Why the money system is flawed and why the debt cannot be paid off even if they want to?

[Toddsterpatriot]

You said, "Tell places like Zimbobwe and the Weimar Republic or Venezuela, or Argentina etc how you can just print your way out...." Again, you're an idiot because in those cases the nations were either heavily in debt in a currency they don't issue or they spent over their GDP, which I'm always saying we shouldn't do. We should keep the US Fed Gov annual budget no more than 35% GDP, preferably around 25%. A quarter of the nation's production capacity. So again, you're a retard. A Dumbass.

either heavily in debt in a currency they don't issue or they spent over their GDP,

They "spent over their GDP"? What does that even mean?

 

[Toddsterpatriot]

I actually agree with a lot of what you post. However you are incorrect here. The Federal Reserve is a private bank. It is no more federal than federal express.

The Costitutiton says that the Treasury has the power to coin money and CONGRESS (as if we want them to have this power lol) has the power to the currencies value.

This all changed in 1913 with the federal reserve act, which took that power away from the govt and gave it to a private for profit bank. The idea was that as a private bank it could regulate the currency better and more efficently than the government and thus avoid recessions and depressions.

Instead they made both worse. Our national debt is based on illegal currency. Actually all debt is in illegal currency if its denominated in federal reserve notes.

The issue is that our courts will not open that can of worms so we are literally stuck with it till it collapses. But if your the only issuer of currency, and your customers only source of dollars, and now theyre in debt to you, they will never not in a billion years ever escape. Why would you allow them out of such slavery?

The federal govt, and the federal reserve are two totally different entities. Maybe the federal govt should federalize the federal reserve instead?

The Federal Reserve is a private bank. It is no more federal than federal express.

It is actually federal. Owned by the federal government.

Maybe the federal govt should federalize the federal reserve instead?

What would that change? Be as precise as you can.

 

[Red Front]

either heavily in debt in a currency they don't issue or they spent over their GDP,

They "spent over their GDP"? What does that even mean?

Spent more (put more money into the economy) than what the nation is capable of producing (too much money, not enough goods and services).

 

[Toddsterpatriot]

the worlds central bank is called the Bank of International Settlements or BIS.

Congress does not have the legal authority, and no court will touch the subject, doesnt make it any less illegal, its the details..

The federal reserve is our central bank. doesnt make it anymore legal as there were no changes made to the constitution to allow such.

Thats why people are calling to end the fed. because its a parasitic system designed to do one thing: kill the host

The federal reserve is our central bank. doesnt make it anymore legal as there were no changes made to the constitution to allow such.

The Founders, the guys who actually wrote and ratified the Constitution, created a
central bank in 1791. Was that unconstitutional?

Thats why people are calling to end the fed.

Mostly the uneducated ones.

 

[Toddsterpatriot]

Can the Congress order the Fed to issue more currency? Can the Executive? Can SCOTUS? Can any of them order the Fed to lower or raise interest rates?

So tell me again how if Zimbabwe and the Weimar Republic had controlled their currency just printing more would have been fine....



The USD is only the reserve currency so long as the world agrees it's the reserve currency. And more importantly that large oil producing countries agree. If they start taking some other currency to buy oil..... There's no law or agreement or treaty mandating that USD be used for the purchase of oil, which is the only reason it's the reserve currency.

Can the Congress order the Fed to issue more currency?

They could. It would be a disaster if they did.

The USD is only the reserve currency so long as the world agrees it's the reserve currency.

Exactly.
That's why all those MMT pushing clowns, like Stephanie Kelton and AOC are wrong.

There's no law or agreement or treaty mandating that USD be used for the purchase of oil, which is the only reason it's the reserve currency.

That's not the only reason, but it is a big one.

 

[Toddsterpatriot]

Spent more (put more money into the economy) than what the nation is capable of producing (too much money, not enough goods and services).

It is mathematically impossible for the government to spend more than GDP.

GDP = Consumption + Investment + Government Spending + Net Exports

 

[Red Front]

It is mathematically impossible for the government to spend more than GDP.

GDP = Consumption + Investment + Government Spending + Net Exports

To print more money and buy goods and services in the economy, essentially inserting more money into it beyond the capacity of the economy to meet demand. Again, too much money in the economy chasing after too few goods and services. The federal budget should never exceed the nation's production capacity or GDP.

 

[Toddsterpatriot]

To print more money and buy goods and services in the economy, essentially inserting more money into it beyond the capacity of the economy to meet demand. Again, too much money in the economy chasing after too few goods and services. The federal budget should never exceed the nation's production capacity or GDP.

