Helicopter money is coming to Hong Kong. Every permanent resident above the age of 18 will get $10,000 HDK which is worth around $1,300 USD. The announcement came on on Wednesday from Paul Chan, Hong Kong’s financial secretary report Hong Kong Free Press. The relief measure aims to boost the consumption and relieve the economy considering the deficit
The overall amount to be given to residents is estimated to be $71 billion. This is the first deficit that hits the Hong Kong Economy in the last 15 years. Hong Kong economy had a negative growth rate in the second half of the past year caused by the US-China trade war and massive protests all over the country.
Paul Chan said that financial reserves which are larger than $1.1 trillion HDK are sufficient to cover the handover costs.
“I consider that, with ample fiscal reserves, the government has to increase public expenditure amid an economic downturn to stimulate the economy and ride of the difficult times with members of the public,”
Chan also announced many tax reliefs for individuals and businesses in the meeting for the fourth budget on Wednesday saying:
“In preparing this budget, I put the focus on ‘supporting enterprises, safeguarding jobs, stimulating the economy and relieving people’s burden,’
Hong Kong is in lockdown because of the coronavirus. The country faced massive social unrest before the forced lockdown. Now the economy is paralyzed, supply chains have failed and there are no goods or services despite the high demand. The government decided to give away free money. We can imagine what happens with the prices after that.
Governments and bankers are trying to find solutions to heal the economy but the biggest problem is the monetary system they have created but it seems that they have painted themself in the corner. Whatever they do it causes more problems than it resolves. Distributing free paper money to all the people might help in the short term but you can not do that without creating inflation and raising the prices.
Bankers and governments are taking extreme measures. In Hong Kong, we reported in November how HSBC closed the bank account belonging to the protesters’ movement. In Europe, banks are imposing negative rates. In Lebanon Bank are placing crazy restrictions on people’s deposits. The last one we reported is that Banks in Lebanon Only Allow Withdrawals In Pound with Exchange Rates 40% Less than Rates in the Free Market
This week on Monday, we have seen also a surge in the gold price because of concerns for economic stability in light of coronavirus spread around the globe.
Fiat money is becoming more worthless every day and it is only a matter of time until more people realize the potential of bitcoin, the fair money.