[quote=patb][quote=Fletch][quote=briansd1]
1) Our debt is denominated in our own currency (can devalue the debt away if needed),
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Except that isn’t almost all of our underlying debt (social security and medicare) inflation-indexed, and thus not capable of being “devalued away”?[/quote]
The government controls the index, so, they can adjust it. Also, they set the policy.
If the Feds says “OASDI Social Security Payments are
set to CPI-1.5%” that’s just what they can do.[/quote]
yeah, I’m sure that would be a smooth operation, given the Feds tract record. Just insist there is no inflation with bread at $20 a loaf. haha One of the reasons they are not supposed to inflate away long term obligations is so it does not destroy peoples lives. There is a real world attached to the monetary system and it can’t print “growth”
I’m sure the 90 trillion dollar bond market would have no trouble with that also.
As long as the bond market can punish we wont be inflating away shit. If the bond market can’t punish means the international debt financing model has broken down. That’s world I don’t think anybody wants to see, but probably will at some point
Simple fact is every country wants a lower currency than the next, today. No doubt monetary contortions will take place in the future. That much is guaranteed.
