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View Diary: Mr. Turtle cluelessly clamors for debt limit debate that President Obama says he won't get (213 comments)

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  •  Because simply creating an extra trillion dollars (2+ / 0-)
    Recommended by:
    SoCalSal, AmericanAnt

    in US currency every time bills come due devalues the dollar.  In addition to inflation, in signals to other countries that the US will resort to "dodges" and make no effort to keep its currency stable.  If you want to see the dollar replaced as the global currency, there is no better way.

    The 14th Amendment argument is a much better approach.

    To believe that markets determine value is to believe that milk comes from plastic bottles. Bromley (1985)

    by sneakers563 on Thu Jan 03, 2013 at 08:19:05 AM PST

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    •  In theory it inflates the dollar, but not lately. (2+ / 0-)
      Recommended by:
      sneakers563, MPociask

      Currency-dog whining sounds very much like gold-bug whining. WE MUST HAVE A SOUND DOLLAR at all costs. It was bunk in 1886 and it is bunk now. When monetarist theory such as "trickle down" have been tested in the real world and they have failed.

      The tentative march toward replacement of the U.S. dollar as the world's reserve currency has begun. Sadam Hussein actively pushed for it. The Euro was created to be and, despite its manifold problems, is an increasingly strong contender.  But what really moved the world toward abandoning the U.S. dollar as its reserve currency was the 2011 Debt Ceiling debacle. The world began to realize that there were U.S. "leaders" who would hold the "the full faith and credit" of the United States of America hostage to their own narrow ideology. In 2011 the U.S. Dollar weathered that attack with a minimum of damage, but we are about to consider yet again whether or not to raise the debt ceiling and THAT is the next point of risk. Will ideologues choose yet again to tell the WORLD that the American people, through their government, is considering whether or not to repudiate their existing debt obligations?

      We shall see, but if the right-wing radicals force debate of whether or not we will pay our bills, THAT may well make the abandonment of U.S. Dollar by the world inexorable.

      •  We don't need to have a sound dollar "at all costs (1+ / 0-)
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        AmericanAnt

        but that doesn't mean that devaluing the currency willy-nilly is a good thing, either.

        I agree with almost all of your second paragraph.  If however, you believe that's a problem, then shouldn't the solution seek to avoid that outcome?  Otherwise it's a case of destroying the village in order to save the village.

        To believe that markets determine value is to believe that milk comes from plastic bottles. Bromley (1985)

        by sneakers563 on Thu Jan 03, 2013 at 08:55:26 AM PST

        [ Parent ]

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