The United States is experiencing that right now … although its public isn’t being told that. The US Government “borrows from itself” about $2.5 million USD per minute, and it uses that money to pay for things. (Namely, “war.”) This has led to “artfully concealed and officially denied inflation.”
Anytime the supply and production of “currency” does not correspond to underlying economic activity, inflation is the result.
The US is told that “one percent” of the country controls “most” of the money, and maybe they do. But, by definition, they are no more than one percent of “the human economy.” They might be sitting on bank-accounts with “very large floating-point numbers” in them, but they don’t control or cause a corresponding flow in the production(!), distribution, and selling of goods. Hence, their “stupendous wealth” is specious. Too good to be true.
For many decades, the US was happy to trade with China, since, until last week, China’s currency was not in the “world reserve currency” basket. In order to buy and sell with China, you had to buy Dollars, Yen, Pounds, or Euros first. Usually it was Dollars, such that China currently holds massive amounts of “Dollar debt” that it basically can’t get rid of, no matter how much American real estate it can manage to buy. (The Chinese government also found it necessary to “peg” their currency to … “the Dollar.” Presumably to make the best of a decidedly one-sided situation in which they found themselves stuck … (“rather absurdly,” if I may say) … on “the ‘other’ side.”)
Well, “the IMF has spoken,” and, because of it, the IMF Headquarters may soon be moving to Beijing.
October next, the Chinese Yuan joins the basket and China can simply require to be paid in its own currency, and they surely will. (The effect will be felt much sooner, since international contracts are often made several years in advance, secured by “currency futures.”) Furthermore, they can finally get rid of those Dollars. It will soon be a very different world at Wal-Mart. But, a whole lot more fair.
This is certainly a direct response to the US’s habit of “printing its own money” promiscuously. The US liked to trade with China because there was nothing China could do about it. “Now, they can: what goes around, comes around.”
In a very real sense, what America was officially(!) doing amounted in-effect to a mash-up of counterfeiting and swindling. It was legal. But it was not fair.