I left it on Paul Krugman’s latest op-ed suggesting that interest rates should rise to help divest the oligarchs of some of their cash. While I certainly agree that hoarding dollars should be discouraged, playing with interest rates didn’t work before and I’m not sure it will work now. If the oligarchs are sitting on cash, it’s not because they’re waiting for more, but because they’re afraid they won’t get any more if they spend what they’ve got. And Congress, which is in charge of the distribution, has given them reason (austerity and the sequester) to fear that, regardless of how irrational it is to ration an entity whose potential quantity is infinite.
It almost seems the myth about where babies come from (the storch) has been replaced by the myth about where money comes from (the banks). To be clear, babies come from intercourse and dollars come from Congress. Having dollars pass through the Federal Reserve on their way to the producers and users of goods and services doesn’t change that. Congress is responsible.
Rationing dollars to make them appear more valuable is bad stewardship. But, the biggest myth is that dollars have any intrinsic value at all. Dollars are certified records of debt, tokens of obligation, figments of the imagination. So, the notion that after 5000 years of relying on money/currency to record our debts, we’re going to give that up is preposterous. What we do have to give up is the myth that dollars are worth anything more than the cost of printing (7 cents, regardless of the bill’s denomination; nothing when it arrives as an electronic digit).
If the oligarchs are getting desperate, it’s probably because on some level they know their stash is worthless. Say it’s sort of an unknown known.
The answer to the question in the title is ‘yes.’ That’s not a surprise. The Times, having published 55 of my comments in the last year, took this one, as well. Perhaps I’m their resident crackpot from Georgia.