Robert Vaughn10 said:Maria Thomas48 As stated by:
The thought is on point, but it’s incomplete. We all want to see a return that actually exceeds what we put in.
Yes, absolutely.
Even if it is... Gregory Williams7 I’ve stated it before: it is mathematically impossible for every nation to run a trade surplus at the same time.
I’m talking about achieving a better balance, not just fixing a deficit.
If some people are constantly pulling ahead, someone else is inevitably falling behind. It’s basic math—if they're always in the black, the rest of us are stuck in the red.
It doesn't hold water if you're actually creating new value.
Regarding the currency situation. The issue only exists if we end up with more domestic cash than foreign reserves. But that’s just a failure of logic. After all, what makes those foreign reserves valuable to us if our own currency holds no value for anyone else?
The reality is we’re importing twice as much as we’re exporting. In the Eurozone, import coverage sits at roughly 86% of exports.
No economy can survive with a ratio as broken as ours. Foreigners aren't interested in our currency, and frankly, they shouldn't be. That’s what the market decides—there's no arguing with that reality. If we actually focused on increasing production and exporting high-quality goods to bring in foreign exchange, maybe the conversation would be different.
Here’s the answer. When you overprint money beyond the actual value of newly created goods, that currency becomes non-convertible.
Now it’s practically impossible to convert outside the borders of the US, yet there isn't even an offering on the market.
The solution lies in fiscal discipline and production. Specifically, it comes down to that hard reality of fiscal discipline that forces your hand.
I’ve proven that creating any kind of new value requires a massive amount of capital that simply isn't there. Up until now, we've just masked the deficit by piling on debt. My findings show that within a closed system, those loans can never actually be repaid. In an open economy, Gregory Williams7 reached the same conclusion: it is mathematically impossible for everyone to maintain a trade surplus to fuel money supply. He’s right.
First, you have to actually create value. Only then can you print money to reflect that reality. Right now, we simply aren't producing enough. To get this whole engine running again, we're going to need a combination of sacrifice and much smarter capital allocation.
So, what now? Call me crazy and move on. My logical conclusions based on the evidence—which I simply copied and reformatted using different symbols—are correct.
I didn't call you crazy, and please don't drag me into that. We're just having a discussion.
You clearly can't grasp how debt is generated solely through inflation within the credit system.
Everyone is in debt, and pretty much every currency inflates.
This applies especially to the dollar, which requires massive borrowing because it's headed for a collapse soon. You need to flip your perspective on this one.☕
As far as we're concerned, we just need to reverse the trend to get debt under control. That requires sacrifice, discipline, saving, and investing. Most citizens are actually doing this, but unfortunately, the Government isn't. In that sense, GDP being tied up in debt and imports isn't as vital as increasing the share of domestic production in the GDP. If we do that, consumption becomes easy and prices stay lower.😉
Everything you said makes sense, really, but if you actually sit down and read the Federal Reserve Act, you'll see that what you're suggesting just isn't possible. A few months back, I was right there with you, thinking that’s exactly the move we need to make. But the law says no. You can't just print money to fund the government budget because the law strictly prohibits it. It doesn't matter if you create some kind of global miracle or become incredibly productive—you aren't allowed to issue real money to cover those costs. The only way to get cash is through taking out a loan, whether it's you or someone else, and then that money gets spent. It’s the same deal with the Federal Reserve statutes. There is no direct financing for the state. No free money issuance. Just loans that have to be paid back with interest. Do I really need to start quoting the actual text for you all, or are you going to go educate yourselves?
Of course, people need to work. I agree with that part. But let's be real—no amount of hard work is actually going to pull you out from under a mountain of debt. It just doesn't work like that. Even if you just look at a modest 3% inflation rate over twenty years, when you factor in a bank interest rate of 7.5%, you're looking at interest that eats away at the principal until the debt itself ends up being larger than the original amount. It's just math.
There’s this fundamental confusion when people talk about newly created value. In my view, you have to categorize it as monetary profit combined with private savings. If you take the sum of all profits—minus any losses, obviously—and add that to total savings within a closed community that isn't using credit, that number indirectly matches the community's budget deficit. It’s just basic math.
If there isn't a budget deficit, then it's just simple math. If someone is continuously generating a cash profit, then others have to take an equal amount of cash loss in total. It’s just how it works.They could have generated billions in turnover, but the actual cash loss they took just balances out against someone else's profit. It’s a zero-sum thing. You see economists constantly arguing about this, mostly because they can't agree on how to logically interpret the formulas—the ones Professor Dirk Krueger laid out in his book. I’ve actually demonstrated this with an example that nobody can really argue with. But people always seem to skip over that part.
The logical conclusion here is that...
