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Currency Debasement: How Money Dies

⚙️ How Debasement Works

Spend > Tax

Deficits grow

Start

Debt Builds

Interest burden rises

Print to Bridge

QE monetizes deficits

Trust Erodes

Velocity spikes

📜 History Rhymes

Rome Denarius

Silver content debased

Weimar Germany

War debts → hyperinflation

USA 1971

End of gold convertibility

Modern

QE era (2008–)

🛡️ Protect Yourself

Real Assets

Land, commodities

Core

Scarce Digitals

Bitcoin

Productive Assets

Companies

Geographic Diversification

Multiple jurisdictions

🚨 Warning Signs

Deficits explode

>10% of GDP

Late Stage

Interest > defense/health

Crowd out

Capital controls

Limits on flows

Velocity surges

Currency flight

Debasement vs Default

  • Default is politically unacceptable; debasement is hidden default
  • Debt repaid in devalued currency = stealth default
  • Voters blame price gouging, not monetary policy

Why It Accelerates at the End

  • Trust is reflexive: falling trust → higher velocity → higher inflation → lower trust
  • Flight to hard assets and foreign currencies accelerates decline
  • Governments often respond with controls (FX limits, withdrawal caps)

Actions

  • Hold a core of hard/productive assets
  • Keep some assets outside your home jurisdiction
  • Minimize exposure to long-duration fixed income
  • Build skills and businesses with pricing power

Next Steps