USA To Pay Off Own Debt?

So, I have been told that Congress, unable to find someone to buy off our debt, has decided to pay off our own debt by printing trillions of dollars. Because of this, mortgage rates have dropped to an all-time low, gas prices are rising, and many expect major inflation (duh).

Do you guys think this was the right decision?


I think that we were better off just keeping the debt. We could just stop handing out money irresponsibly, stop adding to things the government should pay for (meaning no more bailouts and no more socialistic things for now), and cut off some of our ridiculous spending.

Fanny and Freddy are also part of the debt that we are to pay off. Personally, I think we should just drop the organizations all together. We can hold people to their loans, but after 15 years let the people that have been unable to pay them off just keep them (of course, we wouldn't tell them this until then).

My god.

The stupidity.

We have enough to deal with already!

wait.... they are paying off a sum of money that doesn't physically exist by printing money that shouldn't exist?

Its like a math problem with Imaginary numbers.

Since when did foreigners accept fake money as payment?

The government is counterfeiting...?

money that has no real value




is what I should have said.

Mhmm...

Well, what is our money backed by? Think about it.
What is Britain's money backed by? Think about it.
What is China's money backed by? Think about it.

Currency is a medium of exchange. Instead of getting 3 coal for 5 iron ore, you get 50 gold for that 5 iron ore. You can then use that 50 gold to buy whatever you want, so much as the value covers the item.

Now, let's imagine that this is going on worldwide. People are exchanging all sorts of materials and services. Wood, Iron, Coal, Lobsters, etc. And lets say that more money is pumped into the system. Maybe the Government prints more money to pay off debt, or more people are "High Alching" mass produced Steel Platebody Armor. This means that sellers are able to demand more money for their product, and therefore your 50 gold isn't worth so much any more. It has less SPENDING POWER because of INFLATION.

The same effect can be achieved if fewer products are on the market, although this is seen less often.

On the other hand, if money is taken out of the system, or if more products are dumped onto the market, then you can buy more with that 50 Gold. This is called DEFLATION.

Note that the availability of products is different from the availability of money. Money will affect the whole system, products less so.

Now, why is this bad?

Because of the exchange medium.

Now, what if you accepted 3 Lobsters for that 5 Iron ore? Well, the price of Lobsters is often fairly constant, an average of 50 Gold if I remember correctly. So the buying power of Lobsters was more constant than other mediums, and for a while, that's what people wanted to be paid in.

Now, the US Dollar has been the favored exchange medium for a very long time, because of our reliability in making good on our debt and because we rarely go through rapid inflation or deflation.
Because of a combination of deregulation and socialism, we may now see the end of the Dollar Era.

BTW: RUNESCAPE ECONOMICS FTW!

Lol.
Runescape?!

RuneScape phails. Only thing I found interesting was the wilderness, then that was gone.

WoW makes a good epidemic simulator, Runescape makes a good economic simulator.

But what would make a good birthrate/deathrate simulator?

The amount of babies I make off those little girls and then how many I kill after.

This isn't the first time this has happened. But then, last time I checked, the depression post-World War I Germany fell into because the government tried to pay off its debt by printing lots of money was so severe that it was cheaper to burn Deutsch Marks than to buy firewood, and cheaper to line one's house with Deutsch Marks than to buy insulation. So, I'm going to say this is a bad, no, terrible idea.

Indeed. Didn't it take an excess of several million of those marks to buy a loaf of bread?

Taking a wheelbarrow full of them down to the market was a common practice.

My point isn't what its backed by, its the fact that the amount of money doesn't even exist.

There is only so much money in the world, and that debt is basically begining exceeding the amount of total cash available.

They plan to pay off this debt that shouldn't be possible by printing money that shouldn't exist.