Re:Trillion-dollar platinum coin could be minted at the last...
by bryanlarsen on Tuesday October 05, 2021 @06:02PM
(#28766252)
The coin is used to offset bonds. It's not increasing the money supply.
The money supply is increased by government spending.
The US economy grows by approximately $700B per year. (23T * 3%). Therefore as a first approximation the money supply needs to grow at approximately $700B per year. If the government deficit is less than that, it acts as a brake on the economy.
When the government spends money, it buys stuff with that money. Whether that is inflationary depends on how rivalrous the spending is -- IOW if it's competing with private money for that stuff or it's buying stuff that nobody else would ever want to buy.
The money supply is increased by government spending.
The US economy grows by approximately $700B per year. (23T * 3%). Therefore as a first approximation the money supply needs to grow at approximately $700B per year. If the government deficit is less than that, it acts as a brake on the economy.
When the government spends money, it buys stuff with that money. Whether that is inflationary depends on how rivalrous the spending is -- IOW if it's competing with private money for that stuff or it's buying stuff that nobody else would ever want to buy.