U.S. Is World’s Most Competitive Economy for First Time in a Decade • Hacker News Board

Re: U.S. Is World’s Most Competitive Economy for First Time in a Decade

#121

Post by spiralx » Thu, Oct 18, 2018, 9:28 AM UTC

diggernet wrote: post #120

spiralx wrote: post #116

Earlier quoted context omitted.

If creditors are paid off, why would that discourage them from making future loans? Creditors surely want to get their money back, and countries that have trouble borrowing money are those that don't make debt repayments, not those that do.

Because printing more dollars reduces the value of each one, so they've been paid back with dollars worth less than the ones they loaned out.

But even if that's true - does printing more dollars affect the price of crude oil on the international markets for instance - if the interest accrued on those loans exceeds the loss of value due to inflation, then they're still ahead overall. And that's the sort of thing that people take into account already when making investments.

And that's not considering that the same would happen with any alternative investments, nor the fact that risk is an important part of an investment calculation, and US debt is considered "risk-free".

Re: U.S. Is World’s Most Competitive Economy for First Time in a Decade

#122

Post by diggernet » Thu, Oct 18, 2018, 6:06 PM UTC

spiralx wrote: post #121

diggernet wrote: post #120

Earlier quoted context omitted.

Because printing more dollars reduces the value of each one, so they've been paid back with dollars worth less than the ones they loaned out.

But even if that's true - does printing more dollars affect the price of crude oil on the international markets for instance - if the interest accrued on those loans exceeds the loss of value due to inflation, then they're still ahead overall. And that's the sort of thing that people take into account already when making investments. And that's not considering that the same would happen with any alternative investmen…

This is all true, but look at the context of discussion... Why would someone be discouraged from making future loans if the government printed money for the purpose of paying them off? Because the government took action which directly and intentionally reduced the return on their investment beyond what they anticipated in their original analysis. That will effect their analysis for future loans, reducing the appeal of those loans. Thus discouraging them.

Re: U.S. Is World’s Most Competitive Economy for First Time in a Decade

#123

Post by dreeves » Fri, Oct 19, 2018, 12:41 AM UTC

tomjen3 wrote: post #119

IMTDb wrote: post #46

Earlier quoted context omitted.

Which is even scarier. In case of default, discretionary items can be seize and sold to at least repay part of the debt (while decreasing quality of life). 2008 has shown what seizing houses leads to. Now think that there is nothing to seize for student debt loans. If you fail to get a good enough income using the degree you paid using debt, you are as hopeless as if you had used it all on hookers and cocaine. At lea…

Cars might hold some value, houses might hold more value over time, but TVs? Don't expect much. What we need is to make college debt discharable through bankruptcy, same as any other debt. Then the only people who can borrow are those likely to be able to pay it of, which nicely solves the problem of unplayable college debt (while reducing the interest students of medical, science, law etc have to pay, since more mon…

Ha! Can we use that footnote in our marketing copy? :)

Re: U.S. Is World’s Most Competitive Economy for First Time in a Decade

#124

Post by tomjen3 » Fri, Oct 19, 2018, 6:25 PM UTC

dreeves wrote: post #123

tomjen3 wrote: post #119

Earlier quoted context omitted.

Cars might hold some value, houses might hold more value over time, but TVs? Don't expect much. What we need is to make college debt discharable through bankruptcy, same as any other debt. Then the only people who can borrow are those likely to be able to pay it of, which nicely solves the problem of unplayable college debt (while reducing the interest students of medical, science, law etc have to pay, since more mon…

Ha! Can we use that footnote in our marketing copy? :)

Sure