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

[Woodznutz]

There is no "Office of Infusement" at the Fed's main building in Wash. DC where anyone can walk in and say "Yo! I want to be INFUSED!".

I know. I'm suggesting it.

 

[Toddsterpatriot]

The aggregate obligation (principal & interest) far exceeds the whole set of available money tokens. In other words, the money needed for all to pay their creditors DOES NOT EXIST.

Wrong.

[Note: “Dollar bills” being debt, are part of the 32.7 T national debt.

They aren't part of the debt.

 

[Woodznutz]

We are in a debt spiral that is totally out of control, and there is no way that this story is going to end well

Not really. If we reduced the debt by just a fraction the stock market would soar. All that is required is slight reductions in government spending, or even a brief freeze.

Also, government spending would go down a lot if people would be more responsible regard their lifestyles and finances. Welfare programs provide necessities for the poor, the unhealthy, criminals, and the indolent, however there is no productivity from these groups.

 

[expat_panama]

I know. I'm suggesting it.

huh. Somehow I just don't see the congress taking you up on that suggestion. My thinking is that we live in a world that doesn't have such an office.

 

[noonereal]

It's an inherent flaw with any usury (interest). The aggregate obligation (principal & interest) far exceeds the whole set of available money tokens. In other words, the money needed for all to pay their creditors DOES NOT EXIST.
Look at the USA's national debt.

As I tried to teach the class. This is if zero relevancy. You are repeating MAGA talking points without understanding how debt works.

Your mortgage, principle and interest far exceeds your "tokens."

It's no different for the government. Get it yet?

 

[Parker99]

As I tried to teach the class. This is if zero relevancy. You are repeating MAGA talking points without understanding how debt works.

Your mortgage, principle and interest far exceeds your "tokens."

It's no different for the government. Get it yet?

The difference is I can’t keep raising the debt ceiling like what the government does every year. You may get $500,000 but you not going get billion dollars.

The banks are more picking at paying of loan or mortgage unlike the government debt. If I make only $4,000 a year I’m not going get that loan or mortgage.

If I get $500,000 from bank and 30 years past and I still have pay the $500,000 to bank the bank is not going give me other $500,000 unlike the what the government that keeps raising the debt ceiling.

 

[Parker99]

Wrong.

[Note: “Dollar bills” being debt, are part of the 32.7 T national debt.

They aren't part of the debt.

So where are the dollar bills coming from and who is pumping the dollar bills in circulation with no obligation of debt but free money in circulation.

 

[Toddsterpatriot]

So where are the dollar bills coming from and who is pumping the dollar bills in circulation with no obligation of debt but free money in circulation.

So where are the dollar bills coming from

https://www.bep.gov/

and who is pumping the dollar bills in circulation

I get bills from the bank. Or from others who got them from the bank.

with no obligation of debt but free money in circulation.

My $20s aren't debt, even if I borrowed money from a bank.
Are your $20s debt? Do you owe interest on them, or does someone owe you?
How do you pay or collect that interest? Who do you pay or receive it from?

 

[Parker99]

That link says Bureau of Engraving & Printing is where money is printed and send to the Federal Reserve System.

And that there is $2 trillion worth of Federal Reserve notes in circulation.

https://www.bep.gov/currency

So that say the government says we need $3 trillion in circulation does BEP or the federal reserve just say okay here is $3 trillion bills free money or do they say here is $3 trillion dollars but you have pay debt of money for the $3 trillion I’m printing for you?

 

[noonereal]

The difference is I can’t keep raising the debt ceiling like what the government does every year. You may get $500,000 but you not going get billion dollars.

The banks are more picking at paying of loan or mortgage unlike the government debt. If I make only $4,000 a year I’m not going get that loan or mortgage.

If I get $500,000 from bank and 30 years past and I still have pay the $500,000 to bank the bank is not going give me other $500,000 unlike the what the government that keeps raising the debt ceiling.

You could get it if you had the credit worthiness to get it. As soon as we appear non worthy, China will no longer buy our debt. So you see it is the same.
Example, as your house appreciates, you can draw on that equity.

 

[Toddsterpatriot]

That link says Bureau of Engraving & Printing is where money is printed and send to the Federal Reserve System.

And that there is $2 trillion worth of Federal Reserve notes in circulation.

https://www.bep.gov/currency

So that say the government says we need $3 trillion in circulation does BEP or the federal reserve just say okay here is $3 trillion bills free money or do they say here is $3 trillion dollars but you have pay debt of money for the $3 trillion I’m printing for you?

So that say the government says we need $3 trillion in circulation

The government doesn't decide how many $100s the system is going to need.
The government doesn't use currency. When was the last time you used $20s
to pay a bill you owed the federal government? When was the last time the federal
government paid you with $20s?

does BEP or the federal reserve just say okay here is $3 trillion bills free money

Free money? A bank places an order for $20,000 in currency. The Fed debits their reserve
account and an armored car delivers the currency to the bank. No debt involved anywhere.

