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The U.S. national debt just passed $36 trillion, only four months after it passed $35 trillion and up $2 trillion for the year. Third quarter data is not yet available, but interest payments as a percent of tax receipts rose to 37.8% in the third quarter of 2024, the highest since 1996. That means interest is eating up over one-third of our tax revenues.
Total interest for the fiscal year hit $1.16 trillion, topping one trillion for the first time ever. That breaks down to $3 billion per day. For comparative purposes, an estimated $11 billion, or less than four days’ federal interest, would pay the median rent for all the homeless people in America for a year. The damage from Hurricane Helene in North Carolina alone is estimated at $53.6 billion, for which the state is expected to receive only $13.6 billion in federal support. The $40 billion funding gap is a sum we pay in less than two weeks in interest on the federal debt.
The current debt trajectory is clearly unsustainable, but what can be done about it? Raising taxes and trimming the budget can slow future growth of the debt, but they are unable to fix the underlying problem — a debt grown so massive that just the interest on it is crowding out expenditures on the public goods that are the primary purpose of government.
Borrowing Is Actually More Inflationary Than Printing
Several financial commentators have suggested that we would be better off if the Treasury issued the money for the budget outright, debt-free. Martin Armstrong, an economic forecaster with a background in computer science and commodities trading, contends that if we had just done that in the first place, the national debt would be only 40% of what it is today. In fact, he argues, debt today is the same as money, except that it comes with interest. Federal securities can be posted in the repo market as collateral for an equivalent in loans, and the collateral can be “rehypothecated” (re-used) several times over, creating new money that augments the money supply just as would happen if it were issued directly.
Chris Martenson, another economic researcher and trend forecaster, asked in a Nov. 21 podcast,The argument for borrowing rather than printing is that the government is borrowing existing money, “What great harm would happen if the Treasury just issued its own money directly and didn’t borrow it? … You’re still overspending, you still probably have inflation, but now you’re not paying interest on it.” so it will not expand the money supply. That was true when money consisted of gold and silver coins, but it is not true today. In fact borrowing the money is now more inflationary, increasing the money supply more, than if it were just issued directly, due to the way the government borrows. It issues securities (bills, bonds and notes) that are bid on at auction by selected “primary dealers” (mostly very large banks). Quoting from Investopedia:
Because most modern economies rely on fractional reserve banking, when primary dealers purchase government debt in the form of Treasury securities, they are able to increase their reserves and expand the money supply by lending it out. This is known as the money multiplier effect.
Thus, “the government increases cash reserves in the banking system,” and “the increase in reserves raises the money supply in the economy.” And because the debt is never repaid but just gets rolled over from year to year along with the interest due on it, the interest compounds, an increasing amount of debt-at-interest is generated, and the money supply and inflation go up.
U.S. Currency Should Be Issued by the U.S. Government
Well over 90% of the U.S. money supply today is issued not by the government but by private banks when they make loans. As Thomas Edison argued in 1921, “It is absurd to say that our country can issue $30 million in bonds and not $30 million in currency. Both are promises to pay, but one promise fattens the usurers and the other helps the people.”
The government could avoid increasing the debt by printing the money for its budget as President Lincoln did, as U.S. Notes or “Greenbacks.” Donald Trump acknowledged in 2016 that the government never has to default “because you print the money,” echoing Alan Greenspan, Warren Buffett and others. So writes Prof. Stephanie Kelton in a Dec. 2, 2024 blog.Alternatively, the Treasury could mint some trillion dollar coins. The Constitution gives Congress the power to coin money and regulate its value, and no limit is put on the value of the coins it creates. In legislation initiated in 1982, Congress chose to impose limits on the amounts and denominations of most coins, but a special provision allowed the platinum coin to be minted in any amount for commemorative purposes. Philip Diehl, former head of the U.S. Mint and co-author of the platinum coin law, confirmed that the coin would be legal tender:
In minting the $1 trillion platinum coin, the Treasury Secretary would be exercising authority which Congress has granted routinely for more than 220 years … under power expressly granted to Congress in the Constitution (Article 1, Section 8).
