Posted on 05/06/2016 5:38:20 AM PDT by reaganaut1
One day after assuring Americans he is not running for president “to make things unstable for the country,” the presumptive Republican nominee, Donald J. Trump, said in a television interview Thursday that he might seek to reduce the national debt by persuading creditors to accept something less than full payment.
Asked whether the United States needed to pay its debts in full, or whether he could negotiate a partial repayment, Mr. Trump told the cable network CNBC, “I would borrow, knowing that if the economy crashed, you could make a deal.”
He added, “And if the economy was good, it was good. So, therefore, you can’t lose.”
Such remarks by a major presidential candidate have no modern precedent. The United States government is able to borrow money at very low interest rates because Treasury securities are regarded as a safe investment, and any cracks in investor confidence have a long history of costing American taxpayers a lot of money.
Experts also described Mr. Trump’s vaguely sketched proposal as fanciful, saying there was no reason to think America’s creditors would accept anything less than 100 cents on the dollar, regardless of Mr. Trump’s deal-making prowess.
“No one on the other side would pick up the phone if the secretary of the U.S. Treasury tried to make that call,” said Lou Crandall, chief economist at Wrightson ICAP. “Why should they? They have a contract” requiring payment in full.
Mr. Trump told CNBC that he was concerned about the impact of higher interest rates on the cost of servicing the federal debt. “We’re paying a very low interest rate,” he said. “What happens if that interest rate goes two, three, four points up? We don’t have a country. I mean, if you look at the numbers, they’re staggering.”
(Excerpt) Read more at nytimes.com ...
So wrong
Yep...what you said...any GOP would get blamed.
If I had a crystal ball I would be in the market and not posting on FR :). But I can predict the system falling apart for sure if Trump demands haircuts on US Bills and Bonds.
The Federal Reserve is NOT a voluntary contract.
The people are not obligated to pay. It is not like a car payment.
No nation’s people are required to pay their central bank.
Zip. Zilch. Nada.
Central banks are a fool’s scam.
Govt is the Big Lie.
Go Trump Go!
Healthcare is close behind entitlement spending as a percentage of gdp and is inflating at a higher annual rate. take care of healthcare reducing it to align with other 1st world counties and we may have a chance to take care of the other problems.
In other words he wants to do the Greek strategy. Tell them you’ll default unless that agree to take less than they are owed. But I have to say I think that is actually inevitable irrespective of what Trump says. He’s doing us a favor by saying it now rather than pretending the problem doesnt exist.
“Russians paid Soviet ruble debt in devalued currency.
full pensions bought a bag of potatoes in the 90s.”
Historically that is the preferred way to pay debts you can’t afford.
Just inflate the money. You owe a trillion dollars. If a loaf of bread costs $ 1 trillion, then your entire debt becomes a loaf of bread. Of course that wipes out everyone’s lifetime of savings, but if you’re not elected by the saver class anyway, who cares.
And somehow the supposedly conservative Cruzer Losers can’t GET that little fact. Trump is the recipient of the largest financial sh!t-pile in the history of all mankind, and to badger him about the incoming disaster is pathetically shortsighted.
NO solution at this point is going to be pleasant or come without significant crisis, no matter if Trump or Cruz or the Kool-Aid Man says it.
What nonsense is that. I was for Cruz. I'm voting for Trump.
But a KOOKIE IDEA is a KOOKIE IDEA. This has nothing to do with Cruz. Cruz is gone and we have Trump. Defend his KOOKIE IDEAS if you like but stop poking at Cruz. Trump is the guy we want to win. And I think most Cruz supporters will agree with that. Not all, but most.
If I were one of those creditors, and was offered the choice of ten cents on the dollar now, or certain collapse in the future, I know what I’d do.
I'm not so sure that will hold up. But I admit to not checking in on how Greece is doing with this issue. Do you know how it is going? That might tell us something.
So until I hear a really good argument in favor I'm going to keep my KOOKIE IDEA label on this latest from Trump.
It’s still up to Trump to learn how to dodge these questions. This will hurt against Hillery.
Trump’s not wrong either. Default is the only way this debt doesn’t destroy us, but saying it publicly is foolish.
“If I were one of those creditors, and was offered the choice of ten cents on the dollar now, or certain collapse in the future, I know what I’d do”
I’d sell the bonds today for full value.
I expect debtor nations of the sort you mention to begin forming debt cartels and leveraging their position for generous settlement terms.
When faced with the prospect of less or nothing, less seems like a good deal.
It is also ridiculous in the extreme to wax sanctimonious about the Federal debt. Since Roosevelt devalued the dollar in 1933, reinforced manifold when Nixon took us off the gold/exchange standard, a falling dollar has cheated debt holders with regularity.
The New York Times is pretentious. It is not fair, balanced or even particularly well informed. It certainly does not respect any sort of journalistic duty, worth defending, in its dealings with its readers.
True enough but sometimes it is impossible to dodge them without looking uncooperative which would be the next step.
I detest the lefty press. Ever hear one of them lead someone like the lady felon into a blind canyon. When they are putting on the bracelets, one will ask if she like the matching colors long before they ask whether she will plead guilty!
“Trump is absolutely clueless about how things work.”
____________________________________________
So clueless, in fact, that he’s a billionaire.
So clueless that he’s won the GOP nomination with unprecedented voter turnout and tiny expense.
Someone’s clueless alright, and they also triple post.
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