 

[Parker99]

So that say the government says we need $3 trillion in circulation

The government doesn't decide how many $100s the system is going to need.
The government doesn't use currency. When was the last time you used $20s
to pay a bill you owed the federal government? When was the last time the federal
government paid you with $20s?

does BEP or the federal reserve just say okay here is $3 trillion bills free money

Free money? A bank places an order for $20,000 in currency. The Fed debits their reserve
account and an armored car delivers the currency to the bank. No debt involved anywhere.

So printing money is only for banks? They can’t print money if the government needs money for WW3?

The Bureau of Engraving & Printing or Federal Reserve will not give money to the government if the government has no money? It is only for the banks not the government that has no money for war, disaster or lockdowns with Covid or new pandemic so on.

 

[Toddsterpatriot]

So printing money is only for banks? They can’t print money if the government needs money for WW3?

The Bureau of Engraving & Printing or Federal Reserve will not give money to the government if the government has no money? It is only for the banks not the government that has no money for war, disaster or lockdowns with Covid or new pandemic so on.

So printing money is only for banks?

The BEP prints currency because banks order it.

They can’t print money if the government needs money for WW3?

They could. You want to pay the troops with $20s?

Are you off your silly "$20s are debt" idea?

 

[Flopper]

So printing money is only for banks? They can’t print money if the government needs money for WW3?

The Bureau of Engraving & Printing or Federal Reserve will not give money to the government if the government has no money? It is only for the banks not the government that has no money for war, disaster or lockdowns with Covid or new pandemic so on.

If the government wants to finance a war they will issue treasure bills for whatever amount they need. 11% of US Money Supply is in currency. Most of it is in various types of bank deposit money markets, CDs, treasury bills, etc.

 

[Parker99]

If the government wants to finance a war they will issue treasure bills for whatever amount they need. 11% of US Money Supply is in currency. Most of it is in various types of bank deposit money markets, CDs, treasury bills, etc.

What is the difference of treasure bills vs paper money?

When did they stop printing paper money to help the government that has no money for war, disaster, pandemic so on.

 

[Woodznutz]

Here's a thought.
Reduce Federal aid to states that have large budget surpluses.
Use the funds to retire debt.

Most States End Fiscal 2023 with a Budget Surplus as Revenues Exceed Forecasts

Shows a blog entry in detail

budgetblog.nasbo.org

 

[Toddsterpatriot]

What is the difference of treasure bills vs paper money?

When did they stop printing paper money to help the government that has no money for war, disaster, pandemic so on.

T-Bills are sold at auction and earn interest.
$20s are printed and sold to banks. They earn no interest.

When did they stop printing paper money to help the government that has no money for war,

They didn't stop printing money. So what?

 

[Parker99]

T-Bills are sold at auction and earn interest.
$20s are printed and sold to banks. They earn no interest.

When did they stop printing paper money to help the government that has no money for war,

They didn't stop printing money. So what?

You just said when the government has no money they issue bonds or treasure bills and don’t go to federal reserve and say print me 3 trillion dollars for war or disaster or what ever.

 

[Toddsterpatriot]

You just said when the government has no money they issue bonds or treasure bills and don’t go to federal reserve and say print me 3 trillion dollars for war or disaster or what ever.

Right. They borrow to pay bills, they don't print.

 

[Flopper]

What is the difference of treasure bills vs paper money?

When did they stop printing paper money to help the government that has no money for war, disaster, pandemic so on.

Several things. However, the major difference is treasury bills are are redeemable at a fixed date

What is the difference of treasure bills vs paper money?

When did they stop printing paper money to help the government that has no money for war, disaster, pandemic so on.

The major difference between currency and treasury bills is that currency can be exchanged for goods and services. Treasury bills can not. However, treasure bills can be turned into currency on a specific date.

The US government has little need for currency as it pays it's bills, employee salaries and purchases with government checks.

Currency, Treasury bills, and checks issued by the US government are backed by the full faith and credit of the United States which simple means the goverment pledges to meet it's obligations.

I don't think paper money was has been used to finance a war in the last hundred years.

Here's how goverment creates money. Congress decides to finance a war against some country. They pass a bill allocating 100 billion dollars to finance the war effort. Once the president signs the bill, it becomes law. The Secretary of the Treasury authorizes the office of the budget to add 100 billion dollars to the DOD budget. They also authorize a federal reserve bank that handles goverment accounts to add 100 billion dollars to the DOD bank account. The treasury issues checks on that account to pay for the war. The Congress just created 100 billion dollars without printing a single dollar.