To prevent congressional overspending, a budget ceiling could be imposed – as it is now, although the terms would probably need to be revised.
Eliminating the Debt
Those maneuvers would prevent the federal debt from growing, but it still would not eliminate the trillion dollar interest tab on the existing $36 trillion debt. The only permanent solution is to eliminate the debt itself. In ancient Mesopotamia, when the king was the creditor, this was done with periodic debt jubilees — just cancel the debt. (See Michael Hudson, And Forgive Them Their Debts.) But that is not possible today because the creditors are private banks and private investors who have a contractual right to be paid, and the U.S. Constitution requires that the government pay its debts as and when due.
Another possibility is a financial transaction tax, which could replace both income and sales taxes while still generating enough to fund the government and pay off the debt. See Scott Smith, A Tale of Two Economies: A New Financial Operating System for the American Economy (2023) and my earlier article here. But that solution has been discussed for years without gaining traction in Congress.
Another alternative is to have the Federal Reserve buy the debt as it comes due. For the last few years, the Treasury has been issuing an estimated 30% of its debt as short-term bills rather than 10-year or 30-year bonds. As a result, in 2023 approximately 31% of the outstanding debt came due for renewal. As usual, it was just rolled over into new debt. But the nearly one-third coming due in FY2025 could be bought in the open market by the Federal Reserve, which is required to return its profits to the government after deducting its costs, making the debt virtually interest-free. Interest-free debt carried on the books and rolled over does not raise the federal deficit. If a third of the outstanding debt is too much to monetize in one year to avoid inflation, this maneuver could be spread out over a number of years.
Mandating that action by an “independent” Fed would require an amendment to the Federal Reserve Act, but Congress has the power to amend it and has done so several times over the years. The incoming Administration is proposing more radical moves than that, including eliminating the income tax, ending the Fed, auditing the Fed, or merging it with the Treasury.The federal interest tab nearly doubled after April 2022, when the Fed initiated “Quantitative Tightening.” It reduced its balance sheet by selling over $2 trillion in federal securities into the economy, reducing the money supply, and by hiking the federal funds rate to as high as 5.5%. Arguably the Fed has overtightened and needs to reverse that trend by buying federal securities, injecting new money into the economy.
How to Avoid Hyperinflation
Alarmed economists contend that a Weimar-style hyperinflation is the inevitable outcome of government-issued money. But as Michael Hudson points out, “Every hyperinflation in history has been caused by foreign debt service collapsing the exchange rate. The problem almost always has resulted from wartime foreign currency strains, not domestic spending.”
Issuing the money directly will not inflate prices if the funds are used to increase the domestic supply of goods and services. Supply and demand will then go up together, keeping prices stable. This has been illustrated historically, perhaps most dramatically in China. The People’s Bank of China manages the money supply by a variety of means including just printing currency. In 28 years, from 1996 to 2024, China’s money supply (M2) grew by 52 times or 5,200%, yet hyperinflation did not result. Prices remained stable because the funds went into increasing GDP, which went up along with the money supply.
Price inflation during the Covid crisis has been blamed on the Fed monetizing Congressional fiscal payments to consumers and businesses, increasing demand (the circulating money supply) without increasing supply (goods and services). But the San Francisco Fed concluded that the surge in global shipping and transportation costs due to COVID, along with delivery delays and backlogs, were a greater contributor than this fiscal stimulus to the runup of headline inflation in 2021 and 2022. The supply of goods could have been increased – producers could have increased production to respond to the increase in demand — were it not for the shutdown of more than 700,000 productive businesses labeled “non-essential,” resulting in the loss of three million jobs.
Swapping Debt for Productive Equity
Money printing is not inflationary if the money is issued for productive purposes, raising GDP in lockstep; but how can we be sure that the new money will be used productively? Today the banks and other large institutions that first receive any newly-issued money are more likely to invest it speculatively, driving up the price of existing assets (homes, stocks, etc.) without creating new goods and services.
