"Now as then, a reform of the monetary order is badly needed; and the sooner the challenge of monetary reform is taken on, the smaller will be the costs of adjustment."
I live through two hyperinflations in Argentina in the late 80s early 90s, and I am witnessing the beginning of a third right now as we speak. Argentina doesn’t have very large fiscal deficit right now (compared to the US at least), but it’s credit is canceled due to events of the past (and present) and an accumulation of imbalances, combined with very irresponsible money printing, is generating inflation of aprox 10% per month and growing. It will go out of control in the next weeks and months before can be dominated, this time, with a dollarization implemented by Javier Milei, the Libertarian candidate that most likely will win the elections next Sunday (or better defined, with freedom of contract with any currency you want for any term and any rate. This basic right, believe it or not, does not exist in Argentina. That is why the people already “dollarized” the economy “de-facto” and the current government is persecuting operators of the black market (the only free market left) with the police, similar to what Hitler and Stalin did (without the cruelty to be honest). The Argentinean case is very interesting to watch, because the rest of the developed world is going exactly in the same direction: too much debt, imposible fiscal deficits, subsidies, too much regulation, high taxes, corruption, etc. Argentina got there first, but the rest of the world is following them, slowly at first but accelerating now.
You said: "...very irresponsible money printing..."
Private banks create all money, NOT government.
Government creates the paper notes and coins, but these don't become legal money until a PRIVATE BANK issues them into circulation. Governments DO NOT print and spend any money into circulation. Governments get all money from taxation and borrowing. If they could print and spend their own money, there would be no need for a national debt!
All money is created by banks issuing loans. It is impossible to repay it all because they only create the principal amount when lending, but never the additional interest that is due. Therefore, the money system is a legalized-counterfeiting debt-enslavement scam that shackles most of us into perpetual debt to private bankers.
I disagree. Let me give you a US example: Stimulus checks. The Treasury issue checks and send them directly to individuals and companies. Where are the private banks there? In Argentina that happens every month. You are right that the Treasury doesn’t issue money, it is the Central Bank or the Fed in the US. But they exchange money for bonds between them. No private banks involved in the process.
If the treasury writes a check, it comes from their checking account. The money in their account either came from taxes or from borrowing. The most recent round of big stimulus checks (during COVID) was financed by borrowing. None of the money spent by government was created by government.
When the government borrows, it first issues bonds. A bond is a promise to repay borrowed money, plus interest. These bonds are sold at auction at the Federal Reserve. Most of the buyers of bonds are huge financial entities called "Bond Dealers" aka "Primary Dealers." Where do they get the money to buy the bonds? It is created digitally in a bank's computer! Now you should see that government stimulus money is also created by private banks.
Sometimes the Fed creates money out of thin air to buy government bonds. But the 12 Federal Reserve banks are NOT part of the government. They are privately-controlled, bank-owned corporations. So, even when government stimulus check money originates with the Federal Reserve, the money is still created by PRIVATE BANKS.
The entire money supply is created by private banks. Banks create new, digital money when they lend, with no need for prior reserves or deposits. The money lent to a borrower (individual, business, or government) did not exist before the borrower signed a loan contract promising to repay the debt.
Sorry to disappoint you buddy, but the Fed is part of the Government, like all other Central Banks in the world. I don’t want to sound disrespectful, but you theories are from text books, not the real world. It is the government that de ides to print, the rest are technicalities without importance, because is that decision to print what creates inflation, and is that decision of ability what you have to attack. It is the President and the Treasury who is deciding to run 8% fiscal deficits. That is a subsidy to the private sector and also inflationary. Deficits are financed by money printing. Money printing is inflationary. The bank lending is also another form of money printing, but it is different, it could be inflationary for a while but if you eliminate the Central Bank manipulating rates and money suply, lending is not inflationary in the long term. I will be periods of expansion and periods of contraction.
