Message from @Grenade123
Discord ID: 489542434221719562
I think it has. It's called a 'hair cut' the Greeks used to it.
okay, not in modern times
They understood the problem with fiat currency
deflation isn't really a problem, nor really inflation. its the rate of change that causes problems really
So Rye if your system doesn't take into account debt then I surmise there is no intrest on savings?
its not the fall that kills you, its the sudden stop.
Not true
If you fall from high enough you will have a heart attack π
well then its not hte fall that killed you still lol
So, if you bought gasoline at 2.60 a gallon, and filled a 20 gallon tank. Next day, gas is worth 2.20 a gallon...
The gas in that tank is worth the same as what you'd buy at the pump
I guess that works against my point in a sense
As far as a loan goes anyway
But ideally, if you're taking a loan, you're taking that loan for something that will add value
the problem with debt is that the debt needs to be adjusted for the rate of deflation, otherwise they are asking for more money that technically are owed
Such as property.
just like debt is adjusted over time for inflation
So it's preicated on only buying things that are neccesities. not fun alowwed
what would probably happen in deflation would be the ability to get a lower interest rate
The weird thing is a negative interest rate would be extremely gameable...
its more likely that you would see very low interest rates
because how quickly would you need to be deflating to get a negative interest rate
It'd likely be fair to waive interest.
thats more likely what would happen
with perhaps the option to get the last bit waived at the end
because it would need to devalue so fast that the amount you borrow ends up deflating so rapidly that it will cover the operating and profit margins over the course of the loan to get an interest rate of 0.
or a negative one
That seems like economy crash levels of change.
Rye here trying to push shria law over here. Fuck off undercove sand nigger
... Crap. I've been found out.
I would disagree. In my country the national bank runs negative interest rate on the accounts of the commercial banks. And the government issue bonds with a negative rate too, to discourage foreign investment in them
Where you form? Is that to discourage companies from hording money?
Denmark. Ever since the 70s the national currency has been pegged to the D-mark and later the euro
In order to keep the exchange rate constant the national bank must conduct a constrictive monetary policy
It is primarily to discourage other central banks and pension funds to not buy danish treasury bills.
The side effect is the global capital markets are funding the welfare state here.
In the late 70s early 80s the economy was in shit so the interest rate was 22% in order to keep on par with west germany.
If it's not the banks buy the bonds, who are they selling them to.
The usual suspect that buy bonds, other central banks, pension, funds sovereign wealth fund other uber rich, that have large quantities of cash they need to store inflation safely and donβt want to buy risky bonds like Greece or Italy, and must be tied to the euro
Now that I'm at a computer, and off work now...