Economic blogger Martin Armstrong observes that one solution pursued by debt-ridden countries is to swap the debt for equity in productive assets. This has been done by Mexico, Poland, Croatia, the Czech Republic, Hungary, and the United States itself. It was the solution of Treasury Secretary Alexander Hamilton in dealing with the overwhelming debt of the First U.S. Congress. State and federal debt was swapped along with gold for shares in the First U.S. Bank, paying a 6% dividend. The Bank then issued U.S. currency at up to 10 times this capital base, on the fractional reserve model still used by banks today. Both the First and the Second U.S. Banks were designed to support manufacturing and production, according to Hamilton’s Report on Public Credit.
Following the Hamiltonian model is H.R. 4052, the National Infrastructure Bank Act of 2023 (NIB) now pending in Congress. The NIB proposal is to swap privately-held federal securities (Treasury bonds) for non-voting preferred stock in the bank. Interest on the bonds would continue to go to the investors, along with a 2% stock dividend. That would not eliminate the debt or the interest, but if the Federal Reserve were to buy federal securities on the open market and swap them for NIB stock, the securities would essentially remain interest-free, since again the Fed is required to return its profits to the Treasury after deducting its costs.
Lending Directly to Productive Businesses
Another possibility for using newly issued money to increase the supply of goods and services is for the Federal Reserve to make loans directly to productive businesses. That was actually the intent of the original Federal Reserve Act. Section 13 of the Act allows Federal Reserve Banks to discount notes, drafts, and bills of exchange arising out of actual commercial transactions, such as those issued for agricultural, industrial or commercial purposes – in other words, lending directly for production and development. “Discounting commercial paper” is a process by which short-term loans are provided to financial institutions using commercial paper as collateral. (Commercial paper is unsecured short-term debt, usually issued at a discount, used to cover payroll, inventory and other short-term liabilities. The “discount” represents the interest to the lender.)According to Prof. Carl Walsh, writing of the Federal Reserve Act in The Federal Reserve Bank of San Francisco Newsletter in 1991:
“The preamble sets out very clearly that one purpose of the Federal Reserve Act was to afford a means of discounting commercial loans. In its report on the proposed bill, the House Banking and Currency Committee viewed a fundamental objective of the bill to be the “creation of a joint mechanism for the extension of credit to banks which possess sound assets and which desire to liquidate them for the purpose of meeting legitimate commercial, agricultural, and industrial demands on the part of their clientele.”
Cornell Law School Professor Robert Hockett expanded on this design in an article in Forbes in March 2021:
[T]he founders of the Federal Reserve System in 1913 … designed something akin to a network of regional development finance institutions. … Each of the twelve regional Federal Reserve Banks was to provide short-term funding directly or indirectly (through local banks) to developing businesses that needed it. This they did by ‘discounting’ – in effect, purchasing – commercial paper from those businesses that needed it … [I]n determining what kinds of commercial paper to discount, the Federal Reserve Act both was – and ironically remains – quite explicit about this: Fed discount lending is solely for “productive,” not “speculative” purposes.
Today discounting commercial paper is big business, but the lenders are private and the borrowers are large institutions issuing commercial paper in denominations of $100,000 or more. Except for its emergency Commercial Paper Funding Facility operated from 2020 to 2021 and from 2008 to 2010, the Fed no longer engages in the commercial loan business. Meanwhile, small businesses are having trouble finding affordable financing.
