I put up a post on Gab attempting to explain to Boomercons that eliminating student loan debt was not inflationary. I was unsuccessful, on the basis of the 193+ replies.
Eliminating student loan debt is not inflationary. It cannot be inflationary, because in a credit economy, cancelling debt reduces the quantity of credit money in the system.
This is intrinsically deflationary.
So, because I am a kinder, gentler Dark Lord, I decided to helpfully explain to this woefully ignorant souls the nature of credit money and how it relates to the monetary phenomena known as “inflation” and “deflation”.
Dear Gab commenters,
The undeniable fact is that I know considerably more about economics, debt, and credit money than you do. Not only am I an economist by training, but I correctly predicted the 2008 financial crisis and I am the author of the labor mobility refutation of free trade.
Frankly, most of you appear to be functionally retarded where economics are concerned. So, I will type very slowly in order that a few of you might be able to follow along.
Most money is debt and it comes from nowhere. It is not printed by the government, it is literally created from nothing when a loan is taken out. This is inflationary. When a loan is cancelled, forgiven, or written off, the debt literally vanishes. This is deflationary, since it reduces the amount of money in the economy.
If the loan is paid off, either by the debtor or by a third party, then no money leaves or enters the system. It is a neutral action. If interest is paid on the loan, this is mildly inflationary but trivial at current interest rates.
That’s literally how debt money works, and if you don’t understand why L.1 is bigger and more important than the M1 money supply, then please stop sharing your opinion on the subject of student loans because you have absolutely no idea what you’re talking about.