alt Hacker NewsThere's no chance US will default on its debts, all it has to do is to print more money.
Inflation may spirale, but it's going to be a US citizens problems (as well as US bond holders) in terms of inflation and budget cuts.
Replies
We're at a crossroads: If you don't behave like you will pay your debts then people are going to assume that you will not. Before you know it you won't be able to pay your debts even if you wanted to.
>problems..as well as US Bond holders
right, why would you want to hold US treasury bonds especially if the value of the US dollar is being destroyed? Even if I believed that the US wouldn't default on its debts, or come up with flimsy arguments why it shouldn't have to pay all of them
https://www.reuters.com/markets/us/trump-says-us-might-have-...
it just doesn't seem like a super-smart investment at the moment.
At this point, nobody trusts the US to pay anything. I don't have an opinion on whether they'll be able to pay their debts, but that's largely irrelevant. I wouldn't bet on them actually paying anything. You can't trust America
If the US invades Greenland, and is at war with Denmark, will it still pay its debts to a Dane?
Dollar inflation is a way for the US to default on its debts.
"Here are the dollars we owe you. They're worth half as much as the ones you paid us."
> There's no chance US will default on its debts,
Why not? It has happened* before therefore it can/will happen again.
* (more or less). I would count significant debt restructure (1790) or replacing promised gold with paper (1860-1930, 1970) or even a significant delay (1979) as a default... even if it was temporary in 1979.
This "solution" looks like the same problem to people holding the debt.
Ergo, they increasingly do not want to hold that debt.
It will also be a global problem and not just US citizens, as the dollars underpins a vast amount of global wealth and trade.
There is no chance US will need to take Greenland by force ( financial or military) , all it has to do is to increase the number of troops already stationed there by agreement.
Yet here we are.
Defaulting on the debt would be a great “emergency” that requires elections to be cancelled…
Are you disagreeing with the parent post or agreeing with them? I first read your comment as if it was disagreeing with them but then noticed the parenthetical "(as well as US bond holders)" in your comment, which seems to support parent's position.
US doesn’t really pay back the principle — States usually roll over. So there is a concern that the future batch of US treasury is less reliable. Plus there is also the risk of a depreciating USD.
> There's no chance US will default on its debts, all it has to do is to print more money.
The US defaulting on its debt seems to be the plan.
The Mar-a-Lago Accord, or the Plan to Crash the US Economy -- https://umairhaque.substack.com/p/the-mar-a-lago-accord-or-t...
I don't think it is that easy though. If you are simply trying to pay off existing debt sure, but we constantly need new debt as well so there is a limit to how much money we can print.
As far as I know, Trump is unique among American leaders in having mused stupidly in public about not paying all holders of US Treasury debt.
But I'm sure he would not do anything crazy. That's just inconceivable.
>all it has to do is to print more money.
Isn't that considered a "technical" default since you basically burned every debt holder by inflating your way out of debt? Almost like a TKO vs KO in boxing?
> There's no chance US will default on its debts
Until Trump says he's going to, then his boosters will declare its a genius maneuver and actually its Joe Biden's fault (Joe made him do it!)
https://www.reuters.com/world/us/trump-plays-down-consequenc...
Now, Trump is an opportunist and in the psat his talk of default has been a way to throw rhetorical stones at his political opponents and keep himself in the news while he was out of office. Back in office, he has sought to project some kind of commitment to fiscal responsibility and financial stability.
But let's be real here, he's making threats against a fellow NATO member on the daily and openly saying he wants to annex territory. If he gets it into his head that the Danes or the EU are being mean to him and hurting his fee-fees, he's fully capable of responding in irrational fashion and has a toxic personality cult that will back him up. Be honest, if I took this month's headlines and took a time machine a year into the past, would 2025 you have believed my warnings about what would be happening 1 year into the second Trump admin?
You’re assuming the people in charge are sane, rationale, and value past decisions that have worked out. It’s quite clear with the now likely permanent damage to NATO this isn’t the case.