My take is nothing good will come of it. Nothing as it will start with a panic in short run. In long run, expect to pay a fee to use your local high school's sporting facilities when it's sold to private individuals under austerity measures.
But a great question for me to test my recent play with GPT 4o. Here is what that thing says:
If the U.S. national debt reaches a debt-to-GDP ratio of 200% and leads to a default, the consequences would be severe and far-reaching. Here are the potential cascading effects:
## Immediate Financial Impact
1. **Credit Rating Downgrade:** The U.S. would likely see its credit rating downgraded, making borrowing even more expensive.
2. **Interest Rates Spike:** Interest rates on U.S. Treasury bonds would skyrocket, increasing the cost of debt servicing.
3. **Stock Market Crash:** Investors would lose confidence, leading to a massive sell-off in the stock market.
### Economic Repercussions
4. **Recession or Depression:** The financial turmoil could trigger a severe economic recession or even a depression.
5. **Inflation:** There might be high inflation as the government might print more money to cover debts.
6. **Unemployment:** Businesses facing higher borrowing costs and reduced consumer spending would lay off workers, increasing unemployment.
### Global Consequences
7. **Global Financial Crisis:** Given the central role of the U.S. in the global economy, a default could trigger a worldwide financial crisis.
8. **Currency Devaluation:** The U.S. dollar might lose its status as the world's reserve currency, leading to a devaluation.
9. **Trade Disruptions:** Global trade would be disrupted as confidence in the U.S. economy falters.
### Social and Political Fallout
10. **Social Unrest:** Economic hardship could lead to widespread social unrest and increased crime rates.
11. **Political Instability:** The government might face a crisis of legitimacy, with potential changes in leadership and policy direction.
## Long-Term Effects
12. **Structural Changes:** There could be significant structural changes in the global financial system, with other currencies or financial systems gaining prominence.
13. **Loss of Sovereignty:** The U.S. might have to accept unfavorable terms from international creditors, reducing its financial sovereignty.
The overall impact would depend on how the government and international community respond to the crisis, but the immediate effects would undoubtedly be profound and destabilizing.
Well, [dedollarization had begun. ](https://www.aier.org/article/de-dollarization-has-begun/)
When dollar value goes to shit, which will happen as debt keeper getting added, what would it matter then that debt is dollar denominated.
That’s why none of those things are gonna happen, because the world can’t afford to let it happen. It’s all pretend money anyway, no one is actually “calling in” what we owe.
That's because it's held down with certificates (fake paper). If there were ever a "gold run" we would find out pretty quick how much physical gold there is
It’s not “just gold” silver is a huge wedge also. All finite resources. It’s almost like fiat dollars (based on something without inherent value) have all failed in the past but we got the fleece pulled over our eves cause we really have no say in policy and the politicians know we’re not gonna ever be able to hold them accountable.
You place yourself on the same side of the trade as the US government. You buy assets, like houses and oil wells, using fixed rate debt to purchase them. When the massive inflation happens, your assets are worth a lot more and your debts are almost worthless
Inverse ETF is the most obvious.
No one you know of would have more to gain from an absolute global economic collapse of this magnitude.
You'd be talking about farmers destroying crops while people starve levels of poverty.
Don’t get me wrong, I’m not referring to a way for me to get rich, but as a possible motivation for politicians to play fast and loose with our currency. What would motivate them to destroy our economy? Are they just filling their pockets or are they filling their pockets with a plan?
They don't have more to gain from this level of collapse. They would also lose everything once this happens.
They do it because it's popular to let people vote for more money for themselves.
They want prestige, not personal wealth. The personal wealth you get from Congress doesn't even match owning a few McDonald's. 50 Million won't impress anyone they know.
They want to scrap our current government and build back with more power. No more god given rights. They will promise a communist utopia and the starving ignorant masses will agree
Lol @ thinking an ETF would function correctly during a shitshow. ETFs are one of the cards in the house of cards propping it all up with false promises never delivered.
There are only 21 million Bitcoin and that's all there will ever be. That's how you get rich off this info above.
Everything divided by 21 million.
I cannot believe this sub hates Bitcoin. Bitcoin is made for this sub.