In a sequel to his March 2021 article, Hockett explained that the drafters of the Federal Reserve Act, notably Carter Glass and Paul Warburg, were essentially following the Real Bills Doctrine (RBD). Previously known as the “commercial loan theory of banking,” it held that banks could create credit-money deposits on their balance sheets without triggering inflation if the money were issued against loans backed by commercial paper. When the borrowing companies repaid their loans from their sales receipts, the newly created money would just void out the debt and be extinguished. Their intent was that banks could sell their commercial loans at a discount at the Fed’s Discount Window, freeing up their balance sheets for more loans. Hockett wrote:
The RBD in its crude formulation held that so long as the lending of endogenous [bank-created] credit-money was kept productive, not speculative, inflation and deflation would be not only less likely, but effectively impossible. And the experience of German banks during Germany’s late 19th century Hamiltonian ‘growth miracle,’ with which the German immigrant Warburg, himself a banker, was intimately familiar, appeared to verify this. So did Glass’s experience with agricultural lending in the American South.
Prof. Hockett suggested regionalizing the Fed, expanding it from the current 12 Federal Reserve banks to many banks. He wrote in August 2021:
In time, we might even imagine a proliferation of public banks, patterned more or less after the highly successful Bank of North Dakota model, spreading across multiple states. These banks could then both afford nonprofit banking services to all, and assist the Fed Regional Banks in identifying appropriate recipients of Fed liquidity assistance.
The result, he said, will be “a Fed restored to its original purpose, a Fed responsive to varying local conditions in a sprawling continental republic, a Fed no longer over-involved with banks whose principal if not sole activities are in gambling on price movements in secondary and tertiary markets rather than investing in the primary markets that constitute our ‘real’ economy. It will mean, in short, something approaching a true people’s bank, not just a banks’ bank.”
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Sorry, i did not have the time to read it, but…
Somebody said:” As long as be people can vote to receive goodies…”
Which mean that democracy is about buying vote, not be fiscally responsable.
I read about 1/3 of EB’s silly nostrums, and esp. enjoyed the “trillion dollar coin” thingy.
plz send me one of them.
this aside, the Jew-S gubmint is so deep in the debt/entitlements trap that, short of defaulting on interest payments – which will happen bye-and-bye (c. 2030-2035, maybe sooner), there is no way out other than said default. Which will lead to cascading defaults everywhere else in our top-down Ponzi’conomy and a deflationary depression that will make the 1930’s look like raging prosperity.
no big deal tho. ZOG-tolerant ‘Murka deserves it.
P.S. Kill the Bank. That’s what it sez on Andrew Jackson’s gravestone: “I killed the Bank”. And he was right.
The “constitutional injunction” against default is a weakly worded clause
in the Fourteenth (= never properly ratified and therefore null and void)
and pertains to debt from the War of Northern Aggression;
I have held to everybody´s nauseam that America´s foundational Sin was
the quashing of Shays´Rebellion (for the promised American Jubilee) –
Washington mobilized more men against the veterans than at any one time against
the Brutish – so the priorities were clear from the beginning;
it is time to rectify that – and make it worldwide 😖
If loans are made with money created out of thin air, they constitute a form of printing money, and since it is created out of thin air, no one cares if it is not paid, but after it circulates, it is the same as any other currency and has the same effects as the money that circulates.
Furthermore, the money that is given away for wars returns, and when it does, it will be part of national consumption and will affect the economy.
Bitcoin was invented to hide dirty money, but when Bitcoins are bought, the dirty money remains in circulation.
The fact is that the economy needs honesty and that no longer exists in the country.
Please excuse my ignorance and enlighten me as to the machinations of the Federal Reserve system.
There is a constant alarm sounded over the ridiculous national debt and particularly over the massive unpayable interest on the debt.
To whom exactly is the national debt and it’s accumulated interest paid back to?
Where does it actually go? Is it not simply a number on a computer, an amount agreed upon.
The Fed creates the money out of thin air, then lends this thin air money to banks, who in turn lend up to ten times the thin air money amount to the public, who must then pay the printed version thin air money back to the bank, and if they can’t then they declare themselves bankrupt, the loss is the banks and is not passed back to the fed as the bank’s reserve holdings should cover what they owe the fed.
These are all electronic entries on a ledger to keep the economy going, which is fine, however why then the big deal about the massive unpayable interest due on the gigantic imaginary national debt?
