Comment by AngryData
3 days ago
On the short term every economy is effectively zero sum. Even if you invented something magical that is worth trillions, the economy can't pull trillions of dollars out of nowhere in any short period of time without devaluing everything else.
Sigh. A brief explanation of how money is created. If I create something of value, you can go to a bank and borrow money based on that value. Where did that borrowed money come from? The bank created it out of thin air! Yes, that's right. Created value can be transformed into money. The books balance. And this is unlimited.
What happens when you pay back the money? Yes, it is symmetric, the money is destroyed! (wild, isn't it!)
So why does the bank do this? They make money on the interest from the loan.
This is how "free banking" works, and it applies to your scenario. Creating value does not devalue the rest of the economy. The supply of money is not fixed, it rises and falls relative to the value in the economy.
I know this is a difficult thing to describe briefly, there are college degrees on this topic.