Some Monetary Facts that Conservatives would not want you to know, actually they are too dumb to understand they think we are still under the Gold Standard and that Federal Money is limited...this is bullshit of the greatest kind China is NOT the USAs banker. The US is net exporter of aggregate demand to China. China net exporter of goods The Federal Reserve is the USA banker and the Worlds The Federal Government never borrows from anyone, it sells treasury notes and pays its interest, this creates money for the private sector. The US Treasury, not the Fed is the one that has the authority to prints money when there is need for paper currency. However most money creation happens on electronic accounts. Our monetary system is FIAT, meaning it is not tied to any metals. Money is only a promise to pay by the Treasury an IOU, but our money is the Worlds reserve currency. There is not “collateral” on government debt. The only security is the full faith of the U.S. gov. OPEC wont drop the dollar. Even then. The US wont go bankrupt. The US dollar is just a tax-credit. Gov spending finances taxation The purpose of taxation is to create constant demand for the govs money Payments on the former debt will happen as they do right now with the money coming from fiscal deficit, not taxes That before the government can tax and or loan its own money, it must first spend it into existence The government deficit = the private sector surplus The US dollar is an IOU a promise to pay backed by the treasury All dollars in the world, which is the Worlds Currency is FIAT money, IOUs There is no relation of Dollars to any metals, we went off Gold Standard in 1971 by Nixon The US Government can issue a check for any amount at anytime without causing inflation Government Spending increases Aggregate Demand since it is new money to the private sector, it has to happen before Taxes can be collected, Taxes are not needed for government to spend
Posted on: Sun, 07 Sep 2014 07:23:28 +0000
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