The budget can't exceed GDP, it's a math thing.

 

[Red Front]

The budget can't exceed GDP, it's a math thing.

The US FED GOV can create as much money/USD as it wants to, even depositing 10 million USD in every American citizen's checking account, but that would destroy our economy. Our economy would suffer a catastrophic failure. It would collapse within a few hours of everyone becoming a millionaire. Not enough production, to meet the demand. Too much money in the economy, and not enough goods and services.

Why are you saying the US FED GOV can't "print" a trillion, trillion, trillion dollars? It can type/print whatever it wants into the keyboard and deposit whatever amount of USD into an account at the FED. On what grounds are you saying the federal government can't create a certain amount of USD? It creates USD ex-nihilo like God created the universe. It can create whatever amount of USD it wants to create.

 

[Not That Guy]

The US FED GOV can create as much money/USD as it wants to, even depositing 10 million USD in every American citizen's checking account, but that would destroy our economy. Our economy would suffer a catastrophic failure. It would collapse within a few hours of everyone becoming a millionaire. Not enough production, to meet the demand. Too much money in the economy, and not enough goods and services.

Why are you saying the US FED GOV can't "print" a trillion, trillion, trillion dollars? It can type/print whatever it wants into the keyboard and deposit whatever amount of USD into an account at the FED. On what grounds are you saying the federal government can't create a certain amount of USD? It creates USD ex-nihilo like God created the universe. It can create whatever amount of USD it wants to create.

Your right, just not for free. We used to be able to create money from nothing, debt free. now we cant. thats the point.

 

[Red Front]

Your right, just not for free. We used to be able to create money from nothing, debt free. now we cant. thats the point.

When you say the word "debt" for the US FED GOV, what are you referring to? Do you actually believe the US FED GOV can go insolvent? Run out of USD? Run out of money? What do you mean by "debt" when applied to the US FED GOV?

 

[Toddsterpatriot]

The US FED GOV can create as much money/USD as it wants to, even depositing 10 million USD in every American citizen's checking account, but that would destroy our economy. Our economy would suffer a catastrophic failure. It would collapse within a few hours of everyone becoming a millionaire. Not enough production, to meet the demand. Too much money in the economy, and not enough goods and services.

Why are you saying the US FED GOV can't "print" a trillion, trillion, trillion dollars? It can type/print whatever it wants into the keyboard and deposit whatever amount of USD into an account at the FED. On what grounds are you saying the federal government can't create a certain amount of USD? It creates USD ex-nihilo like God created the universe. It can create whatever amount of USD it wants to create.

Why are you saying the US FED GOV can't "print" a trillion, trillion, trillion dollars?

They certainly can.
But the federal government cannot spend more than GDP, even if they print a trillion, trillion, trillion dollars.

 

[Red Front]

Why are you saying the US FED GOV can't "print" a trillion, trillion, trillion dollars?

They certainly can.
But the federal government cannot spend more than GDP, even if they print a trillion, trillion, trillion dollars.

They could spend to the point of collapsing the economy, with runaway inflation. You're just being pedantic.

 

[Toddsterpatriot]

They could spend to the point of collapsing the economy, with runaway inflation. You're just being pedantic.

They can certainly spend and/or print too much.
They just can't spend more than GDP. You're just being moronic.

 

[Red Front]

They can certainly spend and/or print too much.
They just can't spend more than GDP. You're just being moronic.

You're obviously the moronic one because the government can indeed spend more than the country's Gross Domestic Product (GDP) within a certain period, such as a fiscal year.

1. Definition of GDP: GDP measures the total value of all goods and services produced within a country's borders in a specific time period. It's a snapshot of economic output and health.
2. Government Spending: Government spending is just one component of GDP, calculated as part of the expenditure approach to measuring GDP (GDP = C + I + G + (X-M)), where:
   
   • C is consumption by residents,
   • I is investment,
   • G is government spending,
   • X is exports,
   • M is imports.
3. Spending Exceeding GDP: The government can, and sometimes does, spend more than the GDP in a given year. This usually happens through deficit spending. The total spending can surpass the total economic output (GDP) of the country.
4. Historical Precedent: There have been instances in various countries, including the U.S., where annual government spending has exceeded the annual GDP. This is often reflected in the government's budget defici. For instance, in times of significant economic distress (such as wars or financial crises), governments may inject more money into the economy than the economy's total output to stimulate growth, support employment, and provide public services.
5. Printing Money: A sovereign country that issues its own currency can spend more than its GDP because it can always create more money to finance its spending. However, unchecked spending could lead to inflation, especially if the spending greatly exceeds the productive capacity of the economy (i.e., inserting more money into the economy than it can produce in goods and services).

