Hacker News Reader

Comment by aguyfromnb | Hacker News Reader

>Basically I'm preparing for a global depression

There's certainly nothing wrong with being prepared.

However, the idea that our institutions crumple but your hard currency coins are safe is naive at best. In such a scenario, if the metal has any value, either the government will confiscate it or your neighbour with the gun will take it.

>The government is injecting a massively gigantic amount of cash into the economy

What is "massive"? Right now they are talking about $2 trillion, which is about 10% of GDP. Spending 10% of 1 year of income on "maintenance" isn't scary to me.

View on HN

> What is "massive"? Right now they are talking about $2 trillion, which is about 10% of GDP. Spending 10% of 1 year of income on "maintenance" isn't scary to me.

The Quantitative Easing program from 2008-2014 (6 years duration) injected about $4T into the economy. Today, a similar amount is being injected in just 1 month, albeit by purchasing different assets.

The inflation risk is very real.

The government isn't a household.

You have to ask where those 10% are taken from so we can spend them on maintenance. The smartest move would be to immediately slash military budget in half if not more.

But it will likely be taken from education, infrastructure or healthcare/social services.

They're taken from thin air. The Fed just prints it.

Thereby devaluing the rest of the money. What that means should be abundantly clear.

The dollar is the worlds reserve currency. American printing presses have more life in them than other countries.

Look at the countries that have opposed that since the beginning of the millennium: Libya and Iraq saw, ahem, “kinetic interventions”, and Iran and Venezuela are still being crushed by sanctions for daring to price their oil in Euros and/or RMB.

Most money isn't from printing presses. Banks create money by handing out loans.

Most loans are against tangible, reposseable assets, or against future income streams. A bank that just handed out loans without commensurate interest rates to avoid the risk of default would quickly go out of business.

Take 2008, for instance. The Fed injected $4 trillion. Why? Because $4 Trillion evaporated in the crash. The result was that we didn't have a deflationary meltdown, but it didn't result in inflation.

>Thereby devaluing the rest of the money. What that means should be abundantly clear.

Have you actually looked at where the dollar has been heading, even with all of this "money printed"? Up. Way up.

Reply on news.ycombinator.com