Posted on 10/10/2013 1:33:21 PM PDT by Responsibility2nd
If Congress doesn't raise the debt ceiling soon, the U.S. government won't be able to pay its debts. Here's who the government owes money to — all the holders of U.S. Treasury debt, broken down by category and by how much government debt they hold.
For more, see our story: What A U.S. Default Would Mean For Pensions, China And Social Security
I’ve always wanted to have time to sit down and understand exactly who owes who what from a governmental standpoint and then recommend just cancelling values against each other. For example France owes britain 30M, britain owes france 40 and italy owes britan 10 and france owes italy 10 if you add it all up it washes out or maybe one country only owes another country 5 or something. Seems to me there is a spiderweb looking for a flame is all.
When Obama’s ready to put the squeeze on we know he’ll go after what will cause American citizens the most pain - and that will be private pensions. We know how dems operate now - whatever causes maximum pain to everyday citizens.
Because Obama would direct the income to be used to pay expenses before debts.
The longer we stay on the German model, and not on the British one, the value of the debt held by Japan and China will diminish in real terms. And with it, will also go their desire to continue to prop us up financially. They will lose their “stake” in the US economy. At some point, they will write off that debt as worthless, and the dollar will cease being the world’s reserve currency.
Walking away from, or diluting out through money printing, the Japanese and Chinese debt will not benefit the U.S. Beyond the Greenback losing international credibility, the gain from 'default' will still leave $200 trillion or so of unfunded liabilities, all of which are either literally or effectively indexed for inflation (SS, Medicare, Medicade, Obamacare, etc.). Those who think that they are being smart about this will be proven incorrect. The denouement will likely occur in a similar time frame to your German example: five years or so.
The five years of the German notes is what hit me when I read about it. That seems to be the most common term of our Treasury notes that are being floated. So yes, I would go with your five years.
By the way, I read about his in Volume 1 of Hew Strachan’s “The First World War.” He devoted a good of that volume to how the war was financed. It was pretty dry, but in the end well worth reading.
Uh, no. It’s $148 grand per taxpayer. Per citizen it’s $53 grand. Which means only about one-third of the citizens are taxpayers nowadays.
Thats all the projected SS and Medicare and GSIS and VA benefits. To be paid by future revenues (taxes) and by future borrowing.
This stuff here is just the actual amounts borrowed so far.
That’s assuming all countries are equal risks. If we lent money to Africa, China’s not going to let us cancel what we owe them just because Africa doesn’t pay us.
True.
There is no easy way out.
Best way out of this that I can see is in fact a couple of years of hyperinflation, followed by a “revolution”, or rather a general political change of heart, followed by a rational and parsimonious government.
Thats more or less what the Germans got in the 1920’s BTW, they were doing much better by 1930, until the Great Depression screwed everything up again and eventually gave them the Nazis.
That optimistic scenario doesn’t seem likely in our case. Argentina has been in this boat many times and has never recovered.
The Weimar government actually did rather well given the very bad cards they were dealt.
I doubt our system will manage as well.
We could begin by defunding NPR.
I agree. WHY are they still operating? They are nothing but non-essential government employees.
Our cash?
I took the $$$ we owe to Japan in bonds
and divided by their population of 127 million people.
are you answering a different question?
Thanks for the clarity.
Quantitative easing is simply creating fictitious money and then lending it to oneself.
This is a federal offense for anyone except the Federal Government.
I know, but I’ve always worked complex problems through cancellations and simplification first then and only then addressing the underlying real issue.
I think the govts keep it complex on purpose to prevent as much as possible the “serfs” understanding of what is really going on.
Agree - defund NPR.
And tell the feral reserve to go pound sand.
The issue is that Obama could artificially cause the default to happen because he knows his MSM groupies will be working overtime to say that if he forces a default by his own actions it is still entirely on the Tea Party. And the House GOP may not be able to do much to counter it.
The reality remains that we have the Evil Party and the Stupid Party, and right now this reality is rearing its ugly head higher than it has in a long time.
liberals cannot do math... china’s debt rectangle is supposed to be half the other foreign countries at 2.6... yet the china rectangle is not half. NPR does not do graphs well. or the truth.
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