Author: PlanktonPunkt

Apparently, our government had at least 14 of them, 11 in Department of Treasury, Department of Health and Social Services, Department of State and Department of Defense had their own magic money computers too. A Magic Money Computer, according to Elon Musk is a machine that creates money out of nothing by just issuing payments.

The original Magic Money Computer, Sampo, being stolen from Pohjola by Kalevala raiding party. Sampo of the legend was a magic mill that produced flour, salt and money. (art by Akseli Gallen-Kallela, image sourced from Artvee)

There has been speculation that such Magic Money Computers would allow fraudulent or erroneous invoices (such as double billing) to be paid regardless of available government funds. However, the truth of the bottomless money pit is probably more about standard prosaic grift – based on the parade of DOGE news, the US Government seems to be full of weird offices where the Directors pay to themselves and their “workers” outrageous salaries and lavish other perks (luxury apartments, luxury offices) and then top it up by (relatively) small embezzlements like expensing their everyday (luxurious) life.

These money sinks are supplemented by a class of government parasites, ‘NGOs’ (Non-Governmental Organizations, which actually are mostly or fully dependent on government money). ‘NGOs’ (not to be confused with true charities) siphon money from government coffers and can act as money laundromats by donating heftily to nice politicians and PACs and by hiring politicians or their family members with attractive perks and reimbursement packages.

After hearing more and more about all the ‘NGO’ grift, I felt slightly like a chump for not having founded a ‘charity’ dedicated to “Physical and emotional well-being of an individual” (namely myself),  with the governing board and financial regulators consisting of Me, Myself and I and set up a reasonable monthly stipend of, say $7497.68 including taxes and fees, though for that, I would have needed much better political connections within the bureaucracy (not to mention far more flexible morals).

Joking aside, Magic Money Computers are a problem because they are not synchronized, i.e., there was some variation between their bookkeeping, estimated to be about 5 – 10%, which can lead to unregulated increase in nation’s money supply. Which is presumably on top of the official increase by the approved deficit spending.

Officially, the US government does not print money. What happens is that the government issues treasuries which the big banks (primary buyers) buy to sell forward, or to Fed, which buys treasuries from the public by injecting money into the accounts of the selling banks, i.e., creating more money. Banks, of course, use their new capital as a security for issuing new loans via fractional reserve banking, multiplying the money printing effect.

With Magic Money Computers potentially adding to the money supply, we are essentially talking about unsupervised inflation. In theory, as long as the increase in production (of goods) increases with the money supply, the prices remain steady. If the production of goods increases relative to demand at a greater rate than money supply, resulting oversupply causes price deflation, but if the money supply increases faster than production while demand remains steady or increases, this results either in price inflation or, in case of price controls, product shortages.

I suspect that the US economy has been running an experiment where it has artificially inflated money supply (by deficit spending) while increasing demand (by paying people to consume and by importing more people) in hopes that the production would increase due to increasing demand (look at all these new workers.) What was conveniently forgotten was the regulatory jungle stifling any private enterprise while the masses of new capital were scooped by the well-connected who used it to monopolize resources needed for private enterprises, either by buying the resources themselves, the legislation regulating how the resources can be used, or the bureaucrats who determine who can use the resources (and how), namely those who are insiders.

I would further speculate that as an increasing fraction of government money goes to the politicians, bureaucrats and their family and proteges (and paying patrons like megacorporations and transnational NGOs), an increasing fraction of resources, public and private tends to get concentrated to the hands of politically connected oligarchy. Not only does the increased regulation and fewer resources mean fewer small businesses and anemic economy, with political class acting as oligarchy the national ‘free’ enterprise begins to converge towards a top-down command economy. Command economies are very fragile and prone to collapse for multiple reasons that would be a whole another post.

Let me finish by saying that The United States has been for many years unofficially converging towards the Soviet Model, namely the centralized command economy, and while I have been observing faint signals since the previous decade, now the results are visible in our shops to everyone.

Take for example, eggs. The number of laying hens has gone down due to cullings, whereas the number of mouths has increased due to immigration. Unlike the mythical Sampo that produced also edible goods, the US government has only increased the amount of money in circulation, leading to price inflation and egg shortages. Magic Money Computers are not helping.

An old photo from January 2025. Tonight, I saw lots of eggs in a supermarket.