The four times the United States government defaulted on its debt (2021)
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Re: The four times the United States government defaulted on its debt (2021)
#2> The fourth default was the 1971 breaking of the U.S. government’s commitment to redeem dollars held by foreign governments for gold under the Bretton Woods Agreement.
Bretton Woods is a fascinating topic on its own. Accidental Superpower is a good read that dives in a little, but isn't focused specifically on it. I can't resist bringing up that book because in one of the later chapters, it predicted the invasion of Ukraine, IIRC, down to the month.
Re: The four times the United States government defaulted on its debt (2021)
#3Is it time to start diversifying my retirement money into international company index funds?
Re: The four times the United States government defaulted on its debt (2021)
#4Is it time to start diversifying my retirement money into international company index funds?
I seem to recall in 2021 when the last debt ceiling issues emerged the same political cosplay took place. It's being used as leverage, last time it was close too, they ultimately got it across the line.
House approves debt ceiling extension through early December: https://edition.cnn.com/2021/10/12/politics/house-vote-debt-...
White House rules out concessions over debt ceiling while GOP refuses to help avert crisis : https://www.washingtonpost.com/us-policy/2021/09/20/white-ho...
House passes debt ceiling increase, sending it to Biden to avoid default hours before deadline : https://www.cnbc.com/2021/12/14/debt-ceiling-democrats-to-vo...
Re: The four times the United States government defaulted on its debt (2021)
#5> The fourth default was the 1971 breaking of the U.S. government’s commitment to redeem dollars held by foreign governments for gold under the Bretton Woods Agreement. Bretton Woods is a fascinating topic on its own. Accidental Superpower is a good read that dives in a little, but isn't focused specifically on it. I can't resist bringing up that book because in one of the later chapters, it predicted the invasion of…
The past Bretton Woods system and US currency seemed to change from a process which can converting notes into precious metals into a process which can convert notes into military hardware and oil. Is there a name for this?
Re: The four times the United States government defaulted on its debt (2021)
#6So this is why MSFT has a higher credit rating than the US government.
Re: The four times the United States government defaulted on its debt (2021)
#7The US Government has never defaulted on its debt under the current (~50 year old) global financial system.
It HAS defaulted when transitioning off the gold/silver standard, when the world moved off Breton Woods, and during the Civil War.
I’d note that each of those defaults were related to the total collapse of the existing rules for national/global finance.
So ultimately, these defaults do bolster the case for the “never defaulted” folks: a default could literally bring an end to the current global financial system.
Edit: corrected 75->50 year old system
Re: The four times the United States government defaulted on its debt (2021)
#8The US defaulting isn't really the most interesting topic at this point - scenarios where it honours its debts became implausible a while ago. It'd be much more interesting to get an honest insight into the views of the Chinese & Japanese leadership (two countries with the largest US dollar holdings) on what they think they are getting out of this.
The numbers are obvious - someone isn't going to be getting much in the way of real repayments. It isn't quite clear who yet where the hammer will hit (my guess is #1 pensioners, #2 foreigners). What do the foreigners think is going to happen? Did they actually buy the outrageous line that the path to prosperity was feeding goods into the US consumer for paper? It seems a tough sell that anyone in a foreign government believed that.
Re: The four times the United States government defaulted on its debt (2021)
#9> The fourth default was the 1971 breaking of the U.S. government’s commitment to redeem dollars held by foreign governments for gold under the Bretton Woods Agreement. Bretton Woods is a fascinating topic on its own. Accidental Superpower is a good read that dives in a little, but isn't focused specifically on it. I can't resist bringing up that book because in one of the later chapters, it predicted the invasion of…
The conflict has been going on since 2014. I'm interested in what was actually predicted.
Re: The four times the United States government defaulted on its debt (2021)
#10> The fourth default was the 1971 breaking of the U.S. government’s commitment to redeem dollars held by foreign governments for gold under the Bretton Woods Agreement. Bretton Woods is a fascinating topic on its own. Accidental Superpower is a good read that dives in a little, but isn't focused specifically on it. I can't resist bringing up that book because in one of the later chapters, it predicted the invasion of…
The past Bretton Woods system and US currency seemed to change from a process which can converting notes into precious metals into a process which can convert notes into military hardware and oil. Is there a name for this?
The "petrodollar". But more fundamentally the bit of Bretton Woods that survived was the deal that the United States would guarantee the security of global trade (that's the Navy's real mission) in exchange for a discount on imports. Unlinking from gold only cemented their position.