Comments by "US Debt Implosion" (@timcampbell2023) on "Why a Deflationary Monetary Policy is Better" video.

  1. ​​ @EconLessons deflation collapses a debt based monetary system. Civil unrest will follow because of defaults, bankruptcies, foreclosures and the banks seizes assets. New debt money must issued to service old debt. In deflation in our system the money doesn't exist to service the massive debt. Economic implosion.
    3
  2. Deflation due to productivity benefits everyone, deflation of the money supply in a debt based fiat system like ours is catastrophic. This is something you're overlooking. Not to mention the predicament our government is in and their spending and debt load, that is a whole other problem with a deflationary policy. Debt cannot adjust its price in deflation and the government has to repay regardless of the money supply. What you're proposing doesn't work under current monetary system. 150 years ago maybe but maybe not, because if I remember correctly the FED came into existence because of problems with monetary deflation at that time.
    1
  3. Governments hate deflation, especially heavily indebted ones. They can't tax deflation but the individual benefits from increasing purchasing power even without an increase in income. They dread it, it is an existential threat to the ponzi they have set up. Central banks and governments love inflationary policy as it allows wealth transfer via dilution of the money supply, an invisible tax. They wont and cant tolerate deflationary policy by design. The FED mandate was last changed in 1977, after we came off the gold standard a few years earlier. That is around the time the fiat petrodollar system was being firmly established. The money supply afterwards took off. A policy of inflation makes alot of sense from the perspective of tax revenues. With commodity backed money it would work differently, i think the inflationary policy fits with the debt based fiat system and what the central planners want to accomplish. Edward Bernays was hired by us government in the 40s to create a religion around consumerism. It all ties together nicely. You live on a neo-fuedalistic plantation. The slaves take care of their own needs this time around and are controlled through the system of taxation, inflation, consumerism and wage slavery. Also, another point, in our debt based system deflation causes the whole system to implode, new debt has to be created to service the old debts interest you seem to look past that. This is why you are about to see a wave of foreclosures and defaults. If that wave gets too high prepare for massive civil unrest.
    1