Funny you should mention that. Now Germany was trying to pay retribution to the Allies.
The Allies were trying pay back the American banks, especially JP Morgan for the funny money debts incurred in WWI.
Now JP Morgan just about lost its loans to the Allies when it became clear the Allies would lose WWI without American intervention.
Lucky thing the Lusitania went down, huh? I mean its military escort was withdrawn at the last second, and the Germans ads run in American papers to warn US citizens not to get on it were suppressed, and it was ordered to run at 1/4 power in sub infested waters. ....But it wasn't a sure thing.
JP Morgan nearly lost a bundle of fiat.
Remind me why William Jennings Bryan resigned again?
You don't believe that the Weimar Republic overstamped the stamps with 2 and 5 million times their original value? I have these stamps in my collection. They are genuine. You can look them up in any stamp book if you like, I don't ask you to take my word alone, it's easily verified history. I did mention that there may have been a few stamps isssued between the 5 million overstamp and the Third Reich Hitler stamp, I just don't have those.
You do not have the process fully understood if you believe paying down debt causes deflation.
Here is how I understand it from explanations that have been given to me from various sources: Paying down debt causes less money. Less money to pay for goods and services causes lower prices since sellers have to either accept less money for their goods or not sell at all. Lower prices require lower wages in the making of whatever it is being sold since there is less money available from the sale to pay for labor in making it (BTW, I'm in business for myself for most of my adult life and can testify to the truth of this part, the lower wages resulting from lower prices. This isn't debatable and isn't just my opinion, it's just plain old math). Lower prices and less money available is deflation as it has been explained to me. Perhaps those who have explained it this way to me have done so wrongly and I would welcome further clarification by yourself if you wish to go into it. As I said, I'm not an economist and must rely on the explanations of such things by the economists and bankers I know (including one University Professor) that have led me to understand the system in this way. Perhaps they just didn't want to go into detail with someone not in their field or not studying their field ( I can understand that, I feel the same about some subjects of my own expertise. Just too much background lacking to get technical with most people).
No one would argue that paper currency can not be abused but the arguments for metallic backing are without merit if not impossible to implement without immense suffering.
Sorry if my mention of gold caused you to think I was advocating gold backing of our currency. I was just using it as a convenient way to express my understanding of how the money system works, I don't advocate gold backing of money (I don't oppose it either, actually I don't know one way or the other if it would work. everyone seems to say something different according to their own personal theory and claim their own expertise as the authority for their theory being the right one)
As I said, FWIW, and IMO. If you want to go into more detail about something feel free to do so ( I would appreciate any increased understanding of our money system I might aquire), but understand that I'm not an economist or a banker and don't have any pretense of genuine expertise in either field.
BTW, my post was in response to an inquiry asking if I understood that if we pay off the national debt our currency ceases to exist by AdamSelene235 in #31. You might possibly address this issue in relation to both infaltion and deflation, and what our money actually is and where and how it originates; there have seemed to be some misunderstanding and disagreement about this between posters on various threads over the years.