Mirror Mirror On The Wall

Money as the Trade facilitator.
In Monetary economic, goverment issued money as a sovereign-debt instrument with zero maturity.This ruled is valid only for specie money, which is a debt certificate that entitles the holder to claim on demand a prescribed amount of gold or other specie of value. Governmentissued fiat money, on the other hand, is not a sovereign-debt but a sovereign-credit instrument, backed by government acceptance of it for payment of taxes.

It's then called as State Theory of Money or Chartalism. USD is a fiat currency and the USD hollder could exchanges it for another dollar at their Reserve Bank at tha same value as it haves.
Sovereign bonds are sovereign debts denominated in money. Sovereign bonds denominated in fiat money never be default since sovereign government can print fiat money at will.
When fiat money buys bonds, the transaction represents credit canceling debt.The relationship is rather straightforward, but of fundamental importance.I dont want talk about dollar hagemoni for that matter you should take free course from Nouriel Roubin from Stern NYU, he is italiano americano , blue jeans but no cassino.

Debt - Credit and Mirror
Mirror, mirror on the wall, who is the fairest of them all?
Did you still remember the story of the Witch and her mirror? She asking the mirror who is the beautifull women of the Earth and the mirror showing her that there was other woman that most beautiful than her. She was very anger and try to destroyed her..etc, i'm not story tellers :-)

Economy is drived by Credit not debt or could be said Debt is the mirror reflection of credit.
Mirror does violence to the symmetry of its reflection.
A mirror does not turn an image right to left or not upside down as the lens of a camera does.
=> a mirror image transforms front to back not left to right as we commonly assuming.
Yet we often accept this aberrant mirror distortion as uncolored truth and we unthinkingly consider the distorted reflection in the mirror as a perfect representation.
Mirror, mirror on the wall, who is the fairest of them all? The answer is "your backside." :-)

Till this point Natasya still the beautiful girls of the worlds, but alas in the language of monetary economics, credit and debt are opposites but not identical. In fact, credit and debt operate in reverse relations. Credit requires a positive net worth and debt does not. One can have good credit and no debt. High debt lowers credit rating. When one understands credit, one understands the main force behind the modern finance economy, which is driven by credit and stalled by debt. Behaviorally, debt distorts marginal utility kalculations and rearranges disposable income. Debt turns corporate shares into Giffen goods, demand for which increases when their prices go up, and creates what the americans medicineman - Alan Greenspan calls "irrational exuberance", the economic man gone mad.

Good night and sleep tight with Natasya Kinski not her dracula father :-)

Economics Politics