Surely it’s all based on imaginary debt, the only thing that makes it appear real is when we all collectively believe it to be real.
Theoretically the national debt could be forgiven tomorrow, the outstanding amount written down and set back to zero and we could start all over again. If this was done, who exactly would be the people that owned the cancelled debt?
If you borrow “money” for a house or land, the banksters spit out zeros, so their computers gloves.
You have several different bandits which gives out “money”, all are parasites.
This is the simple truth about “money”, to apply parasites on your neck, and make you a slave.
There is no freedom or escape either personal or financial from the U.S. government. A true patriot named Gordon Kahl attempted to free himself back in the 1980’s. For this he was labeled a traitor and an antisemite. And for refusing to pay Federal income tax Mr. Kahl was hunted down and assassinated on June 3, 1983 by the FBI and U.S. Marshals. To make it look good the Feds made sure a local sheriff made the kill shot, a 41. magnum round to the head.
Once again Mr ‘Solutions’, you’re evidently lacking a solution when you write:
The debt is far from imaginary – it is very REAL.
So, let’s start with these back-of-the-envelope figures which are approximately correct and representative of the U.S Gubmint’s position:
1) The USG takes in about $4 trillion is tax receipts (income tax, corporate tax, excise from tariffs etc).
2) It spends about $6 trillion on: Endless wars to prop up the Apartheid Israeli state and that sweaty poisonous dwarf Zelensky, Green energy boondoggles like those bird chopping wind turbines, inefficient solar panels, subsidising those self combusting EV lemons, welfare largesse etc.
ie: the USG runs a $2 billion deficit which it needs to fund by borrowing.
So, the U.S treasury will sell a variety of bonds (eg: 5yr, 10yr, 30 yr and short dated bonds), which were typically bought by foreigners in the past.
The money raised by these bonds will fund the budget deficit for that year.
Well, the U.S has been living beyond its means for decades, consistently running budget deficits. And these deficits have accumulated so that today there exists a $36 trillion national debt.
And, seeing as foreigners tend to buy mostly long dated bonds (like the benchmark 10 yr), the rate of interest on that at this very moment is around 4.2%.
If, for the sake of argument, I said that the entirety of the U.S debt bond repayments were in 10 yr treasuries, then 4.2% of $36 trillion= $1.5 trillion* in interest repayments that have to be made to bond holders.
(*This is actually very close to what the USG is repaying – it’s actually a little less, seeing as the interest repayments on some of the bonds were secured at a lower rate in the past).
The good news is that foreigners are buying less and less USG government bonds.
But since those budget deficits need to be funded, the ZOG owned Federal Reserve is stepping up to the plate and digitally conjuring those USD needed to buy the shortfall.
This entails that more and more trillions are being created out of thin air that now chase a more or less fixed amount of world output each year (output does increase marginally, but the rate of creation of USD is far greater).
This is good news because the deficits will get larger, the Fed will print more and more, and this cycle will spiral out of control until the USD loses world reserve currency status.
This will result in something approaching hyperinflation in the U.S, as all the USD overseas come flooding back to purchase anything of value before the USD becomes completely worthless.
And, once the USD loses most of its purchasing power, the ability of the U.S to engage in its murderous foreign misadventures will greatly diminish. This is the GREAT NEWS.
Let’s hope that happens soon.
BTW, the stats for the USG budget deficit are actually WORSE than the figures I posted above would suggest.
So, take for example student debt, which was $1.74 trillion as of Sept, 2023 (no doubt even worse today). And, when the USG funds student debt, this figure is NOT COUNTED in the $6 trillion of budget outlays.
That’s because there is some accounting chicanery going on here, whereby the student debt is defined as an ‘OFF BUDGET’ item. And, in addition to student debt, there are countless scores of billions allocated each year to other ‘off budget’ items.
BUT, the USG still needs to borrow to pay for these off budget expenditures, and thereafter pay interest on the borrowings.
