Thanks for posting, interesting article as always.
I am an Engineer. Not sure if I have a glint in my eye, but folk should probably be wary when I try, in as few sentences as possible, to point a few things out, because expressing things is not one of my strong points, sorry for that, but here goes:
We saw the dollar value go up, in response to stimulus, which is the opposite of what we expect by the old ideas of controlled scarcity.
A lot of new, inexperienced players entered the market via apps like Robin Hood, at that time, and bought shares that didn’t make sense to seasoned investors.
Things like shares in Hertz, after it was declared bankrupt.
The law in the US even had to be changed to allow those folk to keep buying bankrupt shares.
Those new players were playing with free money.
Logically, when we get money for free, we don’t need, or even expect to get a return on it. So with free money, trading is no longer for profit. The only reasons left for folk to buy those shares, is to try to save Hertz hire cars, which everyone knows and loves.
So there we truly did vote, not for profit, but for something we really wanted to keep in the world, something wd felt was valuable to us,
We also voted to keep cruise ships, which were in trouble at the time, and even aeroplanes.
When we think of what the mechanism of profit is actually doing; it leverages us to feed from our fellow humans.
With the controlled scarcity / profit model, we are acting like a crowd of mice in a cage, with a limited amount of food to go round. Eventually, we have to consume one another, until there are too few left for any to survive.
That is what is happening to business, all around the developed world, it was something a long time coming, covid has just tipped it over the edge.
So now there is no choice but to issue stimulus.
And yet, at the time of the first stimulus, a cool three trillion per month in the US alone, the dollar rate went up, not down.
It still hasn’t collapsed.
And the gold standard is long gone.
So fiat currencies no longer track the value of gold.
That provides the odd possibility that the value of the dollar can be sustained, whilst values of traditional safe haven stores of wealth languish.
In fact, if we could be confident free money could provide a safe alternative to the old ideas of profiting from stored wealth, that confidence would manifest in languishing asset values, like maybe we are starting to see.
When we see that, we might start to wonder if we should not change our perspective of money, just a little.
It acts like a medium of empowerment, transporting wealth.
Wealth is generated when it changes hands, from one to another, not when it is in account.
So it starts to look like a physical fluid.
It turns out that it is possible to model financial circuits in that way.
When we do that, we can’t help noticing that what we are modelling is a potentially dynamic system, largely at rest.
A system of many paths, like all of the blood vessels and veins in a body.
Instead of a heart, it has the money issuing mechanism, like a pump, or high resorvoir, at the input.
And it has never really been switched on.
But it could be. If we just turned on the free money taps, and left them on.
Then we might start to wonder where all that wealth could come from, which could balance things up, the fluid resorvoir, and we might think of the sun.
After all, it is the only source of energy and wealth in our accessible universe, and it is free.
So it makes sense to issue the free money in credit, on the understanding that global solar power will be implemented, and provided at the input to the system, to keep the wealth resorvoir topped up (the fed).
Now we might also realise this automatically solves the global environmental problem.
When we look at all of that, it does maybe change the way we think about things.
At least I hope and trust it does.
After all it looks inevitable once we’ve seen it.