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Cake day: February 20th, 2025

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  • turnip@sh.itjust.workstoA Boring Dystopia@lemmy.worldFucking leeches
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    3 hours ago

    Its definitely not capitalism. Our system survives by creating economic slaves, for instance the mortgage acts as a gatekeeper in the fiat system, by locking up economic value and an inelastic good in a form that can only be unlocked by completing the payment obligations.  Housing rises in price to max out the metaphorical bucket of whatever interest rates allow for debt accumulation, and property ownership is controlled by one’s ability to secure debt. This ensures that the financial system has a steady stream of obligations that help sustain the flow of currency, which helps drive aggregate demand.

    The goal is to create a 2% inflation, as calculated by an index that excludes housing appreciation and investments, you require ever growing money supply.  Money supply is grown via debt accumulation, this then funnels down into foods and services, excluding substitutions and hedonic adjustments, reversing technological deflation, deriving a 2% inflation to a dynamic basket of goods. Housing works well for this because housing is finite and demand in inelastic; prices can rise faster than fundamentals, and it is therefore a liquidity sponge that is a necessary liability to take.