Quote:
Originally Posted by HotHotHeat
In 1999 the IMF used 9 armored vehicles in the middle of the night to transport over $90 billion USD from the Argentina stock market in Buenos Aires to New York...Happened when the Argentinean economy collapsed. I know that's a different set of circumstances for a variety of reasons, but the US kinda makes it's own rules.
In terms of where the money actually comes from, obviously this money is not fiat...It's electronic. 'Making' it is as easy as typing into a computer. The idea that the US can just put as much money into the market as need be and not worry about inflation is what is so interesting. It comes from the idea that they can control the value of their currency compared to others through coupling it to things like oil, gold (although not really) and other commodities. I guess they figure as long as the world uses USD, they have a reason to be at the top. There's plenty of reason to think the US is trying to devalue their currency right now (mostly due to the Chinese owned US reserve notes).
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Exactly, but the value of the USD has also dropped which confuses me about the overall dynamics about the economy. What exactly is being exchanged here? So are we saying to the bank, on a whole, they can create $700B and not have to pay it back? Do they have to pay it back? Are we just excusing $X of bad debt? Are they writing down the books a certain way? When this idea of inserting $700B into the system (i.e. electronically) what exactly can control the cash flow, and how can it go into the wrong hands, ie. CEO's? Is there something being leveraged here and who owns it?
This idea of money and creating it an incredibly complex idea.