The US Dollar is a private currency \ stacker news ~econ

pull down to refresh

384 sats \ 25 comments \ @byzantine 22 Mar econ

The United States dollar is not owned by the US. It is a private currency owned by the US Federal reserve which is a private institution.

USDT is a private currency owed by the tether corporation

If you live in the United States, you are paid in a private currency every day in the form of federal reserve US dollars.

You can use a private currency to pay your taxes and you can take out loans that are payable in that currency from all US banks.

Tether directly competes with the federal reserve dollar, which is a product of the US federal reserve.

US treasury bills back tether in addition to other assets.

Nothing backs the US dollar except the legal history of being able to pay your debts with it, and the usefulness of its function within the banking infrastructure.

Tether is directly aligned with the United States treasury department. The federal reserve is in direct opposition to the United States treasury department.

view all related items

47 sats \ 5 replies \ @Undisciplined 22 Mar

I don't think the private/public distinction applies very cleanly with the Fed. They exist by act of Congress, have special legal protections and privileges, and their leadership are political appointees.

This is an interesting tension though between Tether and the Fed. Do you think Tether is an existential threat to the Federal Reserve System?

59 sats \ 1 reply \ @byzantine OP 22 Mar

yea tether is another private entity that competes with the fed.

it does everything that the Fed does by creating money as a way to scale US debt. The only thing it doesn't do is have the authority to set interest rates within a set of private banking institutions.

also, the notes that tether issues are not redeemable for payment of US taxes

but both institutions tether and the US Federal reserve are essentially an issuer of private currency that scales some other underlying layer

210 sats \ 0 replies \ @freetx 22 Mar

it does everything that the Fed does by creating money as a way to scale US debt. The only thing it doesn't do is have the authority to set interest rates within a set of private banking institutions.

Yes. The next step in stablecoin wars are going to be interest payments. This will radically radically reshape the global currency market.

Tether buys $100M in US Treasuries
Treasuries pay tether 4.5% interest
Tether pays 2% interest to USDT holders and keeps 2.5% for operating income
USDT holder gets 2% interest automatically in wallet in monthly/daily increments

This will destroy most other national currencies.

Hyper-dollarization
Hyper-bitcoinization

26 sats \ 0 replies \ @kepford 22 Mar

Cleanly is the key word.

26 sats \ 1 reply \ @denlillaapan 22 Mar

What undisc said. #745581

28 sats \ 0 replies \ @byzantine OP 22 Mar

the answer to all of the questions on that post is "a private institution which can print its own money and has an exclusive contract with the government to use the money it prints"

21 sats \ 5 replies \ @byzantine OP 22 Mar

and if you're skeptical that the US dollar is not a "federal reserve note" here's a picture front and back

nowhere does it say "US dollar". it is a private note specifically a federal reserve note.

110 sats \ 2 replies \ @022fbc9cef 22 Mar

It literally has United States printed all over it.

0 sats \ 1 reply \ @byzantine OP 22 Mar

https://www.investopedia.com/terms/f/federal-reserve-note.asp

10 sats \ 0 replies \ @022fbc9cef 22 Mar

The U.S. Treasury prints the Federal Reserve notes, which are backed by the U.S. government.

0 sats \ 1 reply \ @ek 20h

nowhere does it say "US dollar"

If that’s your best argument, you just unconvinced me.

0 sats \ 0 replies \ @byzantine OP 19h

14 sats \ 0 replies \ @byzantine OP 22 Mar

https://www.heritage.org/constitution/#!/articles/1/essays/42/coinage-clause

The US is limited in its ability to create money from gold and silver, but private institution, such as the federal reserve can create money back by debt, not gold and silver

United States federal reserve note is a private currency it is not a government backed currency.

It is a private currency accepted by a public government.

7 sats \ 0 replies \ @justin_shocknet 22 Mar

Correct, and taking it even further the US itself is a private corporation, not the original republic... some say this vitiates a number of constitutional amendments and the national debt... people that work in think tanks like Heritage and inform Trump admin policy.

Several other key people in and around the Trump admin have straight up said Fed printing is going to give way to stablecoin minting.

0 sats \ 3 replies \ @kruw 22 Mar

You're wrong, the US dollar is a government currency. The chairman of the Federal Reserve is nominated by the president and confirmed by the senate.

An example of a private currency would be Bitcoin.

7 sats \ 0 replies \ @byzantine OP 22 Mar

as we've recently seen, the president cannot fire the the chairman of the federal reserve. You can nominate them and get confirmed by the Senate, but then is fully on his own as if running a private corporation.

7 sats \ 0 replies \ @byzantine OP 22 Mar

bitcoin is a public money. It's not owned by anyone.

7 sats \ 0 replies \ @byzantine OP 22 Mar

does the federal reserve need to get permission to issue more currency units?

0 sats \ 1 reply \ @LibertasBR 22 Mar

I think the concept you presented of private in relation to the FED is wrong. For the simple fact that if it is not with them and they do not control it and can print as much as they want, it is no longer private property. Tether is based on FED debts. It is a sand castle supported by nothing, since the dollar is backed simply and purely by trust with the American State.

7 sats \ 0 replies \ @byzantine OP 22 Mar

https://www.investopedia.com/articles/investing/081415/understanding-how-federal-reserve-creates-money.asp