21–30 of 94 posts
Where are these interest payments going to? Who profits off the US being perpetually in debt?
(edit: more recent link)
It's an interesting point and something that we should talk about. But the article doesn't really make the case that this is a waste of money. If it was advantageous to take on the debt in the first place, it might also be worthwhile to keep the debt on the books now. Presumably there is an interest rate at which it will stop being worth servicing the debt, but I don't really know where that point is.
To wit, US assets value in something like the 240 trillion dollar range, though I’m sure you could find wide variance to such measurements given the complexity of the US asset holdings.
And it breaks my heart that both parties are to blame.
This could be a massive problem if the debt was denominated in a currency other than US dollars (which the US Government controls the monopoly currency issuer for). But since all of the US's debt is in US dollars, and they're not constrained by artificial limitations like commodity convertibility or fixed exchange rates, it's just an interesting fact that doesn't actually really matter much.
The real killers are excessive private sector debt, and even worse, debt denominated in a foreign currency.
It's an interesting point and something that we should talk about. But the article doesn't really make the case that this is a waste of money. If it was advantageous to take on the debt in the first place, it might also be worthwhile to keep the debt on the books now. Presumably there is an interest rate at which it will stop being worth servicing the debt, but I don't really know where that point is.
well the game will continue until you cant service your debt payments anymore. Then you default. Crisis, pain, recession. Rinse then repeat. https://en.wikipedia.org/wiki/List_of_sovereign_debt_crises
1. All money is debt insofar as it only represent goods as services yet to be rendered, an I Owe You as it were
2. If an entity is able to continue borrowing (more and more) money it represents a willingness of lenders to lend, which is a direct representation of their faith in that entities ability to service the debt
3. Whether a nation-state should balance it's budget is more a philosophical question coloured be ideology rather than a pragmatic concern.
4. If you believe the good times are going to keep rolling, and any bad times will, on average, pass relatively swiftly (people do have a tendency to persevere), then not borrowing money results in a lost opportunity cost.
I'm sure someone can respond with some equally convincing reasons as to why nation-states shouldn't run a deficit.
Go!
What happens if the US inflates away the national debt?
I think the biggest thing to keep in mind is that the Federal Government of a monetarily sovereign nation (like the US, UK, Japan, Australia, etc.) plays by different rules to a household or business. This could be a massive problem if the debt was denominated in a currency other than US dollars (which the US Government controls the monopoly currency issuer for). But since all of the US's debt is in US dollars, and t…
Where are these interest payments going to? Who profits off the US being perpetually in debt?
The treasury has a one-page breakdown of the kinds of debt. https://www.treasurydirect.gov/govt/reports/pd/mspd/2018/opd... It's not a deep dive but I thought it was a great overview for fitting on one page. (edit: more recent link)