All humane and peace loving people of the world pray that the USD loses its world reserve currency status soon. Because this will herald a period of peace and prosperity, the likes of which the world* has never known.
(*Of course I mean the world, OTHER THAN the three heads of the hydra – the U.S/Britain/Apartheid Israel. The U.S will resemble a Mad Max post armageddon movie set, as angry/hungry/unemployed mobs loot and pillage, cities will be burning.
It’ll be like the BLM riots – only multiplied by one hundred or more).
As the saying goes: ‘As you sow, so shall you reap’.
Well, the Anglo-Zionist empire (and especially the Great Satan itself – the USSA), has been sowing the seeds of death and despair around the world for many decades now.
And the bad karma generated from that depravity will hit Americans like a tidal wave.
https://www.zerohedge.com/markets/heres-who-owns-us-debt
Thanks
And once again ‘Truth Vigilante’ opens his comment with a put down.
Thanks for the lengthy reply though, I think you partially answered my question.
USA bond holders own the debt, and they expect a steady interest payment on their investment in the conjured debt.
Surely these same bond holders should well understand the negative trend game that they have invested into – investing in money pulled out of thin air seems more like a gamble does it not or taking advantage of the apparently official / legitimate Government Ponzi scheme (even though the Federal Reserve Bank casino is privately owned).
So when the casino eventually folds or the debt is cancelled, maybe I should have asked who is the ‘innocent’ party left holding the bag.
The same privately owned Federal Reserve Bank officials (casino operators) who run the official / legitimate Government Ponzi scheme are also responsible for the hyperinflation that kicks in during the end game (bubble) of the current lending cycle. The solution is once all the monopoly players are wiped out (those left holding worthless government bonds and other smaller reserve banks) is to rename the currency and it’s value and to start another lending cycle, as was done in the Weimar republic scenario.
Otherwise, from the rest of your comments I think we’re on the same page.
The best way to fund debt is to be Hegemon and never pay anything back, who’s going to ask for their money back, and who is going to stop paying the gangster protection racket?
And you also fight wars using the other guys assets to pay for it.
Samson slew the philistines with the jawbone of an ass, where the modern version is the Russians are being slayed by a fat ass in the form of the head of the treasury department, with Russian ass-ets.
Once 300 billion is spent the war ends, Russia would have then funded both sides, what a massive blunder that was by Russia.
Fiscal rectitude seems “old school” thinking, if you need money just print it is the mindset of they day.
It has come to the point where those who are supposed to oversee government spending actively participate in the running up of debt because it benifits their groups’ projects.
Its time for an overhaul of the rules and regulations on spending, government should be held to a limit to what they can spend in their term, if they can get the economy in good shape then they can get a bonus package, a bit like Ukraines war funding the worst you perform the more you get.
Each successive government now seems to try and out-do the last in how much debt they can run-up…it has to stop, either by self control or by the law of markets…with a crash.
I like Ellen Brown and admire her relentless years-long hard work to reform the very broken US financial system, however she is missing some essential basic things.
The real economy for any nation are the useful physical things and services provided and the ability of the public to be allowed to obtain these as required.
The money system is a man made tool – or specifically an accounting procedure – that facilitates the collective effort that a modern production system requires. And then provides for the distribution of that production to the consumers, which is (or at least should be) everyone. Any claims that money is anything other than a man-made accounting mechanism for facilitating these two functions just causes confusion and helps to wrongly elevate in our minds the false believe that money is something that it isn’t.
A proper national accounting practise in every nation is urgently needed to ensure that collectively in any given period of time there is the correct amount of purchasing power distributed to the citizens of a nation to buy without debt what goods have gone onto the market. If this was done then just as at present, but with greater personal financial freedom, consumers will dictate to producers what they want, or don’t want and in what quantity.
If a bus has 50 seats available for a trip from one location to another the bus company issues up to 50 tickets. Not 100 or 25. But 50. The managers of a bus company have more sense than modern trained bankers, economists and politicians.
