Fakeconomics . . . .

[helmsdale]

The one thing that's hit home for me post '08, is that everything takes far longer than you think. The age old adage goes: "the market can remain irrational far longer than you can remain solvent."

I feel this likely has considerable room to get far worse long before it starts to correct... If central banks can print $T's to purchase junk bonds and distressed equities, what's to stop governments world wide from demanding they print huge sums for UBI, low income housing, or massive expansions of the public service?

We're long past the point of disciplined fiscal and monetary policy. I'm thinking this gets a WHOLE lot worse...

[helmsdale]

So long as the "investment", as government expenditures like to be termed these days, accrues greater than 0% then what couldn't be justified these days?

If $1.3T in debt doesnt matter, then why not $13T or $130T?

The AB NDP want 2x the teachers, and nearly double the floorspace for the education dept to get class sizes down to 15 max. It's only $1B/yr or so twitter says.

If debt doesnt matter, why even bother to tax at all?

This likely sounds absolutely retarded to anyone schooled in economics, but most everything currently being practiced is beyond the pale of my econ schooling as is! There's far more perversion incoming!

[macdon02]

We are #1! We are #1! ....

[helmsdale]

We are #1! We are #1! ....

🎶Money, money, money, money, money... MONEY!🎶

Or, 🎶Let the good times roll!🎶

[helmsdale]

Anyone have readily available graphs on M1, and M2 for the similar jurisdictions Macdon posted net assets for?

[helmsdale]

They should be fairly similar shouldn't they?

[macdon02]

They should be fairly similar shouldn't they?

This could be total carnage, i have no idea, but look at gold and bitcoin. There's a reason and it's obvious. By my records, there should be a retest at 1362 and possibly 1197. It comes down to who do you trust and which countries can keep their shit together? This will be vicious as the dominoes begin to fall.

[helmsdale]

I'm guessing that's M2 $US?

Can you drag that chart back to say 1990? Or even pre 2000 meltdown?

[helmsdale]

This has been tried numerous times, but only in individual cases which butt up against other countries that keep the supply stable. I have to sit down and game this out, as it appears there is going to be a coordinated global attempt this time. The mob is going to be insatiable!

[Austrian Economics]

I have to emphasize that central banks don't print money into existence, they borrow it into existence. What we call money originates as a bond. Every bond carries an interest charge. What we typically call cash, i.e. bills, are merely pieces of the bond. But with fiat, there's no way that you can redeem a bond for final payment, i.e. redemption for a commodity such as gold, which would extinguish the debt.

Without redemption for a commodity, debt grows exponentially as interest compounds. Even at the absurdly low rates we now see, the compounding is still unstoppable.

It's bad enough that debt must grow exponentially in a fiat system, but as a result of this covid crisis we now have governments of every stripe borrowing exponentially more than was imaginable even five years ago.

I just saw a TV interview with the mayor of Mississauga cheering on the Ontario government's recent success in lobbying the federal government for billions in aid to municipalities to fill the holes in their budgets. This is, however, not found money. It's simply being added onto Ottawa's already huge debt burden.