Also at bank LIES dot ORG you'll see admissions from the Department of Treasury that ONLY FINANCIAL ORGANIZATIONS (banks) put cash into circulation. And that the Treasury sells all cash and coin to the bank-owned Federal Reserve Banks for the cost of production (Less than $0.20 for a $100 Note!).
Your description of government "printing money" is completely incorrect. What government is really doing is closer in fact to RUNNING UP UNPAYABLE DEBTS ON A CREDIT CARD. And where does the money come from that government borrows? It is created out of thin air in bank computers AFTER the government issues the bond.
No the Fed was created by banks, for banks, and is owned and controlled by banks. Please go to bank LIES dot ORG and see the proofs there. Chicago Fed spokesman Jerry Nelson is there on video admitting that the 12 Federal Reserve banks are "...closely-held, private corporations..." that can create new money just by writing a check! You'll also see a Federal Court ruling that says the Federal Reserve Banks ARE NOT government agencies. And you'll see written proof by the Minnesota state auditor that says the 12 reserve banks are forced to pay property taxes because they are not part of the government! (Government agencies are exempt from property tax!)
The Fed was intentionally created to trick people like you and me into believing it is part of the government. For this reason it was name "FEDERAL RESERVE", when in fact it is not Federal and has no reserves! And they designed the system so that the chairman of the Fed is appointed by the President, and the Board of Governors of the Fed IS a governmental agency. But what they don't tell you is that the Board of Governors cannot create new money; ONLY the 12 bank-owned Federal Reserve banks can create new money.
You are the one who has been duped (like the rest of us) by an elaborate deception designed to enslave you and your family to endless debt to private bankers. I hope you have the courage and open mind to explore this issue and help me fight against it.
Think about this for a moment: IF GOVERNMENT COULD CREATE MONEY AND SPEND IT INTO CIRCULATION, WHY WOULD THERE BE A $30 TRILLION NATIONAL DEBT?
Please show me proof that government creates money (money printing) and spends it directly into circulation. I have researched this subject for many years and to my knowledge there is no evidence to support what you are saying.
millei won, what do you think is next? a lot of people on twitter bullish the dollar, but, as you have said, the dollar IS already part of the economy, and many people bullish on bitcoin, i would think people would sell now instead of buy, they have hope for something better/security. let me know your thoughts
Every stock and Argentinean bond is a buy now as a short term trade, the trade will go on for a long time, but there i a lot of money to be made in bank shares, energy, sovereign bonds, etc. the convination of the man, the ideology, the marging of defeat, the allies (internal and external) and the starting point, is the best pro-market condition that I ever seen in this carear. Of course, remember that this is a distress asset, and the road will be very difficult and long, but when you see the biggest bank in the country, worth 4 Bi, when any meddium size bank is worth 15 Bi in any smaller neighbor country, you know there is an opportunity to make 100 or 200% your money. When sovereign bonds are trading at 30-40% yield, you know there is an opportunity too. The government is broke, completely broke, but the private sector is as healthy as it has ever being, no debt, liquidity in us dollar outside of the country. That money first it is going to go to financial assets, then to real economy. The positive publicity for Argentina in the next few days will attract capital to a very small capital market. It will be a long squeeze.
wow, great to hear, do you believe that milei is the like the argentinian trump? what do you think about that title? so, you believe this will boost the morale of the argentinians and help with the prosperity that it had lost..
International Media compares Milei with Trump but he is completely different. Trump is an irresponsible right wing populist, he didn’t hesitate in running big fiscal deficits and in printing money. Trump doesn’t have a predictable ideology. He is Trump. Either you follow him in every turn of you don’t. He is difficult to anticipate. Milei is a dogmatic Libertarian. If you read the same books that he read, he is very predictable. He advocates zero fiscal deficit and a small government. Trump and Milei share a lot of things because in the other side of the aisle there is full of Socialist and Globalist with very crazy ideas, but in a normal more rational world, there are differences between them. And also,Argentina is not the US, so it can’t be compared. The US is a completely different animal to manage. One size, doesn’t fit all.
