Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

U.S. Debt Hits $40T as America's Borrowing Binge Continues

nytimes.com

Post reply on HN
Print view View original

91–100 of 227 posts

Re: U.S. Debt Hits $40T as America's Borrowing Binge Continues

#91

Post by preg_match »

qzx_pierri wrote: post #32
rhelz wrote: post #29

Earlier quoted context omitted.

The federal government is actually quite efficient in what it does. For example, the overhead for Social Security is between 0.5% and 1%. I.E, less than the mutual funds in my 401k charge per yeah for "administrative fees." When people talk about government waste, what they really are talking about is things the government does which they don't approve of. E.g. ICE--is that wasteful spending? Depends upon whether you…

[flagged]

This isn't a refutation or even an argument. If something was obviously incorrect, you would think it would be trivial to prove wrong. But, evidently not.

The idea that the government is inherently inefficient is an idea that GOP just made up ~50 years ago to justify tax cuts for the rich. Tax cuts which, by the way, got us into this debt mess. This all started with Reagan, who royally fucked our government fiscally.

The only people who have been able to control the deficit are, surprise surprise, democratic administrations. Just look at the numbers, ignore the propaganda. This stuff is cut-and-dry.

Re: U.S. Debt Hits $40T as America's Borrowing Binge Continues

#92

Post by SpicyLemonZest »

partloyaldemon wrote: post #86
epolanski wrote: post #52

Earlier quoted context omitted.

It's literally impossible to default as you can simply emit new money and buy back the debt or pay the interest with the minted money. Of course this comes with its own set of gigantic issues, likely triple digit inflation and hardship to raise money for generations. But US can't default really.

You’re the only one in the thread that gets any of this right. But: Monetizing the debt is replacing one asset (treasuries eg) that pays interest with a nominally equal asset that doesn’t (US dollar). How does that spur inflation? It’s a reduction in income over time. How does paying back our debt IN FULL hurt our credit worthiness?

Money is special because it’s the only asset that can be used to purchase goods and services. If I have a pile of 10 year Treasury bonds worth $500, and I want to buy a TV, I have to first convince someone with $500 in cash that they’d rather have my bonds than buy their own TV.

Re: U.S. Debt Hits $40T as America's Borrowing Binge Continues

#94

Post by 2dddd »

epolanski wrote: post #52
motbus3 wrote: post #50

I am ignorant. If they don't pay, who will charge it if the default?

It's literally impossible to default as you can simply emit new money and buy back the debt or pay the interest with the minted money. Of course this comes with its own set of gigantic issues, likely triple digit inflation and hardship to raise money for generations. But US can't default really.

Ofc the US can default and it will most likely in the event.

Debasement is far more painful - the treasury will simply choose not to come good on the obligations.

Re: U.S. Debt Hits $40T as America's Borrowing Binge Continues

#95

Post by 2dddd »

xarwex wrote: post #56
motbus3 wrote: post #50

I am ignorant. If they don't pay, who will charge it if the default?

A country that controls its currency can always bail itself out of all debt by printing all that money. Now they would destroy their whole economy in the process because of inflation and countries being mad about a country doing that. If they don't pay and default they kind of also piss everyone off and that makes the curency rates fall as well. In that case they would repay as much as they want really, the price for…

Inflation doesn't really capture what would happen.

Debasement is the appropriate term.

Re: U.S. Debt Hits $40T as America's Borrowing Binge Continues

#96

Post by jambalaya8 »

unrented7977 wrote: post #53
jambalaya8 wrote: post #12

Earlier quoted context omitted.

It really already did lose its reserve status, in a manner of speaking. There isn't ever going to be a gold standard again (even if there is, would the actual gold have the sort of real life uses it had when the gold standard was around? Not like people fill teeth with it anymore unless you are some sort of thug).

Gold is a fantastically useful element. It's vastly more useful today as our knowledge and application of chemistry has improved. It's probably more in demand as a commodity today than it ever has been.

I hear platinum is the way to go. Or iron.

Re: U.S. Debt Hits $40T as America's Borrowing Binge Continues

#97

Post by 2dddd »

SpicyLemonZest wrote: post #92
partloyaldemon wrote: post #86

Earlier quoted context omitted.

You’re the only one in the thread that gets any of this right. But: Monetizing the debt is replacing one asset (treasuries eg) that pays interest with a nominally equal asset that doesn’t (US dollar). How does that spur inflation? It’s a reduction in income over time. How does paying back our debt IN FULL hurt our credit worthiness?

Money is special because it’s the only asset that can be used to purchase goods and services. If I have a pile of 10 year Treasury bonds worth $500, and I want to buy a TV, I have to first convince someone with $500 in cash that they’d rather have my bonds than buy their own TV.

No thats not true.

It operates under expectations - the more liquid the asset, the more likely you'll be OK with accepting it in the context of a trade. The discount is for illiquidity.

Re: U.S. Debt Hits $40T as America's Borrowing Binge Continues

#99

Post by b1gTekken »

Ohentis wrote: post #85
b1gTekken wrote: post #72

Earlier quoted context omitted.

Financially ledger is just a social construct; the IOUs of the past are never paid off as they never mattered. Finance shit just keeps innumerates and those ignorant of physics believing wild end of the universe theories. For more look up Debt jubilee's; humans wiped the debt of the dead off the books and no black holes opened within the sun, no gods descended from Olympus and slaughtered the children Fucking mesmeri…

Occasionally countries do default on debt. It doesn't go well.

Life is the leading cause of death

Re: U.S. Debt Hits $40T as America's Borrowing Binge Continues

#100

Post by clickety_clack »

GuB-42 wrote: post #81
motbus3 wrote: post #50

I am ignorant. If they don't pay, who will charge it if the default?

If you are American, then it is you, for the most part. Most of the US government debt is owed to institution and people in the US. All these retirement funds, social security, health insurance, etc... that own part of the government debt... well, you won't get what you paid for. This is a simplistic and partial view, but I think that's the most personal way of thinking about it.

That’s about it. You’re paying for roads and education and war with your retirement savings. There’s not really anyone else there to pick up the bill. There’d better be some kind of return on that investment so you can actually retire.

Printing more money devalues the currency your retirement is priced in, so that’s not an escape either.

Post reply on HN