>>"Now I want to correct somebody who seems to think that money now on a variant of the "gold standard", when it isn't."
I said no such thing, nor implied it. Correcting someone who says that the UK, USA and Europe have "no asset base", doesn't mean anything other than that I'm pointing out you're wrong. I know what you're trying to imply - that I say because these countries have assets to back their wealth that I'm saying they're like the Gold Standard. But I didn't say anything remotely like that and the fact that you think the one implies the other shows your own misunderstanding of what Fiat and non-Fiat currencies are. Just because a currency is a Fiat currency, doesn't mean there isn't anything backing it, it means it has no intrinsic value. Whereas gold sovereigns or similar obviously do.
>>"Net (after all money-in-bank) UK national debt is over £1,254,000,000,000 Does the UK government really have that much in physical assets?"
Did you just try and shift your position from the USA, UK, Europe "have no asset base" to 'we don't know how much precisely the asset base is so lets ignore it' and think no-one would notice? Have the decency to admit you were talking absolute shit. As to whether £1.25trn is more or less than the sum saleable value of Britain's state assets AND future taxable income, the question pretty much answers itself when you phrase it out properly. But just for you, the UK's GDP is £2.38trn. So unless you think that the UK is making nearly double its total worth annually (I wish I could buy something that would make me double what it was worth each year in perpetuity), then the answer even ignoring future taxable income is a resounding "yes". Really, your grasp of relative figures is perhaps the only thing shakier than your grasp of the underlying principles.
And if you dislike my tone, it's because you obviously no very little about this subject and should therefore have the decency not to try and sound like an expert.
>>It doesn't matter because we can keep servicing the debt and inflation means the real cost of the debt goes down over time.
In the immortal words of Lt. Ripley: "Did IQ's drop sharply while I was away?" I already said that inflation is bad because it devalues savings and is a critical disincentive to investment. Governments hate high inflation. Read some basic economics text books, for our sake if not your own.
>>"Foreclosing loses money, that's why they try to avoid it if possible. I pay my mortgage because I don't care if the bank loses money, I don't want to lose my house!"
No relation to the point I made whatsoever which was that if as you wrote banks have no asset base, what do you think your mortgage payments are? Every time you pay your mortgage, you prove your own words above wrong. Again, stop trying to shift the argument wildly and have the decency to admit you wrote something fundamentally and obviously wrong.
>>Banks don't have the assets to repay all their liabilities - they bet the company on no more than a small number of loans going bad. In 2008/9 a few of them lost that bet.
They have the assets. They're legally required to. What they don't have is the liquidity to repay them all at once. Again, you don't understand the basic terminology you are using. You're way out of your depth and still trying to talk authoritatively. I would enjoy enormously seeing you stand up in front of a room of second year Economics undergraduates and deliver your original post to them. Additionally, your understanding of the Sub-prime crisis and the events that followed are another titanic misunderstanding of what actually happened. The crisis wasn't precipitated by banks lending out more than they had. It was precipitated by them lending to people they shouldn't, those people defaulting and house prices collapsing, and then not being able to make enough money to pay their own debts. They borrowed money to lend out and then couldn't pay it back (massively simplified), which is a very different scenario to lending out money which doesn't exist (what you say was the issue when you state that they were lending out with no asset base).
>>"On a small scale, inflation means my mortgage payments get more affordable as time goes by."
Really? Got fixed interest rates in perpetuity do you? Think the banks can't calculate their own APRs? Hate to break this to you, but interest rates get adjusted to account for inflation. Your mortgage repayments get more affordable over time because you're reducing your principle (the amount you owe), not because of lovely inflation. The latter is compensated for by adjustable interest rates.
"The difference between Bitcoin and GBP is that there are hundreds of millions of people who are confident that GBP will still be valuable in 25 years time."
No, the difference is the reason why people are (semi-)confident in the British pound's long term value over Bitcoins, and that's for real differences between the currencies. As already explained, the pound is a national currency and required by law for paying taxes, is used as the denomination for government bonds, etc. BitCoin has none of these. It's not just that one achieved some critical mass and this is the sole distinction between the two. Additionally, there are other major differences, such as the pound being a fiat currency and inflationary, and Bitcoin (despite having no intrinsic worth) works as a non-fiat currency in many ways and is non-inflationary. But feel free to dismiss that which you find complicated. (Again).
>>"Real currencies have gone down the toilet more than once, with hyper-inflation wiping out everything (Germany, Peru etc). A new currency was then created - the government and country still existed, but the old currency became worthless."
Funny how earlier you were arguing how inflation wipes out debt. In neither of these cases did that actually happen. The debt was foreign-owned. The Weimar Republic (Germany) collapsed in large part because of foreign debt (war repatriations) and the hyper-inflation did nothing to help them. Learnt anything from all these corrections? Or are you just going to try and sound even more authoritative next time around and try to again avoid admitting obvious errors on your part such as the USA, UK and Europe "having no asset base".