Store of Value
Friday, February 13, 2015
Indeed, global central bankers are these days at the precipice of a crisis of confidence in the “money” they too freely propagate. This runaway six-year (plus) monetary experiment should be hotly debated right now – outside the realm of political mudslinging.
Resulting wealth destruction, redistribution and misperceptions are for the most part masked so long as monetary inflation runs unabated. Hence, the more protracted the boom the greater the pressure for “activist” policy measures that inflate and obfuscate. In the end, systemic risk rises exponentially – in the face of rising perceptions of wealth and policy success – ensuring policymakers won’t either rock the boat or come clean on policy failings.
Meanwhile, the “Store of Value” issue festers. Gangrene is apparent at some extremities, as central bank “money printing” (as far as the eye can see) holds a crisis of confidence in global “money” and Credit at bay. Still, global policymakers won’t be able to create new debit and Credit electronic journal entries and convince folks it’s real wealth forever.
But could we at least debate the issue of sound money and Credit without resorting to partisan demagoguery. Considering what’s at stake, it is so pathetic it’s embarrassing.