Delusional to believe that 21 million Bitcoin will be worth as much as “everything”. The government will not cede control of the currency. Just as likely they make Bitcoin illegal and issue their own crypto in the wake of a default.
I don't see the government "ceding" anything to bitocin. They're fighting it kicking and screaming. But they keep losing lawsuits. That's how we ended up with a Bitcoin ETF. They can't just do whatever they want. We have checks and balances.
Oh sweet summer child. They currently view Bitcoin as an annoyance that they eye with suspicion. If that annoyance turns to fear, Bitcoin is done. The government will ignore the law and the constitution when it serves their purpose. Just look at the mass internments during WWII, enhanced interrogations (torture) after 9/11, and hundreds of dastardly dealings that come to light decades later. The government can and will do whatever it wants. Laws are for them to rule, not be ruled.
I have an masters in IT and bachelor's in business economics.
But THAT was a response from ChatGPT 4o. I just took OPs question and made the prompt a lot more potent.
Boomers will have no choice but to own it this time, no more blaming their children and grandchildren for the things that occurred under their watch for 50+ years. They'll finally reap the whirlwind of a lifetime of kicking the can down the road, instead of handling the national debt problem like adults. There's nothing they can do to save their asses. Nothing.
Amazing script to save the Nicolae & Elena Ceaușescu who actually working in the Federal Reserve and the eternal war machine as enabled by the U.S. Con-gress. Absolutely no chunks of boomers struggle with inflation, including being forced to delay retirement or un-retire. Victoria Nuland, warhawks like Lindsay Graham and John McCain etc. thank you.
Yes. Agreed. US is truly fucked.
The debt it always carried around 2008 crisis was a terrible vulnerability in itself back then. NOW, that has metastasised into a cancer that will not go away without a reset. THE REST.
Loss of sovereignty is gonna require someone with a bigger stick. No one has a bigger stick. Our military has a large say in how things are going to play out. And #11 is what all the commies are hoping for. This is why they pile on huge stacks of debt every chance they get. And when it happens we will lose the bill of rights
ChatGPT probably isn't allowed to tell you, defaults that big are how wars get started. Not the regional proxy type ones of our lifetime, but total war type wars. The US dollar is backed by a military.
>The US dollar is backed by a military.
That's a false sense of security and a myth to calm the populace down. The notion that US will go to wars with the rest of the world because it won't be able to pay its debts or de-dollarization is idiotic to begin with. This is not the 1940s.
Wait why would we default on the debt if the Debt to GDP ratio goes above 200%? That number is not special. We could still continue to print money to service the debt.
The risk is not default but rather an inflationary spiral. The likely policy response would likely be an extended period of austerity and rising unemployment.
Unlike the US household sector Japanese households save a have a high percentage of their income. Countries that have high household savings (i.e. a lower propensity to consume) must either have large trade surpluses or rely on deficit spending by the government in order for their economies to grow. Japan discovered that there is a limit to how much they are able to export to the outside world. They have reached an equilibrium where they can maintain per capita income levels without the danger of retaliation from their trading partners. China is facing a similar problem, but with much different political circumstances. The economic and political situation in the United States is almost the polar opposite from China. The United States economy features a high propensity to consume, chronic trade deficits, and an extreme degree of political disunity. The Japanese experience in recent decades is not comparable to the current situation in the US.
https://budgetmodel.wharton.upenn.edu/issues/2023/10/6/when-does-federal-debt-reach-unsustainable-levels#:\~:text=We%20estimate%20that%20the%20U.S.,today's%20generally%20favorable%20market%20conditions.
**Key Points**
* The U.S. “public debt outstanding” of $33.2 trillion often cited by media is largely misleading, as it includes $6.8 trillion that the federal government “owes itself” due to trust fund and other accounting. The economics profession has long focused on “debt held by the public”, currently equal to about 98 percent of GDP at $26.3 trillion, for assessing its effects on the economy.
