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    zero hedge | 12 min
    16 reads10 comments
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    zero hedge
    16 reads
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    • Pegeen
      Reading streakScribe
      3 months ago

      The entire structure of our monetary system never made any sense to me. The National Debt is in the trillions - really? When I see a scene of the NY Stock Exchange on TV and there’s a group of people staring at a huge screen of numbers, scraps of paper all over the floor and they are all ranting and raving, I think to myself, this is NUTS! I found this article fascinating - some actual sense in an otherwise insane system.

      • sjwoo3 months ago

        That national debt number used to freak me out, but no longer. The national debt is not like any other debt...it's certainly not like our debt. It'll never be paid back. It's just a thing that gets bigger. It has no bearing on anything real.

        The biggest reason why it doesn't matter is that unlike every other form of debt, the debt issuer has the ability to print money. Here's a much better explanation, by someone far smarter than me: https://qr.ae/pNK0LY

        • Pegeen
          Reading streakScribe
          3 months ago

          Thanks for the link but it’s SO depressing! This has left me wondering, what is real?

          • Alexa
            Scout
            3 months ago

            oh man, I was totally in that space on Friday! WHAT IS REAL. I listened to Debt, the first 5000 years a few years ago and it blew my mind but left me more confused. so far the comments seem to confirm that money is very very confusing topic. do the economists even "get" it?

    • sjwoo3 months ago

      Zero Hedge! This website used to actually be somewhat decent, but it has unfortunately devolved into a repository of right-wing nutjobs.

      Two links worth mentioning:

      1. https://www.theonion.com/recession-plagued-nation-demands-new-bubble-to-invest-i-1819569940

      2. If you really want to understand what money is and how it functions, check out Philosophical Economics:

      http://www.philosophicaleconomics.com/2013/05/the-meaning-of-money/

      PE actually wrote a very good piece on the gold standard (and the lack of need for it): http://www.philosophicaleconomics.com/2014/07/goldstandard/

      I personally have never understood the reason for gold's value. It actually has very little intrinsic value -- I think it's used in some electronics, and I guess there's some value in being flaked into the bottom of Goldschlager; it's just something humans have agreed that it has value. Bitcoin is a better imaginary store of value, but not enough people believe in it. Not yet, at least, which is why it's so volatile.

      The idea that a return to the gold standard would suddenly solve all of our economic problems is ridiculous. It would cause a worldwide depression. The fiat genie has been let out of the bottle; there is no turning back.

      1. Update (7/11/2020):

        Worth mentioning -- when I suggest the return to the gold standard would cause mass chaos, what I really mean is gold standard = actual monetary limitation/containment. If you do end up reading the PE gold standard article, you'll see this:

        The second misconception pertains to the idea that US financial system was somehow on a gold standard after 1933. It was not. The gold standard ended in the Spring of 1933, when FDR issued executive order 6102. This order made it illegal for individuals within the continental United States to own gold. If gold can’t be legally owned, then it can’t be legally redeemed. If it can’t be legally redeemed, then it can’t constrain the central bank.

      • Alexa
        Scout
        3 months ago

        ooh yay! these links are so helpful. my mother sent me this video that linked to the 1971 stuff, led to a mini doc called "hard money" and so much more. there is so much here I wasn't aware of (economics was my only "D" in school, oops), and the gold thing is WEIRD.

        I'm reading Jaron Lanier's 2014 book "Who Owns the Future?" and it's starting to dig into these sort of economics based topics. such a wacky thing. It feels like econ should be so concrete, but then it's as nebulous as any topic in practice.

    • Florian
      Reading streakScoutScribe
      3 months ago

      This is fascinating. I’ve studied economics but I don’t remember having all these correlations pointed out.

    • [user]3 months ago

      This comment was deleted on 8/6/2020

    • jbuchana
      Scout
      3 months ago

      Informative, but I don't know enough about economics to judge the validity of their statements.

    • Alexa
      Scout
      3 months ago

      fascinating