Re: Wall Observer BTC/USD - Bitcoin price movement tracking & discussion

The money in circulation today ($USA) is 1,18 trillion dolars [...] the projected theoretical value is 1,18 trillions of $ /21 Million Bitcoins= $56,190.47 per bitcoin.

How about the us debt + the rest of the world currencies?

We're talking about circulation (aka: the $ that can buy gramms of gold). Debt is not in circulation (or it may as well is - who knows Tongue

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About the only thing that is in circulation is debt, as even cash is debt. Someone took a loan for it to be around!!! Grin

Not necessarily true. Governments pay people for stuff all the time.

They do, but they become indebted to central banks or others to do so.

Also generally not true, most government outlays come from taxes. Only a small portion of expenditures in a given year are from borrowing.

In the US, at least, M1 is larger than the internal debt, so cash is not debt.

If the only one allowed by law to issue dollars, euros etc are banks (central and/or peripheral), and they only issue it as loans, then all money has to be debt, old or new.

Not if that debt is settled without removing the cash from circulation.

That can never happen because of interest.

Let's play a game. Suppose you are a central bank and I am a client. There's no money in circulation and you are the only one allowed to issue it. You also require interest to issue money.

Now, I request a $10 loan. With interest, you should get back $12. BUT only $10 exist. The only solution is for you to give a loan to the next client and then the next etc............ all the way to infinity. Until numbers lose their meaning!!!

I hope you understand!!!

As far as I understand, the interest is actually counted as profit, and doesn't disappear when you pay it off. It actually gets spent into the economy again, unlike the principal that do disappear when you pay it off. So you can pay off $10, then $2 gets spent into the economy, and you can try to earn that to pay off the last $2 as well (simplified). It doesn't make the system moral in any way, but I still think it's important to be correct about it.

It's not a matter of morality. It's just impossible since the $2 don't exist.

That is true. The loaned $10 is generated out of nothing by banks and the only way to create the $2 interest is to loan more money into the economy. It is a pyramid financial system. That is why the GDP has to be positive each year to avoid recession. But that requires exponential growth since it is 3% added to the previous year's 3% increase, etc.

https://www.youtube.com/watch?v=jqvKjsIxT_8