The Millennials' Money
Economy | Information | History | Online | Facts | World | Global | Money
Introduction and overview of the reality of modern fiat money: Why the millennial generation CAN afford to build a better world. An updated and expanded version of the best-selling "Diagrams & Dollars."
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Gold is not money. The government must spend to create money. Money has only in recent centuries been tied to any commodity. China doesnt print us dollars.
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Also, you neglected to mention the #1 method used by the Fed to control inflation: Interest rates. The Value of a dollar can be expressed as: Value = Demand/Supply.
The Demand for a dollar can be expressed as: Demand = Reward/Risk.
The Reward for owning a dollar is interest. That is why, to combat inflation, the Fed increases the Reward (interest rates) for owning a dollar. When the Fed raises rates, this is said to "strengthen" the dollar, i.e. increase its value.
Unfortunately, Modern Monetary Theory (MMT) believes the opposite -- that increased interest rates increase costs, and thereby cause, rather than cure, inflation. This is a classic example of hypothesis taking precedence over fact. Today, the Fed is trying to stimulate inflation to its 2% annual goal, by keeping interest rates low. Some nations (foolishly) have resorted to negative interest rates, in a vain attempt to stimulate their economies via inflation.
This is described at: https://mythfighter.com/2014/02/02/the-economics-of-chaos-what-we-know-for-sure/ The value of money (inflation) formula -
You should read, Monetary Sovereignty: The key to understanding economics" ("https://mythfighter.com/2010/08/13/monetarily-sovereign-the-key-to-understanding-economics/")
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By far the clearest explanation of Modern Monetary Theory I have seen, well done!
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Interesting
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we don't need to go cap in hand to the robber barons (corporations or big banks in today's world) for some of their money. We can create the money -a demand for goods and services-to provide needs.
The EU could allocate new money for each member of he eurozone and this would remove the need for contributions for development grants from the central budget.
The big banks wouldn't like this but it would hand back control to elected politicians to make decisions. Not perfect but better than the vested financial interests and they would be more accountable.
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