All money in the Weimar system was created by 1) the privately-owned central bank (Reichsbank), and 2) Privately-owned credit banks (same as modern commercial banks).
The government printed the notes, but did not issue any of them into circulation. Only banks did this. And all money was created out of thin air by private banks issuing loans. This is the same system we have today in the USA.
I think history will repeat, and the first place could be the UK. We have influences from the USA, tied to the fortune of the EU27 and almost no real assets. One day the credit line will change.
The morals of the story is that government debt should be prohibited under all circumstances and only the government mint can create currency in the form of coin made of gold, silver and base metals. Any other way and you invite disaster.
All money during the Weimar hyperinflation and in our system is created by private banks issuing loans. So to prevent future hyperinflations, we must also abolish bank-created money.
You forgot to mention two gigantic elephants in the room:
1) The Reichsbank was privately-owned and wasn't nationalized until 1939 (Former Reichsbank president Hjalmar Schacht revealed this in his autobiography, "Confessions of the Old Wizard".
2) All money in Weimar Germany was created by the privately-owned Reichsbank and privately-owned credit banks (Fergusson reveals this in his introduction to "When Money Dies").
Therefore, when you say "the central bank turned on the printing press", you are really saying PRIVATE BANKS turned on the printing press and created hyperinflation.
The money creation system of Weimar Germany is nearly identical to the money creation system we have today in the USA. Proofs at: https://bankLIES.org
"Initially, the Reich financed its war outlays in large part through issuing debt. Total public debt rose from 5.2bn Papermark in 1914 to 105.3bn in 1918."
So which Secular Ruling Families where Financing the Germans?!
I live through two hyperinflations in Argentina in the late 80s early 90s, and I am witnessing the beginning of a third right now as we speak. Argentina doesn’t have very large fiscal deficit right now (compared to the US at least), but it’s credit is canceled due to events of the past (and present) and an accumulation of imbalances, combined with very irresponsible money printing, is generating inflation of aprox 10% per month and growing. It will go out of control in the next weeks and months before can be dominated, this time, with a dollarization implemented by Javier Milei, the Libertarian candidate that most likely will win the elections next Sunday (or better defined, with freedom of contract with any currency you want for any term and any rate. This basic right, believe it or not, does not exist in Argentina. That is why the people already “dollarized” the economy “de-facto” and the current government is persecuting operators of the black market (the only free market left) with the police, similar to what Hitler and Stalin did (without the cruelty to be honest). The Argentinean case is very interesting to watch, because the rest of the developed world is going exactly in the same direction: too much debt, imposible fiscal deficits, subsidies, too much regulation, high taxes, corruption, etc. Argentina got there first, but the rest of the world is following them, slowly at first but accelerating now.
You said: "...very irresponsible money printing..."
Private banks create all money, NOT government.
Government creates the paper notes and coins, but these don't become legal money until a PRIVATE BANK issues them into circulation. Governments DO NOT print and spend any money into circulation. Governments get all money from taxation and borrowing. If they could print and spend their own money, there would be no need for a national debt!
All money is created by banks issuing loans. It is impossible to repay it all because they only create the principal amount when lending, but never the additional interest that is due. Therefore, the money system is a legalized-counterfeiting debt-enslavement scam that shackles most of us into perpetual debt to private bankers.
Proofs galore at: https://bankLIES.org
I disagree. Let me give you a US example: Stimulus checks. The Treasury issue checks and send them directly to individuals and companies. Where are the private banks there? In Argentina that happens every month. You are right that the Treasury doesn’t issue money, it is the Central Bank or the Fed in the US. But they exchange money for bonds between them. No private banks involved in the process.
If the treasury writes a check, it comes from their checking account. The money in their account either came from taxes or from borrowing. The most recent round of big stimulus checks (during COVID) was financed by borrowing. None of the money spent by government was created by government.
