Continuous Printing Of Money Out Of Thin Air Has Never Being The Answer

[john_cm]

As a measure to curtail the household hardship instilled by the ongoing covid-19 pandemic, The United States has already pumped in $2 trillion into the public, and is currently proposing another $2.2 trillion bringing the number to more than $4 trillion. The chief cause of currency devaluation is excessive money printing by the Fed.

They print trillions out of thin air and render the value of the dollar worthless in the long run. For the records, the U.S dollar has already lost more than 96% of its value since 1913. If the same narrative was true for Bitcoin, you and I won’t probably be talking about Bitcoin, we would have counted our irredeemable losses and moved on.

With the possibility of deep inflation already knocking at the door, a commodity-backed currency or a full-scale adoption of cryptocurrency could be an answer to this continuous cycle of currency devaluation and economic meltdown. Now, the big question is, is there ever going to be a time when crypto will be fully embraced as legal tender on a global scale?

[cryptoboy007]

With continuous money printing, the world will be stuck in cycles of deep recession every decade

[Lucius]

~snip~

Some may think that printing money is an internal matter of the US, which is partly true - but since the US economy is not something that can be separated from the world economy, the whole world is likely to feel the consequences of such actions. But the US is not an isolated example of such a policy, similar things are happening in the UK and the EU, although the amounts are much smaller, and citizens do not receive stimulus checks to their home addresses.

It is obvious that there are those who advocate this model of financing and those who are against it, but I think at least two things matter throughout the story : The first is that it is easiest to follow the line of least resistance (in this case printing money), and the second is that politicians are only politicians and not experts, so we cannot expect smart moves on their part. What they are doing today is likely to have consequences for future generations, but I think they can live with it - after all, no one lives forever and only history can judge them for their mistakes.

Cryptocurrency as Bitcoin can hardly become a solution on a global scale, such an idea does not fit into the current world order, and it would be foolish to expect any change in the near future on this issue. The world will continue to live by the old rules until the current system collapses completely, and then it is possible that a new, better and fairer system will emerge.

[deisik]

As a measure to curtail the household hardship instilled by the ongoing covid-19 pandemic, The United States has already pumped in $2 trillion into the public, and is currently proposing another $2.2 trillion bringing the number to more than $4 trillion. The chief cause of currency devaluation is excessive money printing by the Fed

It shouldn't cause a significant rise in inflation rates

First, it remains to be seen how this money gets into the economy. In early 2010's the Fed ran three rounds of quantitative easing, and somehow it didn't lead to a boost in inflation. Then, if this money takes place of the money which wasn't earned, it won't cause inflation. It is kind of accounting identity (if you know what it means)

On the other hand, the money is intended to support the consumer demand as otherwise the producers will be hurt terribly (that's why it is called an economic stimulus in the first place). As such, it is much worse than inflation. Indeed, it is still a short-term measure overall, but there are sound and pretty solid reasons behind it

They print trillions out of thin air and render the value of the dollar worthless in the long run. For the records, the U.S dollar has already lost more than 96% of its value since 1913

Now come up with the stats how much wages have risen during this amount of time, just to keep things in perspective

[drlukacs]

With the possibility of deep inflation already knocking at the door, a commodity-backed currency or a full-scale adoption of cryptocurrency could be an answer to this continuous cycle of currency devaluation and economic meltdown. Now, the big question is, is there ever going to be a time when crypto will be fully embraced as legal tender on a global scale?

Do you think 21 million bitcoins can supply more than 8 billion people worldwide? Do you think bitcoin is truly valuable when there are events like Bitcoin halving or limited supply? all of that is just what Satoshi set out to control this decentralized market. This is a mechanism for those who like to manipulate and create new games without the law. Bitcoin should not be used for payment, it should only be used in decentralized markets.

[gentlemand]

Do you think 21 million bitcoins can supply more than 8 billion people worldwide?

Um, yes? Ever heard of divisibility? Ever heard of layers on top?. Bitcoin is not static. Its future is not set in stone. The potential is there for it to become whatever people decide they need it to be

[deisik]

Do you think 21 million bitcoins can supply more than 8 billion people worldwide?

Um, yes? Ever heard of divisibility? Ever heard of layers on top?. Bitcoin is not static. Its future is not set in stone. The potential is there for it to become whatever people decide they need it to be

Well, that somewhat undermines the whole idea behind it

Namely, that its future is set in stone, in a way. I've seen it a lot when people were bragging about its unchangeable, rock-solid nature like there are only 21M bitcoins to mine, reward halving coming about every 4 years, and so on. The issue of divisibility is technically irrelevant, that I agree with. However, it will become an intolerable pain in the ass economically if Bitcoin is to become a means of exchange. It won't but no one can stop from assuming that for the argument's sake

[cabron]

~snip~

Some may think that printing money is an internal matter of the US, which is partly true - but since the US economy is not something that can be separated from the world economy, the whole world is likely to feel the consequences of such actions. But the US is not an isolated example of such a policy, similar things are happening in the UK and the EU, although the amounts are much smaller, and citizens do not receive stimulus checks to their home addresses.

