There is no better alternative for society than debt free currency

I must tell you that because you did not use a spell checker or grammar scan it has been extremely difficult to interpret your thought processes and especially since you use a syntactical style that is, as best that I can determine, shorthand for what you are thinking. For example:"This is true. But replacing the current currency with debt free currency will, as described..." As described? Where? By whom? Anyway. Under your...item #1) These assertions (..create much more inflation....even hyperinflation and economic collapse) are wrong on their face. You have not stipulated the conditions under which your conclusions obtain. The Treasury could do the following and not create inflationary expectations, hyperinflation or economic collapse: For example, the U.S. owes the rest of the world $20 trillion held in bonds and other debt instruments. The Government decides to liquidate this federal debt by printing $20 trillion in debt free currency. That cash monetizes the debt. The Treasury then takes the 20 trillion in interest bearing instruments and liquidates them. Where's the inflation? There is none. (Moreover, I do not agree with any of your unsupported assertions, conclusions.) Current policy allows the Fed to reissue these debt instruments even after monetization, ergo, inflation. Now creditors have the $20 trillion in cash and Treasury and the Fed can reissue the $20 trillion in debt instruments. You state, "But the argument is not that debt free currency is better than the system used before the civil war, the discussion is if it's the bets *possible* system. And it clearly is not, as the current system we use now, of fiat money, is superior to debt free currency." You make this assertion as if it were obvious on its face. It is not. Above is an example of why it is not. Here are more reasons why debt free currency is far superior to the current system of interest money: If the current system is better, then some one needs to explain to Americans why it does not resolve the following: -- insurmountable debt? -- severe fiscal constraint in the provision of public services and programs? -- rampant unemployment? -- billions of dollars in resources sitting idle and/or going bankrupt because private banks won't lend? Issuing debt free currency instantly resolves all of these issues, especially the liquidity issue within our State and local governments, without adding to national or State and local government debt or deficits. The lack of liquidity was the environment in which Lincoln's debt free Greenbacks rescued the Union. Why do we not see the same happening with debt-money during our extreme lack of liquidity where interbank interest rates are near zero and where commercial rates are extremely favorable? Again, debt free currency can be issued without affecting the rate of inflation. You have ignored a number of critical variables in calculating the impact of debt free money on the supply of money. Namely, whether there are idle resources in the economy, whether the economy is deflating, etc. You state, concerning my example of Japan's situation after the war, "But I fail to see how it is even relevant to the discussion." It's relevancy is that international private banks are a major source of financial instability for governments the world over. They finance speculators who use margins to carry out their attacks on a nations currency. What the banks fear is that debt money will be replaced with debt free money and they loose the profitable business of lending massive amounts of money to speculators. The potential of that loss drives banks to constrain the "offending" government. (Stephen Zarlenga, The Lost Science of Money), p. 500-600. You said, "You think that just because there is no debt, the state can simply print money to pay for whatever the state wants to pay for." I presented an argument not what I believe. Nonetheless, it is true, the state can print money for whatever it wants. Japan has done it. Russia and China do it. The isle of Guernsey does it. The State of N. Dakota creates its funding requirements through its State Bank. A system that all States should adopt, especially those in the grip of insolvency. You raise the issue of Zimbabwe's hyperinflation. Let's review the history, in brief: Zimbabwe is a dramatic contemporary example of runaway inflation. The crisis dated back to 2001, when Zimbabwe defaulted on its loans and the IMF refused to make the usual accommodations, including refinancing and loan forgiveness. Apparently, the IMF's intention was to punish the country for political policies of which it disapproved, including land reform measures that involved reclaiming the lands of wealthy landowners. Zimbabwe's credit was ruined and it could not get loans elsewhere, so the government resorted to issuing its own national currency and using the money to buy U.S. dollars on the foreign-exchange market. These dollars were then used to pay the IMF and regain the country's credit rating. Hyperinflation was caused by speculators who manipulated the foreign-exchange market, charging exorbitant rates for U.S. dollars, causing a drastic devaluation of Zimbabwe's currency. The government's real mistake, however, may have been in playing the IMF's game at all. Rather than using its national currency to buy foreign fiat money to pay foreign lenders, it could have followed the lead of Abraham Lincoln and the American colonists and issued its own currency to pay for the production of goods and services for its own people. Inflation would then have been avoided, because supply would have kept up with demand; and the currency would have served the local economy rather than being siphoned off by speculators. (Stephen Zarlenga, "The Lost Science of Money", pp. 579-583.) An accurate explanation of how inflation and hyperinflation obtained is that it begins with a credit crises not the profligate printing of money. The last sentence of your response is a gross misrepresentation of the argument I present. No where do I imply that a "free lunch" is in the offing. There are always administrative costs. Other than that there are no real economic or financial costs to the public sector, citizens who benefit from the allocation of debt free currency, or even private sector banks who serve as depositories for holders of debt free funds. Additionally, debt free currency would serve as a major solution in the development of Third World nations. Debt free currency on a global basis would relieve developing countries of annual debt repayments, these severely indebted countries could use the funds for investments that in Africa alone would save the lives of millions of children and provided 90 million girls and women with access to basic education. If the money is owed to commercial banks, it was created with accounting entries. Third World debt represents a liability on the banks' books only because the rules of banking say their books must be balanced. To change this banks must be allowed to hold reduced levels of assets equivalent to the Third World Debt bonds they cancel. Alternatively, cancel the debt bonds, yet permit banks to retain them for purposes of accountancy. Third World debt could be eliminated with the click of a mouse. Then these governments could create their own currency, interest free, rather than having to borrow dollars to buy currency from private banks.