When the government borrows, it first issues bonds. A bond is a promise to repay borrowed money, plus interest. These bonds are sold at auction at the Federal Reserve. Most of the buyers of bonds are huge financial entities called "Bond Dealers" aka "Primary Dealers." Where do they get the money to buy the bonds? It is created digitally in a bank's computer! Now you should see that government stimulus money is also created by private banks.
Sometimes the Fed creates money out of thin air to buy government bonds. But the 12 Federal Reserve banks are NOT part of the government. They are privately-controlled, bank-owned corporations. So, even when government stimulus check money originates with the Federal Reserve, the money is still created by PRIVATE BANKS.
The entire money supply is created by private banks. Banks create new, digital money when they lend, with no need for prior reserves or deposits. The money lent to a borrower (individual, business, or government) did not exist before the borrower signed a loan contract promising to repay the debt.
Proofs at: https://bankLIES.org
Sorry to disappoint you buddy, but the Fed is part of the Government, like all other Central Banks in the world. I don’t want to sound disrespectful, but you theories are from text books, not the real world. It is the government that de ides to print, the rest are technicalities without importance, because is that decision to print what creates inflation, and is that decision of ability what you have to attack. It is the President and the Treasury who is deciding to run 8% fiscal deficits. That is a subsidy to the private sector and also inflationary. Deficits are financed by money printing. Money printing is inflationary. The bank lending is also another form of money printing, but it is different, it could be inflationary for a while but if you eliminate the Central Bank manipulating rates and money suply, lending is not inflationary in the long term. I will be periods of expansion and periods of contraction.
Also at bank LIES dot ORG you'll see admissions from the Department of Treasury that ONLY FINANCIAL ORGANIZATIONS (banks) put cash into circulation. And that the Treasury sells all cash and coin to the bank-owned Federal Reserve Banks for the cost of production (Less than $0.20 for a $100 Note!).
Your description of government "printing money" is completely incorrect. What government is really doing is closer in fact to RUNNING UP UNPAYABLE DEBTS ON A CREDIT CARD. And where does the money come from that government borrows? It is created out of thin air in bank computers AFTER the government issues the bond.
No the Fed was created by banks, for banks, and is owned and controlled by banks. Please go to bank LIES dot ORG and see the proofs there. Chicago Fed spokesman Jerry Nelson is there on video admitting that the 12 Federal Reserve banks are "...closely-held, private corporations..." that can create new money just by writing a check! You'll also see a Federal Court ruling that says the Federal Reserve Banks ARE NOT government agencies. And you'll see written proof by the Minnesota state auditor that says the 12 reserve banks are forced to pay property taxes because they are not part of the government! (Government agencies are exempt from property tax!)
The Fed was intentionally created to trick people like you and me into believing it is part of the government. For this reason it was name "FEDERAL RESERVE", when in fact it is not Federal and has no reserves! And they designed the system so that the chairman of the Fed is appointed by the President, and the Board of Governors of the Fed IS a governmental agency. But what they don't tell you is that the Board of Governors cannot create new money; ONLY the 12 bank-owned Federal Reserve banks can create new money.
You are the one who has been duped (like the rest of us) by an elaborate deception designed to enslave you and your family to endless debt to private bankers. I hope you have the courage and open mind to explore this issue and help me fight against it.
Think about this for a moment: IF GOVERNMENT COULD CREATE MONEY AND SPEND IT INTO CIRCULATION, WHY WOULD THERE BE A $30 TRILLION NATIONAL DEBT?
