Ray Dalio

Currency, short-term deposits that you can assuredly and quickly turn into money.

You know, that's what money is.

And the central bank really controls the money.

And then you could look at who has that increasingly, like you could look at M0, M1, and you could see money market accounts, and you could see those very liquid, you know, money, safe money, treasury bills, those kinds of things.

Right.

And so that, but ultimately it's the central bank cuz they control the supply demand.

Well, it faces the trade off, right?

The trade off is like in, let's say COVID.

Right.

Or 1971, when there's too many claims and so on.

The trade-off is that people need money.

they may need money to pay debt and they may need money for whatever reasons and so they are tempted therefore to create money and so you see the coordination between fiscal policy and monetary policy so you saw two big waves of large budget deficits and large supports of central banks

first under Trump when the COVID began, and then under Biden when they got in, because he also wanted more universal basic income.

In both of those cases, the government sent out lots of checks

And that's also a popular thing to do.

Discipline, financial discipline is not what the population typically likes.

Send out those checks, but where does the money come from?

And then the central bank cooperates by buying the government bonds and print money and then buying those bonds.

So when they're in the middle, austerity is not an easy thing to have, right?

Well, digital currency is, right, you're talking about central bank digital currencies.