taking out a new loan at a later time).
i hope i explained that correctly.
It does have to pay interest on that debt to all the bond holders, if it doesn’t then the bonds lose value and everyone that owns them trys to offload them.
Which they print too.
if the interest is just as high as the general inflation, then the government can just take out extra loans to serve the interest without actually increasing the real total debt, because the nominal increase in debt is just eaten by the inflation.
No. Debt goes directly to markets. Federal Reserve QE operations are acts of imagining new money to buy bonds from the market. You are describing QE operations, not debt. Past QE operations have forgone interest on Federal reserve holdings, gifting it to Treasury such that the bonds that Fed holds become interest free. The accounting magic is that when the bond is finally due, the Federal reserve does get paid in order to erase the imaginary money they created to buy the bonds. But a given QE balance sheet level, they just buy a new bond from the market with new imagined money.