Pyrrhic Victory

That is a terrible idea, given that the market goes up and down, and not everyone necessarily makes enough money to fully fund a 401k style retirement account. The only winners in that situation are the retirement fund managers, and people at the top of the income distribution who suddenly don't have to pay for the less fortunate.

Much the same argument can be made WRT pensions, which are guaranteed benefit systems. Its the company/govemerments responsibility to assure that the pension is funded sufficiently to grow. Market failure risks, and the like are the responsibility of the pension, which can do a better job of averaging returns over decades than the individual can. Say someone wants to retire in 2008, instead of their 401K dropping by 40% and eating heavily into their principal they are just part of a larger fund which can absorb that hit with the understanding its over funded from the previous 20 years of returns and the fact that it could be additionally funded a small amount over the next couple decades to make up for the loss if to much of the principal is reduced.

Its basically the same argument for any kind of insurance. You spread the risk over a larger pool and everyone benefits.

What is the endgame though?

Can the governments keep adding new debt at the rate they have been adding in the past 12 years?

Can they just keep going into negative rate teritory? For how long?

Will we eventually see -1000% interest rates so that the government/public debt can be maintained?

edit: actually, the government does not need -1000% interest rates to service an infinite amount of debt, it just needs real 0% interest rates and the ability to issue more debt.

No. Government having a monopoly on the issuance of money is a relatively recent development.

> even many centuries ago there were laws that forbade forging the money

That forbade forging/counterfeiting money issued by the government, yes. But not issuing different money altogether.

Historically, government-issued money has not always been available everywhere people wanted money, so other forms of money would be created to fill the gap. It is only in recent history, with the advent of paper (and later electronic) fiat money, which removes all practical limits on how much of it governments can create, that government issued money has become available everywhere to the point where the incentive to create private forms of money to fill a gap is basically gone.

> The way I understand it, the worth of money was seldom, even in old times, the weight of the metal.

The worth of the money was always supposed to be based on the weight of the precious metal, such as gold, that it contained.

However, once you've gotten everybody to believe that, say, all your gold coins contain some standard quantity of gold, which determines their value, the temptation is irresistible, judging by the historical record, to then secretly debase the coins by substituting a much cheaper metal for gold for part of them, so the actual weight of gold in them is less than the standard amount, but still telling everybody that they're the standard gold coins so they will continue to be accepted at the same value, based on the standard weight of gold instead of the debased weight.

Of course, such a secret never actually keeps for very long, and once word gets out that you're debasing your coins, their actual value in the marketplace goes down. Or, to put it another way, prices in terms of your coins go up--it takes more of your coins to buy the same goods and services. This is why monetary debasement always leads to price inflation.

> Otherwise nobody would have cared about the forgeries?

Governments always care about forgeries because they don't like competition in the business of issuing money, since that business is a source of revenue (look up the term "seignorage").

> is there any historical example of money long enough disconnected from the issuers "messing" to be even able to argue there is such thing?

The incentive to debase the money you are issuing, once you've gotten everyone to accept it at a certain value, is certainly not limited to governments. Fractional reserve banking comes from the same incentive: if you've gotten everybody to believe that, say, every gold note your bank issues is backed by a standard quantity of gold in your bank's vault, the temptation is irresistible, judging by the historical record, to then start secretly issuing more notes than you have gold, but still telling everybody that your notes are all 100% backed by gold, so they will continue to be accepted at the same value. Of course this never works for too long either, and since it's easier to print paper notes than to mint debased coins, inflation with debased paper money tends to happen faster and be more of a problem than inflation with debased coins.

So the difference between a private issuer of money and the government issuing money is not that the latter will debase money but the former won't. The difference is that if one private issuer's money gets debased, but there are multiple different private issuers, such as banks, people can simply stop using the money from the bank that debases it. So in a private, competitive situation, there is actually an incentive to not debase your money, which can counteract the incentive I described above towards debasement. In short, there is a limit to how bad things can get if private money issuance is allowed.

But if the government debases the money, while it's also enforcing a monopoly on money issuance (and also, most likely, requiring things like taxes to be paid in the money it issues), there is no other money people can choose, so an entire economy can be ruined.