In the past month, I’ve been learning about the U.S. economic system. To an ever-growing number of people educated in tech and finance, the U.S. government’s actions during the March 2020 COVID-19 pandemic revealed that our economy is built upon a house of cards to which more cards are added by the Federal Reserve with each stimulus package.
Here’s the gist of the situation:
- With an artificial increase of the money supply, the value of the U.S. dollar continuously depreciates. In the context of a world where other countries are also printing money, this wouldn’t be a problem. However…
- The devaluation of the dollar makes cash increasingly worth less. Cash is trash, because the influx of fiat money skyrockets the numbers in the stock market. What’s not immediately obvious, however, is that even if the stock market bounced back to previous highs, the effective value of your stock is still worth less because the stimulus has diluted the entire money supply!
- Our system is an invisible hand that tightens around the necks of the bottom 50% of Americans and young people who own 0 stocks. The wealth equality in America is unfathomable at this point, as the automation of our minimum wage jobs accelerates and the unemployed drains the last of their savings, begging for a meager $1200 while corporations (and the elite who store their wealth in them) get 10x more. America is a socialist country for the rich and powerful.
The lack of financial education for the majority of Americans means that everybody focused on identity politics and police reform, while the greatest heist in American history continues. They think the Orange Man in the White House is the problem, but he is only a herald of the dysfunction in our system of government that caters to the wealthy, corporations, and lobbyists. In many ways, who is the president doesn’t matter, because the Federal Reserve is the alpha and omega that governs — no, dictates our nation’s well-being.
The only silver-lining to this nightmare is that Universal Basic Income, a policy nobody understood when Andrew Yang was running for president, has become mainstream. UBI is the only solution that exists that deters our country from the path toward revolution. There will probably be no other choice, because none of us want to live in a society where the poor and disenfranchised are exploited until they bring out the guillotines.
I highly recommend the following video for anyone wanting to understand our economy. I’m not shilling for Bitcoin, in fact I think the key idea from this interview is the salient observations about the devaluation of the dollar and the manipulation by the Fed: