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I don’t see why anyone would trust future payments in the dollar. It’s not backed by anything but trust. Sure, you’ll get your social security at $5k/month in 30 years, but the money will be worth toilet paper. Sure, your army pension will be there, the raw $$ amount, also worthless.

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> It’s not backed by anything but trust.

It's backed by the ability of the US government (and military) to ensure that the US is operating. As long as the US maintains a world hegemony, it's a safe bet. If it loses a series of engagements (not a single theater of economic interest), it's time to hop on to another currency. Ofc, that's just how I see it.

Sure, backed by a large army that ensures the fed prints the value of your pension away.

Both pensions and social security scale with the cost of living. inflation isn't new, and this isn't the worst we've seen.

So we printed 40% of total money supply two years ago and this year we gave an 8% social security raise. What a sham. Please let me opt out now.

I give you permission to opt out. If you have skills, there are plenty of countries that would gladly have you.

They all mostly do monetary policy the same way though.

Oh, staying and voting that we can all opt out and keep our money.

That 40% did not lead to a 40% increase to the cost of living like you are implying. Cpi went up 8% in 2022, and social security went up 8.7%

and there is higher chance that ss will bankrupt slightly earlier..

Also, ss obviously is not the largest source of American's well being, and those other sources (wages) will not be keeping up with inflation.

That increase was due to the covid stimulus checks. That isn't the new rate of money supply growth. In fact, the money supply has been decreasing lately. As i understand it (not an expert) the social security surplus (money not yet sent out to recipients) is invested in treasury bonds, so should inflate at the same rate as the dollar.

> That increase was due to the covid stimulus checks

stimulus checks were like few 100B, very different amount, total stimulus program was 2.2T: https://en.wikipedia.org/wiki/CARES_Act , while M1 supply increased from 4T to 20T: https://fred.stlouisfed.org/series/M1SL

I think institutions took advantage of low interest rates, borrowed lots of money, and now will borrow/invest with much higher return for next many years.

> That isn't the new rate of money supply growth

I don't think there was so large scaled increase in the past ever.

I've been working on the M2 money supply. The total stimulus was in the range of 5T. Pre stimulus the M2 was at 15T, and today it is 21T. M1 is not a good metric for tracking the 'printing' of money.

The fact that the system isn’t opt out is evil.

> As long as the US maintains a world hegemony, it's a safe bet

but does US maintain a world hegemony? How does it demonstrate hegemony?

> but does US maintain a world hegemony?

Yes. As of today.

> How does it demonstrate hegemony?

As it has done since ww2. I mean, maybe that's a rhetorical philosophical question. I don't really care to argue about the self-evident history.

> I don't really care to argue about the self-evident.

its totally not self-evident. Even after ww2 world was bi-polar, and now US leadership in economy and tech is much less evident.

To me, it seems there are two sides to your point, one about trust, and the other about dollar value in context to growing federal debt. As for the trust, I think part of where things go beyond trust comes from a sort of self-reinforcing economic strength.

When the average monthly expenses for an American household add up to about $5,500, certain industries (like transportation (16.8 percent of those expenses), or food (12.8 percent) will always view the American economy as a leading market to operate in. At a macro level, it would seem that many businesses making this similar judgement call would create a dynamic that goes beyond trust.

Regarding the buying power of pensions point, I believe there are cost of living adjustment laws for buying power which require Army or Social Security pensions to react to USD's changing buying power over time.

The existence of a rule doesn't mean the thing will happen.

(There's no reason for government policy to eschew abundance, so I'm not particularly worried for the future, but that is because of the dynamics of the situation, not the laws that are in place)

> I don’t see why anyone would trust future payments in the dollar.

the issue is that other currencies can be trusted even less.

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