Please show me proof that government creates money (money printing) and spends it directly into circulation. I have researched this subject for many years and to my knowledge there is no evidence to support what you are saying.
millei won, what do you think is next? a lot of people on twitter bullish the dollar, but, as you have said, the dollar IS already part of the economy, and many people bullish on bitcoin, i would think people would sell now instead of buy, they have hope for something better/security. let me know your thoughts
Every stock and Argentinean bond is a buy now as a short term trade, the trade will go on for a long time, but there i a lot of money to be made in bank shares, energy, sovereign bonds, etc. the convination of the man, the ideology, the marging of defeat, the allies (internal and external) and the starting point, is the best pro-market condition that I ever seen in this carear. Of course, remember that this is a distress asset, and the road will be very difficult and long, but when you see the biggest bank in the country, worth 4 Bi, when any meddium size bank is worth 15 Bi in any smaller neighbor country, you know there is an opportunity to make 100 or 200% your money. When sovereign bonds are trading at 30-40% yield, you know there is an opportunity too. The government is broke, completely broke, but the private sector is as healthy as it has ever being, no debt, liquidity in us dollar outside of the country. That money first it is going to go to financial assets, then to real economy. The positive publicity for Argentina in the next few days will attract capital to a very small capital market. It will be a long squeeze.
wow, great to hear, do you believe that milei is the like the argentinian trump? what do you think about that title? so, you believe this will boost the morale of the argentinians and help with the prosperity that it had lost..
International Media compares Milei with Trump but he is completely different. Trump is an irresponsible right wing populist, he didn’t hesitate in running big fiscal deficits and in printing money. Trump doesn’t have a predictable ideology. He is Trump. Either you follow him in every turn of you don’t. He is difficult to anticipate. Milei is a dogmatic Libertarian. If you read the same books that he read, he is very predictable. He advocates zero fiscal deficit and a small government. Trump and Milei share a lot of things because in the other side of the aisle there is full of Socialist and Globalist with very crazy ideas, but in a normal more rational world, there are differences between them. And also,Argentina is not the US, so it can’t be compared. The US is a completely different animal to manage. One size, doesn’t fit all.
Always staggering to be reminded of the sheer scale of the Weimar monetary apocalypse. A sobering read, especially today.
All money in the Weimar system was created by 1) the privately-owned central bank (Reichsbank), and 2) Privately-owned credit banks (same as modern commercial banks).
The government printed the notes, but did not issue any of them into circulation. Only banks did this. And all money was created out of thin air by private banks issuing loans. This is the same system we have today in the USA.
proofs at https://bankLIES.org
I think history will repeat, and the first place could be the UK. We have influences from the USA, tied to the fortune of the EU27 and almost no real assets. One day the credit line will change.
Keynesian economics at work. The government can do everything for you. Don’t believe anything our government tells us.
The morals of the story is that government debt should be prohibited under all circumstances and only the government mint can create currency in the form of coin made of gold, silver and base metals. Any other way and you invite disaster.
All money during the Weimar hyperinflation and in our system is created by private banks issuing loans. So to prevent future hyperinflations, we must also abolish bank-created money.
I heart Rudy's stack...
You forgot to mention two gigantic elephants in the room:
1) The Reichsbank was privately-owned and wasn't nationalized until 1939 (Former Reichsbank president Hjalmar Schacht revealed this in his autobiography, "Confessions of the Old Wizard".
2) All money in Weimar Germany was created by the privately-owned Reichsbank and privately-owned credit banks (Fergusson reveals this in his introduction to "When Money Dies").
Therefore, when you say "the central bank turned on the printing press", you are really saying PRIVATE BANKS turned on the printing press and created hyperinflation.
The money creation system of Weimar Germany is nearly identical to the money creation system we have today in the USA. Proofs at: https://bankLIES.org
read " the tower of Basel" by Adam Lebor.
It is about the Bank for International Settlement" ( BIS) in Basel, created to " facilitate" the payment of war damages from germany to france.
France did not get any monies, but hitler could through UK and US high finance with the BIS as "intermediary" , finance his warmachine.
BIS is actually putting into place Digital currency. It is ( from memory) called project " icebreaker).
"Initially, the Reich financed its war outlays in large part through issuing debt. Total public debt rose from 5.2bn Papermark in 1914 to 105.3bn in 1918."
So which Secular Ruling Families where Financing the Germans?!