EXPLAINED: What It Means To “Monetize The Debt”
Favicon 
100percentfedup.com

EXPLAINED: What It Means To “Monetize The Debt”

I’m sure you’ve heard this phrase before:  “If you have a question go ahead and ask it because chances are other people have that question too.” Ever had someone tell you that? Probably a teacher if I had to guess? It’s a principle I try to live out whenever I can.  I have no interest in trying to look like the smartest person in the room.  I have an interest in finding and exposing truth. And if I have to take the risk of asking a “dumb question” along the way to get there, I’m willing to do it. I’m not even saying this is a dumb question (I don’t think it is), but I wanted to address this because for the past 5 or 6 years, I’ve heard people talk about how the US debt is out of control and basically the only option left on the table is to “monetize the debt”. Have you heard that? I’ve heard it a lot, but no more so than recently in President Trump’s second term especially from guys like Treasury Secretary Scott Bessent. This is the clearest way to see what’s happening.They’ve decided to monetize the debt.In the messiest way possible.By printing $150B+ for insolvent banks.To cover an orgy of bank runs.The dollar supply is now going vertical.And so is the demand for Bitcoin.#bitsignal pic.twitter.com/KP27dS8f9r — Balaji (@balajis) March 18, 2023 Bessent: “We are going to grow the GDP faster than the debt growth and that will stabilize the debt-to-GDP, which … is the most important number.” pic.twitter.com/eTdpGDK5LW — Election Wizard (@ElectionWiz) May 18, 2025 Ok, but still it’s kind of a strange and opaque concept. What does “monetize the debt” actually mean? Explain it to me like I’m a 5th grader! Happy to oblige…. What Does It Mean to Monetize the Debt? In simple terms, monetizing the debt happens when a government or central bank creates new money to pay off its debts. Instead of raising taxes or borrowing more, the central bank (like the Federal Reserve in the U.S.) prints money (or creates it digitally) and uses it to buy government bonds or cover deficits. This increases the money supply in the economy. Think of it like a household maxing out a credit card and then magically creating cash to pay it off. The catch? This new money can lead to inflation, as more dollars chase the same goods and services. Make sense? It’s a nice little trick if you can do it! The only thing you need is control over the currency and a money printer! Two things you and I don’t have. But if we know that’s what they’re going to do, then the next question becomes who wins and who loses in that situation, and how can you and I best position ourselves to (A) not lose and (B) profit from it? Glad you asked again! Who Wins and Who Loses? Winners: Governments:They can pay off debts without raising taxes or cutting spending, which is politically easier. Debtors:People or companies with fixed-rate debts (like mortgages) benefit because inflation reduces the real value of what they owe. Asset Owners:Those holding assets like real estate, stocks, or commodities (e.g., gold) often see their values rise with inflation. Exporters:A weaker currency (from inflation) makes exports cheaper, benefiting companies that sell goods abroad. Losers: Savers:People with cash in savings accounts lose purchasing power as inflation erodes the value of their money. Fixed-Income Earners:Retirees or workers with fixed salaries struggle as prices rise faster than their income. Bondholders:Holders of long-term government or corporate bonds lose because inflation reduces the real value of future payments. Consumers:Everyday people face higher prices for goods and services, squeezing budgets. What Might You Want to Buy to Position and Profit? To position yourself and potentially profit in an environment where debt monetization leads to inflation, consider these investments.(Note: Always consult a financial advisor, as investments carry risks.) Gold and Precious MetalsWhy? Gold holds value during inflation and currency devaluation.How? Buy physical gold (coins, bars) or gold ETFs like SPDR Gold Shares (GLD). Real EstateWhy? Property values often rise with inflation, and rental income can keep pace with rising prices.How? Invest in real estate directly or through Real Estate Investment Trusts (REITs) like Vanguard Real Estate ETF (VNQ). Stocks (Inflation-Resistant Sectors)Why? Companies in sectors like energy, commodities, or consumer staples can pass on higher costs to consumers.How? Buy stocks or ETFs in these sectors, e.g., Energy Select Sector SPDR Fund (XLE) or consumer staples ETFs. CommoditiesWhy? Prices of raw materials (oil, agriculture, metals) often rise with inflation.How? Invest in commodity ETFs like Invesco DB Commodity Index Tracking Fund (DBC). Treasury Inflation-Protected Securities (TIPS)Why? These U.S. government bonds adjust their principal based on inflation, protecting your investment.How? Buy TIPS directly through TreasuryDirect or via ETFs like iShares TIPS Bond ETF (TIP). Cryptocurrencies (Speculative)Why? Some view Bitcoin or other cryptos as a hedge against currency devaluation, though they’re volatile.How? Invest cautiously through platforms like Coinbase or Binance, or buy Bitcoin ETFs if available. I love real estate but it’s kind of hard to get started.  Lots of barriers to entry.  Hard to do in small chunks. But I highlighted on the list above two things I’ve been telling you about for 5+ years now. God’s Money (Gold and Silver). Cryptocurrency/Digital Assets (Bitcoin, XPR). If you want help getting started or growing with either of those categories, here are my two recommendations…. First, for Gold and Silver: The ONLY Two Gold Companies I Proudly Partner With And then Crypto the SAFE and easy way: FINALLY! Safe, Secure, Insured, Regulated Crypto…Here’s Exactly What You Need To Do Hope this helps! Share!