My Learnings: #47

Jeff Booth, the insightful entrepreneur, author, podcaster, and Bitcoin advocate, poses a profound question: "Why is the base layer theft, and how does printing money solve anything?" Grappling with it unveils uncomfortable truths about our monetary system.

At its core, governments like the US target 2% inflation (often tolerating 3%), explicitly aiming to erode 2% of currency holders' purchasing power annually—a sanctioned form of theft. Why accept this? It stems from dilemmas like Triffin's: as issuer of the world's reserve currency, the US must print more to satisfy global demand, devaluing the dollar and subtly siphoning value from savers. Historically mild, this "hidden tax" has ballooned with mounting debt, entitlement programs, wars, and crises like COVID, exposing its pain and prompting scrutiny.

The second part is equally incisive: Printing money solves nothing sustainably. It may fund strategic asset grabs (swapping paper for resources), but ethically dubious and short-lived—as seen in waning demand for US Treasuries, with alternatives like gold gaining favor. To "solve" poverty? It merely inflates assets, enriching the wealthy while devaluing wages and savings, widening inequality. Always challenge calls for more fiat: true solutions demand addressing root causes, not perpetuating theft through debasement.