Does America Need to Consider a Creditor's Agreement to Stop the National Debt

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Quote from Humpy:

There is a small group of people in Europe that have ruined a whole continent's economies. Do they even admit it and say sorry ? No they don't !

The crime is probably too big for the legal system to comprehend but I really don't see why they should be allowed to disappear back into the woodwork on huge pensions after such an incompetent performance.
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Neither do I, but what does that have to do with the dicusssion on how to deal with the American deficit?
 
Do you understand the impact of the sovereign default of the reserve currency?

The US does not have a problem with its interest payments. By definition, it will never have such a problem. I'm not sure you understand this point.

I don't mean to be rude, but do you have any background on this subject? If not, I think I might be having a technical discussion with someone who doesn't know the technicals.

Quote from morganist:

It would not be debasing if it did not have problems with interest payments. Do you not understand the impact increasing the currency units to pay off debt will have on global trade and oil? Not to mention the impact on the domestic economy.

A creditors agreement is something that will make the debt more manageable.
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Quote from CT10Gov:

Do you understand the impact of the sovereign default of the reserve currency?

The US does not have a problem with its interest payments. By definition, it will never have such a problem. I'm not sure you understand this point.

I don't mean to be rude, but do you have any background on this subject? If not, I think I might be having a technical discussion with someone who doesn't know the technicals.
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You clearly do not understand the impact of QE. It is as much a default as a creditor's agreement. It appears to be you who does not understand the impact of QE. How can you not appreciate the impact devaluing the currency has on the reserve value and in addition the impact it will have on oil prices?

The biggest impact will be through QE. A creditors default now would be a lot less damaging than the QE needed. QE can create a currency war, which be hugely damaging. The creditor's agreement will rearrange the debt to enable repayment. It may infact improve the position of the currency if it prvents further QE.

The proposition in the paper is to cut the interest payments which will compound over time. It is well noted the US national debt is enormous and the interest payments are growing due to compounding.

You keep saying things without any explanation. For example.

"The US does not have a problem with its interest payments. By definition, it will never have such a problem. I'm not sure you understand this point."

What is your rational for this. Is there empirical evidence?

If the US is currently needing to borrow $1.3 trillion in debt for federal expenditure and then pay $230 billion a year in interest on the exisiting debt then you have a problem with your deficit and it is growing by around ten percent every year. You say that the interest payments are not a problem yet they either increase the deficit by another quarter of a trillion a year or require QE, which will reduce the value of the dollar, which could trigger a currency war, impact domestic prices and create problems with the oil market.

You are not making any real arguments or anything to comment on. You are simply just saying I am wrong and then insulting me. That does not suggest you have an alternative position to the one I am making. What figures or position are you criticising? What fundamentals am I lacking in. Please give me a detail explanation. I have provided you with one, which includes empirical data.

You ask do I understand the impact of technical default. Yes I do but I don't think you understand the impact of the alternatives. I am not saying it is an ideal solution however it may be the only option America has.

The only possible argument you could make that QE is not a default is that a group of people said it is not. It is as much a default as bankruptcy or a creditor's agreement as in the creditor's will lose value on what they expected in real terms. That is a default. Even if a group of people disagree with that the market will see it that way.

If you want to discuss the subject you have to actually provide some substance to your argument rather than saying "You are wrong" "You don't understand" "I know better than you" "You don't understand what you are talking about". What makes you think your position is to understand this better than mine. What credentials do you have, what arguments or position can you put forward, what empirical data or papers do you have?
 
If I recall correctly the US debt was about $3 trillion after Bush. Now it's about $16 trillion ! And the very same big spenders are asking to be re-elected. Another 4 years of gross incompetence and the US debt should be nearing $30 trillion. How many generations will it take to pay off ?

I have little faith in the good sense of the US public to elect the least worse man.

As to paying it off, its obvious - cut costs. The military budget is greater someone said than all the rest put togethor. And achieves next to nothing. Are there still 50 known bases in Germany alone, plus a lot more elsewhere ? Probably. Are the clods in Washington aware that WW2 is over ? Also the Cold War ? Doesn't seem to have registered yet ?
 
Quote from Humpy:

If I recall correctly the US debt was about $3 trillion after Bush. Now it's about $16 trillion ! And the very same big spenders are asking to be re-elected. Another 4 years of gross incompetence and the US debt should be nearing $30 trillion. How many generations will it take to pay off ?

I have little faith in the good sense of the US public to elect the least worse man.

As to paying it off, its obvious - cut costs. The military budget is greater someone said than all the rest put togethor. And achieves next to nothing. Are there still 50 known bases in Germany alone, plus a lot more elsewhere ? Probably. Are the clods in Washington aware that WW2 is over ? Also the Cold War ? Doesn't seem to have registered yet ?
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Cuts are good but you need to stop the coumpounding interest effect. In regards to why there are so many military bases in Germany it is for two reasons the first is it stops Russia invading the west. I don't know if that is really a big issue now. The second is it has to provide Germany with military protection or risk them having their own army again. Do you want that?
 
Quote from Random.Capital:

All that's needed is voters to give a damn about the debt.

And without that, NO mechanism will work.
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At this point, the debt no longer matters.
It can never be paid.
 
Quote from BSAM:

At this point, the debt no longer matters.
It can never be paid.
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+1.

The only course now is the grand reset. It wont be just us though, it will be coordinated with the EU and Asiapac.

So for now its a race to zero with all the parties involved. Print till they cant print no more, then jubilee.
 
Look I'm not an economist, but I think I'm as good of an economist as any "economist" out there.
Here's what I know that they don't: If I have one dollar, I can't spend 2 dollars.
 
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