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0 sats \ 5 replies \ @Undisciplined OP 13 Aug \ parent \ on: Tether's Circle of Death econ
I agree with you that there is a lot of organic dollar demand, from other countries managing their currencies even more poorly than the Fed does.
My preference would be that no one lend to the state, because I think they generally use those resources to make the world worse. If the video is somewhat hyperbolic, that is still the basic point.
As someone who works for the state I can tell you the state is way way to big at the moment. There are numerous issues that if you had at your company you would either be fired or go bankrupt. By far the biggest one in my eyes is how there is currently a fight going on over clawing back unused COVID funds. Republicans want to use these unused funds that are sitting around for various other things while Dems are stonewalling so the government is having to take out even more loans to be able to do pretty basic crap. It is wild and annoying as all get out.
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I'm curious if you expect to see financial regulations, at some point, that will require large public funds (like pensions or university endowments) to hold some minimum amount of treasuries. That seems like an obvious place to look to temporarily prop up this debt situation.
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I am not sure if we will see regulation to require it so to speak. Currently a ton of retirement funds hold these already and continue to purchase them. They are the target funds that people will by or that their 401k automatically puts money into for when you target to retire.
Its my belief that that already serves to prop it up as it is. Stablecoins are just another avenue to find a place that is hungry for them. It will be interesting though that as the working force shrinks how it will affect US bonds because there might not be as much internal demand if that makes sense.
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That makes sense.
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There was also the rush last year for I bonds in October or November I think because they would pay out a minimum of I want to say 4% or so no matter if the Fed slashed it down to zero again or not. That created a Treasury surge for sure I remember reading the website crashed because of the demand.
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