(08-14-2021, 01:59 AM)Ashim Wrote: When governments continually borrow more than their GDP currency becomes debt, not a store of value.
Please examine the explanation video above, which has been designed to be easily followed by anyone.
Even those without any financial background.
New Currency unit are issued OUT OF THIN AIR THROUGH DEBT!
They often use many words for it, Bond, Securities, Mortgage, Credit, Loan but in essence it's the same it is DEBT.
By "Currency Unit" here are state sponsored currency such as USD, GBP, Euro etc..
New crypto currency unit (such as bitcoin) are issued through different mechanism.
However the "Fractional Reserves Banking practices" as explained in the video is applicable for any currency, including crypto currency.
Currency has no real value!
It has 'value' just because the people believe that currency has value.
The currency has real value only when it is being exchange by either goods or services. When the currency is spent!
It's the goods or services that has value, not the currency.
Quote:If the debtor can’t pay the debt then kill the debtor.
If the debtor can't pay the debt then just relieve the debt! Write off the debt! Forgive the debt!
Of course one can also kill the debtor (or the creditor) but it will not relieve the debt.
This is true for both; currency debt or non currency debt (such as karma debt)