... they WON'T.
If there is a complete collapse of the modern economic system then there is nothing you or I or anyone else can do (as an individual) to come out "okay" on the other side.
My thinking on this is that since there is no way of protecting yourself in this scenario then there is no purpose to even attempt to do so. I also regard a complete failure of this nature, as being extremely improbable. If an asteroid lands smack dab in New York City and destroys the whole city then there is no insurance company anywhere that is big enough to have enough assets to pay for such a repair job. (The Americans have had trouble enough with New Orleans, but I digress.) Barring such a catastrophe (in which we all have much, much bigger things to worry about than how much money we have) I think modern society will do everything in its power to prevent a financial collapse of its own accord. That doesn't mean they won't do things that are not pretty ...
If the US gets to the point of "printing money" - basically, wiping debt off the books without really collecting the taxes to pay for it in the interest of protecting bond-holders - then yes, that's traditionally regarded as inflationary, and yes, it means that debts and assets denominated in US dollars will be worth less in terms of US currency. The way to protect against that, is to own things denominated in currency that is less likely to be affected by this. (I regard Canadian dollars as not a bad choice. Swiss francs are another.)
I agree that the US is not near the point of diminishing returns with regards to raising taxes to raise revenue, but it's a politically unpalatable thing to do. It's also worth noting that a consumption tax (variously referred to as HST or VAT or whatever) is less destructive to an economy than income taxes. Much as the GST/HST is hated by the general public, it's better than income tax (of course, we pay both, but that's another matter).
What the US needs is to implement a consumption tax, reform the income tax system, implement a "carbon tax" (they need to drastically reduce energy consumption - if for no other reason than to reduce the amount of money they send to overseas markets to pay for it), fix their broken health care system, remove mortgage interest deductibility, remove a whole raft of government subsidies, and get out of fighting other people's wars. None of these are popular - but it's got to get done. I'm not holding my breath. But, either they do this voluntarily and have the choice of doing these things in a manner in which they have a choice of HOW to do them, or they are forced into austerity measures and are forced to do them.
It's been said that the US government can be relied upon to always make the right choice - after exhausting every other possibility first ...
If there is a complete collapse of the modern economic system then there is nothing you or I or anyone else can do (as an individual) to come out "okay" on the other side.
My thinking on this is that since there is no way of protecting yourself in this scenario then there is no purpose to even attempt to do so. I also regard a complete failure of this nature, as being extremely improbable. If an asteroid lands smack dab in New York City and destroys the whole city then there is no insurance company anywhere that is big enough to have enough assets to pay for such a repair job. (The Americans have had trouble enough with New Orleans, but I digress.) Barring such a catastrophe (in which we all have much, much bigger things to worry about than how much money we have) I think modern society will do everything in its power to prevent a financial collapse of its own accord. That doesn't mean they won't do things that are not pretty ...
If the US gets to the point of "printing money" - basically, wiping debt off the books without really collecting the taxes to pay for it in the interest of protecting bond-holders - then yes, that's traditionally regarded as inflationary, and yes, it means that debts and assets denominated in US dollars will be worth less in terms of US currency. The way to protect against that, is to own things denominated in currency that is less likely to be affected by this. (I regard Canadian dollars as not a bad choice. Swiss francs are another.)
I agree that the US is not near the point of diminishing returns with regards to raising taxes to raise revenue, but it's a politically unpalatable thing to do. It's also worth noting that a consumption tax (variously referred to as HST or VAT or whatever) is less destructive to an economy than income taxes. Much as the GST/HST is hated by the general public, it's better than income tax (of course, we pay both, but that's another matter).
What the US needs is to implement a consumption tax, reform the income tax system, implement a "carbon tax" (they need to drastically reduce energy consumption - if for no other reason than to reduce the amount of money they send to overseas markets to pay for it), fix their broken health care system, remove mortgage interest deductibility, remove a whole raft of government subsidies, and get out of fighting other people's wars. None of these are popular - but it's got to get done. I'm not holding my breath. But, either they do this voluntarily and have the choice of doing these things in a manner in which they have a choice of HOW to do them, or they are forced into austerity measures and are forced to do them.
It's been said that the US government can be relied upon to always make the right choice - after exhausting every other possibility first ...
