My American magical life
Chapter 545 - 545 90 MAGA!

545: Chapter 90 MAGA!

(Daily Thousands!) 545: Chapter 90 MAGA!

(Daily Thousands!) Human history is a constant search for the right social system.

At different historical stages, there will always be those who claim they have found a perfect system.

One that could disregard factors such as the level of productive forces, technological conditions, cultural backgrounds, and be applicable to all societies.

On December 25, 1991, as the red flag slowly descended from atop the Kremlin, many once again believed that history had provided an answer.

America, as the victor of the highest intensity competition in human history, the Cold War, came to be regarded as the model and ultimate form of human society, leaving other nations with no need to explore, but only to learn and emulate.

However, the evolution of human society did not stop with their praises.

The Bahamas, a flowerbed tightly controlled in America’s backyard, has never held its fate in its own hands.

When the Bahamas began to bet on cryptocurrency, it was actually representing an underlying trend that was hidden beneath the surface.

Some people, the end-users feeding off the modern financial system, were attempting a different path.

Planes flew over the Bahamas and began to circle downwards.

In the cabin, Cheng Daqi took Mi’er’s hand, educating her about the underlying logic of cryptocurrency.

“The history of human currency can be simply summarized in three stages: the primitive stage of bartering, with actual goods serving as a universal equivalent.

Then came the stage of physical currency, which, strictly speaking, encompasses even the Bretton Woods system.

But the US dollar pegged to physical gold lacked imagination; the value of assets had to be anchored to real monetary collateral, capping the limit to capital proliferation.

Then, the credit system and fiat money appeared, capitalists began plundering wealth from the future, all-encompassing debts mortgaged future production for current value.”

19th century Americans could not possibly imagine, before the ’08 financial crisis, that to buy a house in New York, only a few thousand dollars down payment or even zero down payment was necessary.

With the help of fiat currency, humans achieved the most rapid development in history in the 21st century, as technological progress and social development unfolded at an unprecedented pace in various countries around the world to varying degrees.

However, this development gained through debt expansion came at a cost.

When the national debt became insurmountable, corporate debt took on the responsibility to alleviate the pressure.

When corporate debt also reached its limit, personal and household debt became the last reservoir.”

Cheng Daqi thought of Hua Country, whose developmental path perfectly fits the trajectory of debt expansion: state – enterprise – individual.

In the future, when Hua Country’s private household sector debt reaches its limit, Hua Country’s economy will completely enter a period of slow growth.

After Japan’s household debt was detonated by America, it faced a lost thirty years.

After America’s household debt reached its limit, it was the ’08 financial crisis (from which it has not recovered to this day, the balance sheet contraction has not outpaced the growth of debt…)

(Here’s data from America, as real estate debt is the main form of household debt and is representative.

I won’t include domestic figures as I’m not establishing policies or inserting private goods, because this matter is simply a fact…)

“Chan, you have a loophole here.

It’s not actually a problem with the debt but with the design of the system; debt itself is not wrong.”

The dark-haired wealthy woman, after all, is a big capitalist.

The sum of her debt and her family’s may be in the tens of billions, and to her, the notion that debt causes problems is nonsense.

“Of course, do you know about America’s monetary history during the Civil War?”

Cheng Daqi discussed America’s currency during the Civil War, which left Mi’er confused.

“The details are a bit vague; was there anything special about that time?”

“During the American Civil War, the Great Commander, President Lincoln, issued a type of currency called greenbacks, a state-issued and endorsed fiat currency.

However, the monarchs of Europe had already bonded with private bankers, who would not allow such a state-backed currency to emerge, as it challenged the rights of private banks to issue money.

(The nationalization of the Bank of England occurred only after it played America’s lapdog, which is absolutely preposterous).

At that time, London newspapers explicitly wrote, ‘If this financial policy, which started as a joke from North America, becomes entrenched, then governments will have cost-free money.

This money can be used to pay off debts.

This system will provide enough money to support commerce.

This will lead to unprecedented economic prosperity.

The wealthy and intelligent from around the world will go to North America.

This country will be destroyed or will destroy any monarchy.’

Later on, the greenbacks, influenced by various factors, became a failed experiment, and the pattern of currency issuance dominated by America and Europe’s private banks was set in stone, up to the present.

But a few years ago, some people realized the US dollar hegemony might dissolve, hence they tried to promote the Paris Climate Agreement, aiming to build an energy-based currency in the next stage after fiat currency.”

The dark-haired wealthy woman knew about the Paris Climate Agreement and understood it as a tool developed countries use to exploit developing ones, but she hadn’t realized the twists and turns involved.

“Chan, the oil-dollar system is already an energy-currency binding, and the Federal Reserve even backs it with America’s national debt-paying capacity as credit endorsement.

If a new currency is created, wouldn’t that be digging our own grave?”