It is obvious that there are those who advocate this model of financing and those who are against it, but I think at least two things matter throughout the story : The first is that it is easiest to follow the line of least resistance (in this case printing money), and the second is that politicians are only politicians and not experts, so we cannot expect smart moves on their part. What they are doing today is likely to have consequences for future generations, but I think they can live with it - after all, no one lives forever and only history can judge them for their mistakes.

Cryptocurrency as Bitcoin can hardly become a solution on a global scale, such an idea does not fit into the current world order, and it would be foolish to expect any change in the near future on this issue. The world will continue to live by the old rules until the current system collapses completely, and then it is possible that a new, better and fairer system will emerge.

Those who are against this kind of financing model are the ones with huge amount of saving in their bank accounts of course they will feel like they are robbed. But for the less fortunate, they will gladly want to receive the funds to be distributed to them.

The current system I think is already collapsing and the time for the fairer system to emerge is probably today when everyone is suffering from this crisis. I think its not really Bitcoin but still an immutable blockchain of digital fiat.

[Findingnemo]

As a measure to curtail the household hardship instilled by the ongoing covid-19 pandemic, The United States has already pumped in $2 trillion into the public, and is currently proposing another $2.2 trillion bringing the number to more than $4 trillion. The chief cause of currency devaluation is excessive money printing by the Fed.

They print trillions out of thin air and render the value of the dollar worthless in the long run. For the records, the U.S dollar has already lost more than 96% of its value since 1913. If the same narrative was true for Bitcoin, you and I won’t probably be talking about Bitcoin, we would have counted our irredeemable losses and moved on.

With the possibility of deep inflation already knocking at the door, a commodity-backed currency or a full-scale adoption of cryptocurrency could be an answer to this continuous cycle of currency devaluation and economic meltdown. Now, the big question is, is there ever going to be a time when crypto will be fully embraced as legal tender on a global scale?

Central banks of every government prints money because they wanted to make up for certain situations and governments never care about the citizen all they care about the tax money so do you think they will stop printing money and will make bitcoin or other decentralized things as legal tender?

Chances are less though.

[fiulpro]

First thing I do think one should realize that Money can never be printed from thin Air .
No matter what is done , one should understand that if the government is going to print money it is going to take a toll on their values as well .
If the cryptocurrencies are doing it , it's all based on carefully calculated algorithms , plus mining does require a lot of input , one should understand that nothing can be created out of thin air. It is a lot of hardwork and years of patience.

Unfortunately government has to sometimes print money , during this pandemic they have to actually go and pay bills in the hospitals for most , they have to keep their economy running and I do think that they do know what they are doing.

[bitgolden]

If anyone wants to consider how much money is 4.2 trillion dollars, think of it this way, the average mean household income is 60 thousand dollars. 10 families makes 600 thousand, 100 families makes 6 million, 1000 families makes 60 million, 10k families makes 600 million, 100k families makes 6 billion, 1 million families makes 60 billion, 10 million families makes 600 billion and 100 million families makes 6 trillion.

So, we are talking about around 60-70 million households here, not even single person, each family could have average between 2 to 3 people. So we are talking about over 2-3 hundred million people here. YEARLY income of 250 million people could be basically the average of what we are talking about. So USA just printed one year worth of salary for 250 million people. Do you really think those people got it? Definitely not...

[coolbaughandrew]

Printing more and more money is the answer in a short period until the next hyperinflation each time. The government understands that it's ineffective, and they have to deal with it. Why? Printing money is their tool for controlling the economy. 

[wozzek23]

It has been an usual practice for all the governments to print their fiats out of no actual reserve with the plan of burning them out later. Some governments go printing money first and then start working on getting up gold reserves with taxes/interests incurred from the business which got bailed out using the newly printed money. I read USA went for bailing out few corporate after the 2008 recession but collected back all the money with least interests. We are not knowing all the diplomatic movements of governments but making opinions and suggestions based on what we do hear.

I mean that continuous printing of money may not help any government but we are not supposed to be a position to get aware of all their plans.

[Janation]

Printing more and more money is the answer in a short period until the next hyperinflation each time. The government understands that it's ineffective, and they have to deal with it. Why? Printing money is their tool for controlling the economy. 

But that also means depreciation.

The value of fiat will obviously fall down, it is not the answer nor the solution, it is the reason why there will be problems in the future and the reason why some people might turn to cryptocurrencies mainly Bitcoin.

