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Re: Congratulations To Bolivarian Socialism: 

By: Decomposed in POPE IV | Recommend this post (1)
Fri, 29 Apr 16 5:28 PM | 96 view(s)
Boardmark this board | POPES NEW and Improved Real Board 		Msg. 06069 of 47202
(This msg. is a reply to 06064 by Zimbler0)
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re: "what happens when that central bank or government cannot actually afford the paper and ink with which to print that money?"

It's not exactly unprecedented. What happens next is that larger bills get produced. Rather than printing ONE THOUSAND DOLLAR bills, the country begins printing ONE MILLION DOLLAR bills. After that, it begins printing on top of its old bills.

I've got German postage stamps that were originally one hundred marks, with the word "TAUSEND" stamped after the number "100." It would be funny if it wasn't actually indicative of a German tragedy that eventually led to World War II.

Successive stamps in the collection go on to be valued in the millions, billions and even trillions of marks. 




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Gold is $1,581/oz today. When it hits $2,000, it will be up 26.5%. Let's see how long that takes. - De 3/11/2013 - ANSWER: 7 Years, 5 Months


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The above is a reply to the following message:
Congratulations To Bolivarian Socialism:
By: Zimbler0 in POPE IV
Fri, 29 Apr 16 7:06 AM 		Msg. 06064 of 47202

Congratulations To Bolivarian Socialism: Venezuela Cannot Afford To Pay For Its Own Money

http://www.forbes.com/sites/timworstall/2016/04/28/congratulations-to-bolivarian-socialism-now-venezuela-cannot-afford-to-pay-for-its-own-money/#4c7d981e4544

Here is the latest installment in our ever popular series detailing the monstrous mess that is the Venezuelan economy. The country now seems to be at the stage where it cannot afford to actually purchase its own money. And this is one of the things which a country with a fiat currency, which Venezuela does have, is never supposed to be able to do–actually run out of its own money. This is a point often made in Modern Monetary Theory, or at least at the wilder edges of that MMT.

A central bank which makes its own money cannot run out of money because it can just make some more. Which is true, in a manner, but reality does have that annoying manner of announcing itself even in the middle of the most wondrous economic theories. Because what happens when that central bank or government cannot actually afford the paper and ink with which to print that money? Don’t laugh too loudly–there have been two examples just since the turn of the millennium. Agreed, you’ve got to really, really, screw up an economy to make it true but two groups have managed even that.

(Article does continue. Zim.)

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