While it's technically possible for government spending to exceed GDP in a given period, the key considerations from an economic standpoint are the implications of such spending on inflation, debt sustainability, and overall economic health. So again you're the moron for suggesting the government can spend or insert more money into the economy than it can produce in goods and services, which is what I meant. You're being pedantic and disingenuous like always.

 

[Toddsterpatriot]

You're obviously the moronic one because the government can indeed spend more than the country's Gross Domestic Product (GDP) within a certain period, such as a fiscal year.

1. Definition of GDP: GDP measures the total value of all goods and services produced within a country's borders in a specific time period. It's a snapshot of economic output and health.
2. Government Spending: Government spending is just one component of GDP, calculated as part of the expenditure approach to measuring GDP (GDP = C + I + G + (X-M)), where:
   
   • C is consumption by residents,
   • I is investment,
   • G is government spending,
   • X is exports,
   • M is imports.
3. Spending Exceeding GDP: The government can, and sometimes does, spend more than the GDP in a given year. This usually happens through deficit spending. The total spending can surpass the total economic output (GDP) of the country.
4. Historical Precedent: There have been instances in various countries, including the U.S., where annual government spending has exceeded the annual GDP. This is often reflected in the government's budget defici. For instance, in times of significant economic distress (such as wars or financial crises), governments may inject more money into the economy than the economy's total output to stimulate growth, support employment, and provide public services.
5. Printing Money: A sovereign country that issues its own currency can spend more than its GDP because it can always create more money to finance its spending. However, unchecked spending could lead to inflation, especially if the spending greatly exceeds the productive capacity of the economy (i.e., inserting more money into the economy than it can produce in goods and services).

While it's technically possible for government spending to exceed GDP in a given period, the key considerations from an economic standpoint are the implications of such spending on inflation, debt sustainability, and overall economic health. So again you're the moron for suggesting the government can spend or insert more money into the economy than it can produce in goods and services, which is what I meant. You're being pedantic and disingenuous like always.

1. Government Spending: Government spending is just one component of GDP, calculated as part of the expenditure approach to measuring GDP (GDP = C + I + G + (X-M)), where:
   • C is consumption by residents,
   • I is investment,
   • G is government spending,
   • X is exports,
   • M is imports.

Based on this formula, does government spending increase GDP?

So again you're the moron for suggesting the government can spend or insert more money into the economy than it can produce in goods and services,

I have never suggested that. It appears that you did.

 

[Red Front]

1. Government Spending: Government spending is just one component of GDP, calculated as part of the expenditure approach to measuring GDP (GDP = C + I + G + (X-M)), where:
   • C is consumption by residents,
   • I is investment,
   • G is government spending,
   • X is exports,
   • M is imports.

Based on this formula, does government spending increase GDP?

So again you're the moron for suggesting the government can spend or insert more money into the economy than it can produce in goods and services,

I have never suggested that. It appears that you did.

It was a typo, I meant "can't spend...".

It depends what the government is spending or investing in. Based on the expenditure approach to measuring GDP, which is represented by the formula GDP = C + I + G + (X-M), government spending (G) directly contributes to and increases GDP. When the government spends money on infrastructure and public goods and services, it is essentially consuming goods and services or investing in public projects and services, which adds to the total economic output.

Here's a simple explanation:

• Direct Contribution: Government spending is a direct input in the calculation of GDP. When the government spends more money, all else being equal, GDP increases because government expenditure is part of the total output of the economy.
• Multiplier Effect: Beyond the direct contribution, government spending can also have a multiplier effect on the economy. This means that one dollar of government spending can lead to an increase in GDP by more than one dollar. This happens through a chain reaction of spending. For example, if the government contracts a construction company to build a bridge, the construction company now has more money to pay its workers and buy materials. The workers, in turn, might spend their wages on goods and services, and the material suppliers might do the same. This chain of spending continues and contributes to economic growth beyond the initial amount spent by the government.
• Economic Stimulus: In times of economic downturn, increased government spending can play a crucial role in stimulating the economy. By increasing demand through its spending, the government can help offset declines in private sector spending (C and I), leading to a stabilization or growth of GDP.

While government spending increases GDP as part of its direct calculation, the source of government funding (such as taxation) and the efficiency of the spending are crucial factors that determine the overall impact on the economy's health.

 

[Toddsterpatriot]

It was a typo, I meant "can't spend...".