[deisik]

The value of fiat will obviously fall down, it is not the answer nor the solution, it is the reason why there will be problems in the future and the reason why some people might turn to cryptocurrencies mainly Bitcoin

That's not always the case. If we just print an insane amount of money out of thin air and then inject all this fresh money into the economy, in normal circumstances that will most certainly result in inflation rates surging according to the famous Fisher Equation. However, this equation works both ways specifically because it is an equation, i.e. when you change one side (decrease or increase it), the other side changes proportionately

In practice, if people are not working, for example, due to quarantine (read, they are forced to stay at home), the amount of money available to households drops abruptly. Then it makes perfect sense to fill that void with helicopter money in order to keep the identity. Indeed, in the long run the production will plunge too since no one works, but there is a definite temporal lag between these two events, and filling the gap with free money is a rational choice

To sum it up, it can be a valid short-term solution (apart from other non-economic benefits)

[davis196]

As a measure to curtail the household hardship instilled by the ongoing covid-19 pandemic, The United States has already pumped in $2 trillion into the public, and is currently proposing another $2.2 trillion bringing the number to more than $4 trillion. The chief cause of currency devaluation is excessive money printing by the Fed.

They print trillions out of thin air and render the value of the dollar worthless in the long run. For the records, the U.S dollar has already lost more than 96% of its value since 1913. If the same narrative was true for Bitcoin, you and I won’t probably be talking about Bitcoin, we would have counted our irredeemable losses and moved on.

With the possibility of deep inflation already knocking at the door, a commodity-backed currency or a full-scale adoption of cryptocurrency could be an answer to this continuous cycle of currency devaluation and economic meltdown. Now, the big question is, is there ever going to be a time when crypto will be fully embraced as legal tender on a global scale?

Unfortunately,money printing is the answer for the US government,when it comes to covering their enormous budget deficit.
Funding the deficit with newly printed money by the Federal reserve system is creating the effect of the so called "inflation tax",which means that resources are being secretly taken away from the people for the government,by devaluation of the national currency.If money printing stop,can you please explain to me how the US government is going to cover their budget deficit?By rasing taxes?I don't think so.
Bitcoin is an alternative,but it will never be adopted by any government in the world.

[deisik]

As a measure to curtail the household hardship instilled by the ongoing covid-19 pandemic, The United States has already pumped in $2 trillion into the public, and is currently proposing another $2.2 trillion bringing the number to more than $4 trillion. The chief cause of currency devaluation is excessive money printing by the Fed.

They print trillions out of thin air and render the value of the dollar worthless in the long run. For the records, the U.S dollar has already lost more than 96% of its value since 1913. If the same narrative was true for Bitcoin, you and I won’t probably be talking about Bitcoin, we would have counted our irredeemable losses and moved on.

With the possibility of deep inflation already knocking at the door, a commodity-backed currency or a full-scale adoption of cryptocurrency could be an answer to this continuous cycle of currency devaluation and economic meltdown. Now, the big question is, is there ever going to be a time when crypto will be fully embraced as legal tender on a global scale?

Unfortunately,money printing is the answer for the US government,when it comes to covering their enormous budget deficit.
Funding the deficit with newly printed money by the Federal reserve system is creating the effect of the so called "inflation tax",which means that resources are being secretly taken away from the people for the government,by devaluation of the national currency.If money printing stop,can you please explain to me how the US government is going to cover their budget deficit? By rasing taxes?

The US budget deficit is financed by external actors

In this manner, it is not a "budget deficit" in the sense most people think of it (as expenditures exceeding revenues). It would be such if America were the only country out there. However, it is not, and it's other countries which are going to pay for its "deficit" (say, China, as we are already heading in that direction). But you are right that it is a tax, though this tax is levied on and paid by other nations. Basically, the US is exporting inflation, and that's one of the reasons the internal inflation rates remain anomalously low with so much "money printing"

[Ucy]

Well decentralized and safe cryptocurrency could advance in such a way that many governments will have no option than to surrender to it.
Truely decentralized cryptocurrencies are by far better than the current fiat currencies. Their core principles (like decentralization, transparency, immutablity, security, permissionless/trustless,, anonymity/privacy, censorship resistant,deflation, etc ) are part of what make them great and superior.
You could develop a great cryptocurrency project by sticking to the principles and building whatever you want that is good.

[Bezobraznike]

Well decentralized and safe cryptocurrency could advance in such a way that many governments will have no option than to surrender to it.
Truely decentralized cryptocurrencies are by far better than the current fiat currencies. Their core principles (like decentralization, transparency, immutablity, security, permissionless/trustless,, anonymity/privacy, censorship resistant,deflation, etc ) are part of what make them great and superior.
You could develop a great cryptocurrency project by sticking to the principles and building whatever you want that is good.

   I agreed with you Icy, one day we will have a crypto-world, governments will
have to surrender. That fight began, and it will last for many more years, and
money printing can accelerate economic crash.
   I also believe that crypto-currencies are superior compared with current global
economy, it's why we will win, it's why I think it's just a question of time.

[sana54210]

The thing is, where is this money going to end up with? That is a very good question to be asked. I mean the part where the people get is the part I get because they are going to spend it on what they need. However one more thing is there, the money companies gets.

These are not companies that work only in USA, these are global companies. Let's assume Apple gets some money right? I am not saying they do, but let's assume it. They are going to spend all of that money on manufacturing new phones and selling it basically everywhere in the world. What does that mean? Apple basically got all those phones for free and they made a profit from it and took all of our money whereas we actually spent real tangible money that we worked for. So basically USA does get a lot of financial profit from this printing while rest of the world may not.