Re:Hyperinflation Pushes Venezuela to Print 1M-Bolivar Bills
by notahacker on Saturday March 06, 2021 @12:47PM
(#26369097)
Other things the US has which Venezuela doesnt: a diverse economy able to direct the increased money supply towards productive businesses, entrepreneurs willing to invest in fixing supply shortages because they don't fear the government will seize their assets, substantially more transparency and trust in the currency, and a lack of need to continue printing money just to pay off supporters and generals. Lack of sanctions helps a bit too.
Re:Hyperinflation Pushes Venezuela to Print 1M-Bolivar Bills
by 300bps on Saturday March 06, 2021 @11:57AM
(#26368698)
Reserve currency status has also helped us out tremendously despite being $28 trillion in debt (and growing rapidly).
Re:Hyperinflation Pushes Venezuela to Print 1M-Bolivar Bills
by JumpCrisscross on Saturday March 06, 2021 @11:59AM
(#26368727)
Maybe, maybe not. Reserve currency status keeps borrowing rates low. But it also forces a current account deficit. How those balance with respect to domestic money supply is complicated, and not necessarily one sided. Plenty of economists recommend abandoning reserve currency status to balance our monetary policy.
I think we’ll see inflation. But the U.S. is more than capable of, and has the cultural components for, implementing policies that cut the money supply. An independent Fed capable of raising rates, debt able to be peacefully wiped out through legislation and bankruptcy courts are some of the things America has that Venezuela didn’t.