Wednesday, July 09, 2003 :::
Incidentally, reMany spent nothing at all each year. Is this so terrible? Isn't it just like burning the money? Is that what a wise philanthropist should do, simply burn his or her money, and make the money of others worth that much more? , it seems to me that - The money likely to be burned has probably been low velocity money for a while; what he's talking about is literally making it zero-velocity, rather than actually burning it, though he notes it amounts to the same thing. Comparing to a future in which it is spent, though, not spending it is a change. On the other hand,
- Burnt money probably ends up in the hands of the government. If monetary policy were on a fixed plan of print a fixed amount of money each year, burning money might have a counter-inflationary effect, but in the world as it is, it seems more likely that a similar amount of money (at least in terms of economic effect) would be printed by the federal reserve that wouldn't otherwise be printed.
I'll try to let this lie now until someone else gives me something to respond to.
::: posted by dWj at 12:05 PM
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