It depends what the government is spending or investing in. Based on the expenditure approach to measuring GDP, which is represented by the formula GDP = C + I + G + (X-M), government spending (G) directly contributes to and increases GDP. When the government spends money on infrastructure and public goods and services, it is essentially consuming goods and services or investing in public projects and services, which adds to the total economic output.

Here's a simple explanation:

• Direct Contribution: Government spending is a direct input in the calculation of GDP. When the government spends more money, all else being equal, GDP increases because government expenditure is part of the total output of the economy.
• Multiplier Effect: Beyond the direct contribution, government spending can also have a multiplier effect on the economy. This means that one dollar of government spending can lead to an increase in GDP by more than one dollar. This happens through a chain reaction of spending. For example, if the government contracts a construction company to build a bridge, the construction company now has more money to pay its workers and buy materials. The workers, in turn, might spend their wages on goods and services, and the material suppliers might do the same. This chain of spending continues and contributes to economic growth beyond the initial amount spent by the government.
• Economic Stimulus: In times of economic downturn, increased government spending can play a crucial role in stimulating the economy. By increasing demand through its spending, the government can help offset declines in private sector spending (C and I), leading to a stabilization or growth of GDP.

While government spending increases GDP as part of its direct calculation, the source of government funding (such as taxation) and the efficiency of the spending are crucial factors that determine the overall impact on the economy's health.

While government spending increases GDP as part of its direct calculation,

So, if government spending increases GDP, how can government spending be larger than GDP?

 

[Red Front]

While government spending increases GDP as part of its direct calculation,

So, if government spending increases GDP, how can government spending be larger than GDP?

Your question reflects a misunderstanding of the relationship between government spending and GDP, as well as the temporal and structural aspects of economic measurements.

Temporal Distinctions: Government spending can exceed GDP within a specific timeframe, typically measured on an annual basis. GDP is a measure of the total economic output of a country within a year. Government spending can surpass this amount during the same period. This doesn't contradict the fact that government spending contributes to GDP; it simply means the government is injecting more money into the economy than the total value of goods and services produced in that period.

1. Stock vs. Flow Concept: GDP is a flow measure, indicating the value of goods and services produced over a specific period. Government spending is also a flow, representing money spent over the same period. The government's ability to spend more than the GDP in a year doesn't negate the contribution of spending to GDP; it reflects a policy choice to inject additional resources into the economy, possibly to stimulate growth, provide public services, or respond to crises. This distinction helps clarify that one can be larger than the other in a given period without any paradox.
2. Investment in Future Growth: Exceeding GDP in government spending can be strategic, aimed at stimulating economic growth, improving infrastructure, or enhancing human capital, which can lead to higher future GDP.
3. Practical Examples: Many countries have experienced situations where their annual government spending exceeded their annual GDP, especially during times of war, recession, or significant public investment projects. This does not imply an economic impossibility but reflects a deliberate fiscal policy choice to address specific economic conditions or objectives.

The fact that government spending contributes to and can increase GDP does not preclude the possibility of government spending exceeding GDP in a given period.

 

[Toddsterpatriot]

Your question reflects a misunderstanding of the relationship between government spending and GDP, as well as the temporal and structural aspects of economic measurements.

Temporal Distinctions: Government spending can exceed GDP within a specific timeframe, typically measured on an annual basis. GDP is a measure of the total economic output of a country within a year. Government spending can surpass this amount during the same period. This doesn't contradict the fact that government spending contributes to GDP; it simply means the government is injecting more money into the economy than the total value of goods and services produced in that period.

1. Stock vs. Flow Concept: GDP is a flow measure, indicating the value of goods and services produced over a specific period. Government spending is also a flow, representing money spent over the same period. The government's ability to spend more than the GDP in a year doesn't negate the contribution of spending to GDP; it reflects a policy choice to inject additional resources into the economy, possibly to stimulate growth, provide public services, or respond to crises. This distinction helps clarify that one can be larger than the other in a given period without any paradox.
2. Investment in Future Growth: Exceeding GDP in government spending can be strategic, aimed at stimulating economic growth, improving infrastructure, or enhancing human capital, which can lead to higher future GDP.
3. Practical Examples: Many countries have experienced situations where their annual government spending exceeded their annual GDP, especially during times of war, recession, or significant public investment projects. This does not imply an economic impossibility but reflects a deliberate fiscal policy choice to address specific economic conditions or objectives.

The fact that government spending contributes to and can increase GDP does not preclude the possibility of government spending exceeding GDP in a given period.

Your question reflects a misunderstanding of the relationship between government spending and GDP, as well as the temporal and structural aspects of economic measurements.

Your failure to answer my question reflects your failure.