Hyperinflation Good For Grrls?
Hilarious rantings of a self-proclaimed "feminist economist," brought to us by melvin_udall at http://melvin-udall.livejournal.com/1237301.html?view=7680565#t7680565 referencing http://msmagazine.com/blog/blog/2011/07/14/a-woman-economist-speaks-out-deficits-are-a-grrrls-best-friend/
My take on it
Feiner, who claims to be an economist (ROFLMAO!) says:
Here are the facts: U.S. government borrowing creates interest-bearing assets. The bonds are bought with dollars, the interest on them is paid in dollars and, at maturity, the bonds are paid off in dollars. Since the U.S. government is both sovereign in its own currency and the sole issuer of dollars, it can never run out of them. How could it?
That's right. The US Government can never run out of dollars, because it can always print more.
Right ... and beside the point. What the US Government cannot force anyone but those directly subject to American law to do is to accept dollars at any particular exchange rate as payment for goods or services. If the US Government attempts to print its way out of the deficit, it will do so at the price of severely devaluing the dollar in exchange against other currencies.
In simple terms, the more and more dollars we print in proportion to our actual wealth, the less and less each dollar is worth. Simple inflation: too much money chasing after too few goods.
What this would mean is that America would pay more for imported services and goods, and yes, this would include economically-vital goods such as oil. What's more, even domestic producers will raise their prices, because they TOO will value the dollars less. The result would be inflation, possibly hyper-inflation, and if the Government tried to meet this with wage and price controls, tremendous shortages of goods and services.
I would think a self-proclaimed economist would know this. Maybe being a "feminist" economist means that the poor little dear isn't expected to think quite so hard as would a real economist?
Other hilarious gems:
Don’t think printing presses here: Federal debts are paid off by Treasury clerks making a few clicks on computer keyboards - keyboards identical to the one I’m typing on now.
Ah, well, that makes all the difference, doesn't it? What wouldn't work on printing presses will just somehow work on computer keyboards. Why bother producing goods or providing services when wealth magically appears with a few keystrokes?
In contrast, families and businesses have to earn income or sell assets to get dollars to pay off debts. The federal government does not face any such constraint. It can spend as much as it likes and borrow as much as it likes.
Certainly -- in terms of DOLLARS, because dollars are a "fiat currency." However, no fiat currency is worth more for very long than the estimate of others of how much real wealth backs the fiat currency. A fiat currency which collapses becomes rapidly worth less, and ultimately worthless. See Germany, 1920's, for the classic example of this happening in a First World nation.
Of course, Weimar Germany didn't have computer keyboards. They had to use printing presses. We could dig ourselves into a much deeper hole, much faster, with the miracles of modern technology!
She then goes on about how there's no real reason why the Government can't ignore self-imposed deficit ceilings. Which is perfectly true, in a legal sense. In an existential economic sense, what she's proposing would be fiscal suicide.
Possibly personal suicide, too. Remember what happened after the German hyperinflation of the 1920's? I wonder how much time he would have had for self-proclaimed "feminist economics." Or maybe she'd serve the new regime: she could lead the "Empiregrrls," or whatever our new Leader chose to call it.
My take on it
Feiner, who claims to be an economist (ROFLMAO!) says:
Here are the facts: U.S. government borrowing creates interest-bearing assets. The bonds are bought with dollars, the interest on them is paid in dollars and, at maturity, the bonds are paid off in dollars. Since the U.S. government is both sovereign in its own currency and the sole issuer of dollars, it can never run out of them. How could it?
That's right. The US Government can never run out of dollars, because it can always print more.
Right ... and beside the point. What the US Government cannot force anyone but those directly subject to American law to do is to accept dollars at any particular exchange rate as payment for goods or services. If the US Government attempts to print its way out of the deficit, it will do so at the price of severely devaluing the dollar in exchange against other currencies.
In simple terms, the more and more dollars we print in proportion to our actual wealth, the less and less each dollar is worth. Simple inflation: too much money chasing after too few goods.
What this would mean is that America would pay more for imported services and goods, and yes, this would include economically-vital goods such as oil. What's more, even domestic producers will raise their prices, because they TOO will value the dollars less. The result would be inflation, possibly hyper-inflation, and if the Government tried to meet this with wage and price controls, tremendous shortages of goods and services.
I would think a self-proclaimed economist would know this. Maybe being a "feminist" economist means that the poor little dear isn't expected to think quite so hard as would a real economist?
Other hilarious gems:
Don’t think printing presses here: Federal debts are paid off by Treasury clerks making a few clicks on computer keyboards - keyboards identical to the one I’m typing on now.
Ah, well, that makes all the difference, doesn't it? What wouldn't work on printing presses will just somehow work on computer keyboards. Why bother producing goods or providing services when wealth magically appears with a few keystrokes?
In contrast, families and businesses have to earn income or sell assets to get dollars to pay off debts. The federal government does not face any such constraint. It can spend as much as it likes and borrow as much as it likes.
Certainly -- in terms of DOLLARS, because dollars are a "fiat currency." However, no fiat currency is worth more for very long than the estimate of others of how much real wealth backs the fiat currency. A fiat currency which collapses becomes rapidly worth less, and ultimately worthless. See Germany, 1920's, for the classic example of this happening in a First World nation.
Of course, Weimar Germany didn't have computer keyboards. They had to use printing presses. We could dig ourselves into a much deeper hole, much faster, with the miracles of modern technology!
She then goes on about how there's no real reason why the Government can't ignore self-imposed deficit ceilings. Which is perfectly true, in a legal sense. In an existential economic sense, what she's proposing would be fiscal suicide.
Possibly personal suicide, too. Remember what happened after the German hyperinflation of the 1920's? I wonder how much time he would have had for self-proclaimed "feminist economics." Or maybe she'd serve the new regime: she could lead the "Empiregrrls," or whatever our new Leader chose to call it.