Quote from: Clark on October 04, 2018, 02:38:29 AM

The only advantage to a money you can print on demand is that the printer can enrich politically connected parties with the new money.

The main reason that occurs is due to a lack of public awareness coupled with lack of safeguards and accountability. I'll contend: with a smaller and better informed population it becomes less feasible & less likely.

Printing money on demand doesn't have to be exclusively reserved for "connected parties" nor any single social class or demographic. With better education and accountability it could be used to fund scientific research, humanitarian causes and other ventures. In theory, this is what states do with their power. While this precedent might not be feasible or likely with large and uninformed populations, the likelihood of it occurring increases with smaller populations in offworld colonies who are better informed / educated.

It could also serve as an example for how inflationary theory should be applied in the real world which might be something currently lacking in our status quo.

Quote from: Clark on October 04, 2018, 02:38:29 AM

There is absolutely no problem keeping a money supply fixed, and increases lead to inflation. In the era of mercantilism, as gold flowed from the New World back to Western Europe, they experience long periods of inflation where before there was none. During the classical gold standard in the early-mid 19th Century, the United States experienced a prolonged deflation, with consumer goods prices falling modestly for decades. This is hugely beneficial to standards of living. A central bank would have printed its way out of the deflation, negating the benefits to the middle class.

I hate to say: macro economics vs micro economics but that is where this is leading me.

Quote from: Clark on October 04, 2018, 02:38:29 AM

Interest rates are determined on the market when demand for debt meets the supply of savings to lend. The acts of market participants set those rates. As more people save, interest rates go down. As more people demand to borrow, interest rates go up. Artificial interference in this process distorts the market and in fiat currency systems leads to the boom-and-bust business cycle.

I would love to see a more economically-literate general public

But you don't need a PhD to know that when everything in life gets a little more expensive every year, you're losing money if you save, so you should spend. This leads to more consumerism and less savings and investment, which are the only sure way to raise standards of living in the long term.

In old black and white movies the APR for a home loan can sometimes be seen @ around 2%. In past eras they don't necessarily increase beyond 2% when more people apply for credit as in past eras the mentality of "usury" and "unfair business practices" may have been more ethically tied to our culture and society. Public awareness also may have been greater with less distractions.

The idea that there are hard constants associated with printing money or interest rates which must imperatively be observed isn't an idea which appeals to me. I think our standards are determined by our overall education and knowledge. Yes, systems can be more easily manipulated and influenced negatively when information and knowledge are near all time lows. Things might substantially change for the better however under conditions where knowledge is more widely distributed.