It just doesn't work that way. You can't have one entity, or even a whole group of them, running a massive deficit forever and expecting it to just stay a bottomless pit of profit for everyone else on the profitable side. It's mathematically impossible. Eventually, the math catches up to you.The only real scenario where that works is when the entity itself is actually printing the money. In an open economy, you're looking at export revenue—which isn't exactly a universal fix for like 99% of nations out there. It would basically mean the government needs to be issuing real money.
But that's actually against the law.It’s pretty obvious that you can't just print money whenever you feel like it; there has to be some actual math behind it. Everyone is terrified of inflation. But has anyone actually looked at how our money supply was growing back in the day? It was spiking at 30% annually, and now it has dropped down to around 14%. And yet, that didn't trigger a proportional jump in inflation. The trick is all in having enough foreign exchange reserves built up from depositing loan proceeds. That's how the Federal Reserve maintained MES—macroeconomic stability—by swapping currency to cover imports.
Look, we shouldn't be obsessing over the implementation side of things right now. That’s not the real issue. The core problem is proving that there's a genuine shortage of real money supply. You can get by without addressing that for a little while, sure, but it isn't sustainable in the long run. Eventually, the economic wizards will figure out how to handle the execution part. In the US, that kind of thing is actually a relatively easy task to manage. If you actually take the time to read that response from the Treasury Department, you’ll notice how they worded it. It’s carefully crafted so they don't have to judge me or claim I’m wrong. They aren't saying I'm right either. They just frame it as choosing a different direction for economic policy. They didn't say their path is bad or flawed. They basically just said, "this is the direction we're taking because it works for us." They didn't even attempt to counter my point about how you can't pay back debt fueled by a state deficit. It makes you wonder if they're smart enough to avoid discrediting themselves as experts—both now and as things play out down the road. If I were in their shoes, I wouldn't be able to write something like, "We know you're right, but the law won't let us do better." I'd look like a complete idiot and probably lose my job on the spot. It’s easy for someone like me, a total layman when it comes to economics, to throw evidence around at actual economists. If I were an economist, the second I spoke up, I’d be labeled and discredited as an expert. I'd be out of a job. And all just to prove that I know how to think for myself? Honestly, it's a good thing I'm not an economist.
I wouldn't recommend economics students asking their professors these kinds of questions before they graduate, either. You never really know how many of them are true intellectuals and how many are just... others. Intellectuals are the ones who fight for their country using their knowledge. The others are just highly educated.
I still can't wrap my head around economists who see that my logic lines up perfectly with the situation here in the US and across the globe, yet they still insist the cause of the crisis and massive debt is something else entirely.
Even
Soimed pointed out in an old post regarding my topic that Japan has tried every possible variation of economic policy, and the result is always the same: growing debt.
Do we really need to go through everything Japan went through just to prove that high-tech equipment, education, hard work, and all that doesn't lead to lower debt? I don't think so. We have to accept the fact that besides those qualities, something else is driving the bad results. And that is exclusively the credit-based financial system. It's proven. You can't pay back budget deficit debt with more credit when there isn't a flow of real money into the system. Period.
This realization is factual. It’s not some groundbreaking discovery. The people who set up this current system know it very well. In fact, that's exactly why the system was designed this way. The reason isn't MES; it's a sneaky, wrapped-up way of stripping assets.
And now we see these supposedly great leaders in the EU acting like they're actually working to solve the Greek problem.
Everyone knows that under the current system, Greece has zero chance of paying off its debts (just like any other nation). They can't tell the truth, and handing out more credit is like trying to fill a black hole. It serves no purpose other than buying time and inflating the debt further.
The same thing awaits America. We can't pay off our debts, theoretically or practically. Even if we developed as much as Japan, we would just end up with even larger debts.
Wake up, people, before it's too late. The credit system is the sole reason for the current crisis in every nation. The system breaks every country. Developed nations face even higher totals because they had the collateral to take out even bigger loans—and loans are the only source of new money, since 95% of the money in circulation comes from credit.
So, let's start from the beginning. We need to agree on permanent ways to generate profit. The possible sources are:1 - The community budget deficit
2 - Other entities (domestic investors and consumers)
3 - Banks during periods of credit expansion
4 - Foreign investors
5 - The difference between exports and imports + foreign subsidies
In my view, the only permanent sources of profit in the current credit system are positions 1 and 3 (by taking on increasingly larger amounts of debt). Position five isn't a solution for most countries (99%).
With primary issuance via the budget, the only permanent source of profit is position 1. There is no need—and borrowing should be limited so it doesn't become impossible to repay—to take out infinite loans. Banks should probably be removed from the list of profit sources altogether because loans have to be repaid with interest. The definition of profit I'm using in my text is the monetary difference between revenue and costs. The exchange of goods and physical wealth doesn't matter here. The reason is simple: you can't pay back bank debts with physical goods.
Those are just my sound logical thoughts. You won't find these conclusions in Dirk Krueger's "Macroeconomics." Everything else is just the same old story.
That's where we need to start. Everything else is just fairy tales.