For a variety of reason, but primarily the replacement of labour by machines in production, there is always in any given period of time a “gap” between how much businesses need to charge to recover their financial costs and how much purchasing power is distributed to consumers. This “gap” has existed for a long time and just gets bigger with time and is the main cause of national debts.
It is not caused by a nation or a people “living beyond their means”. That’s a totally doppy argument. In real physical terms no one or no nation can live beyond their means. And put into it’s correct place the issue and spending of money must parallel the material and labour requirements of the production system and of consumption.
Studies done over 100 years ago showed that with increasing mechanisation less labour is required to make what a modern society needs. Up till now this has simply caused governments to create work frequently by enormous expansions of bureaucracies so that we head increasingly towards a totalitarian slave state. If a “dividend” is issued to all citizens equally which is issued because the production system doesn’t distribute sufficient purchasing power to buy what’s been made this would cease the need for banks to issue money for consumption. Administered properly the national debt would would just disappear in time.
In modern societies we have been conditioned to think with puritanical minds and so we instinctively think such a policy will lead to evil. But what could be more evil that what presently exists? What we presently do is say we cannot consume what nature (God actually) has provided without being permanently under the heel of private bankers who actually simply create what they presently issue. In essence we presently merely rent our money from the banks under onerous terms.
Such a system existed and worked magnificently prior to the introduction of the ZOG owned Federal Reserve.
It was called The Classical Gold Standard.
Under that system, not only was purchasing power preserved during the 19th century, but a dollar in 1900 had MORE purchasing power* than it had in 1800 – and all that was achieved in the context of far higher wages for the average worker in nominal terms.
(*And we’re not talking just a few percentage points more purchasing power either. A dollar in 1900 had more purchasing power by a WIDE MARGIN than it did one hundred years earlier).
That’s what a Gold Standard, in conjunction with unfettered Free Market Capitalism and Minimal Gubmint (or at least as close to that ideal as any nation has come to in all of recorded history), will deliver every time.
You heard right. Under a Gold Standard, despite there being some episodes of severe inflation in the mix (esp. during The War of Northern Aggression – which is falsely referred to by some as the American Civil War), the 19th century as a whole brought DEFLATION.
And this should surprise no one. Because inflation is ALWAYS and EVERYWHERE a monetary phenomenon. In other words, if you print/digitally conjure trillions of your currency, you will get runaway inflation.
If you keep the money supply constant (or at least increase it incrementally, always ensuring the growth/productivity outpaces the rate of money creation), then you get DEFLATION. It is THAT SIMPLE.
Governments cannot conjure gold (and silver – seeing as a bimetallic standard has been the norm in most civilisations for over 5000 years), so a Gold Standard ensures fiscal RESTRAINT and responsible spending practices.
Meanwhile, you will never hear a good word about the Gold Standard spoken by economic charlatans like that voodoo economist and Marxist Michael Hudson.
In fact he smears it constantly, all the while talking up the benefits of the Fiat Monetary experiment (which has enriched his ZOG benefactors immensely).
Ellen Brown, if you’re reading this, I recall that you were on friendly terms with Hudson in the past and that you see eye to eye with him on some matters.
But, unlike Hudson, you’re certainly more sensible than he is. You’re more likely to be pragmatic and recognise a failing monetary experiment (like Fiat money), because I believe you’re not beholden to the Jewish mischief makers (like Hudson) that control the entirety of the western financial system.
So Ellen, are you willing to admit that the Fiat Monetary experiment ALWAYS ends in tears, that every nation that adopts it is, sooner or later, inundated with an inflationary tidal wave?
Sure, the USD hasn’t depreciated into worthlessness just yet and has been around for quite a while.
But that’s because it has world reserve currency status, and that has propped it up for longer than it deserves. But that exorbitant privilege will soon be coming to an end.
And when it does, the U.S will be embroiled in an inflationary depression, the likes of which no major nation has ever experienced in the post Weimar Republic era.