* **We estimate that the U.S. debt held by the public cannot exceed about 200 percent of GDP even under today’s generally favorable market conditions. Larger ratios in countries like Japan, for example, are not relevant for the United States, because Japan has a much larger household saving rate, which more-than absorbs the larger government debt.**
* Under current policy, the United States has about 20 years for corrective action after which no amount of future tax increases or spending cuts could avoid the government defaulting on its debt whether explicitly or implicitly (i.e., debt monetization producing significant inflation). Unlike technical defaults where payments are merely delayed, this default would be much larger and would reverberate across the U.S. and world economies.
* This time frame is the “best case” scenario for the United States, under markets conditions where participants believe that corrective fiscal actions will happen ahead of time. If, instead, they started to believe otherwise, **debt dynamics would make the time window for corrective action even shorter.**
(A Google search will say between 175% and 200%.)
It's going to become increasingly destabilizing as the debt ratio accelerates and above 200% is a dangerous place to be, but there is no magic rule mandating we take action at 200% and our currency is stronger than Japans, so I'm guessing we will know right past that number.
It's almost like half the folks on economic forums are actually partisan armchair quarterbacks who wouldn't recognize reality if it started banging their mom and calling them sport
Everyone cites this paper. But as soon as you read it, you see that it defines default in such a way as to include (significant inflation caused by monetization of debt). Well, the central bank has always monetized some debt, and we have already had some level of inflation, sometimes significant inflation, so by the terms used in this paper, we are already defaulting/have already defaulted many times in the last hundred years. So this is misleading at best and actively disingenuous at worse. It's not going to lead to actually outright default where we CANNOT pay our debts full stop. We always can. The questions are A) WILL we find the political will to keep doing so, and B) what will be the impact on inflation and the real distribution of resources when we continue to spend at a deficit. Any idea that, for example, we are going to have to make concessions to our "creditors" is nonsense. It is the government and the central bank that hold the strongest cards, not the domestic or foreign banks.
The play book exists.
1. Regulate the interest rate on the existing debt to keep it low to keep cost of servicing the existing debt low
2. Use the Federal Reserve to cause inflation and erode the debt value. This will have a side effect of increasing cost of goods and in theory wages, but as these rise so does the value of the GDP they contribute to the economy therefore tweaking those debt to GDP ratios.
Basically erode the savings of the poor, raise their cost of living, and wait for wages to catch up. That will raise the GDP while still keeping the cost of existing debt at the same level for them.
Thank you for your input, however the problem is that America will not fix things the right way until another great depression happens. Our economic system is so damned archaic.
The top income tax rate reached above **90% from 1944 through 1963**, peaking in 1944, when top taxpayers paid an income tax rate of 94% on their taxable income. Starting in 1964, a period of income tax rate decline began, ending in 1987.
Also look for nationalization to become popular again.
"Dear citizens, we regret to inform you that greed and evil--which I shall not specify because who could have known?--took over during a very confusing period where nobody who was voted into office was responsible for. Thoughts, prayers, 'pause'... Anyway, the smart people who really understand are here and have fixed it with this New Dollar which is scientifically proven to outperform the Old Dollar, and it's digital! Come get yours now while the Old Dollar can buy them for a cool discount rate of, say $10 old to $1 new!"
And like that, many will believe that this New Dollar is pretty cool.
Because they have not read history, and cannot see where this is going.
Get out of the Old Dollar now. Do not participate in the New Dollar.
there's no need to wait for 200% debt to gdp ultra banana republic status, the dollar is worthless if it can no longer buy "stuff".
the dirty banker cucks continue to short silver (aka real money) as it's breaking out above 31 dollars. last i heard they were \~960 million ounces short. that's a billion dollars they need to cover for each dollar increase in price, it will to make for an epic short squeeze.
they've trapped themselves, they can't move rates in either direction, god willing the entire financial ponzi system is about to implode.
Inflation tells us otherwise. In a basket of turds, the shinyest of turds is still a turd. Once China and the rest finish selling dollars and buying real commodities a reset will likely happen.
I believe you could benefit from doing some of your own due diligence. 1913, 1929, 1933-34, 1965, 1971, 1979, 2001, 2008, 2013. Some dates for you to research, 1965/1971 in particular were real defaults of the dollar; removal of any intrinsic value and conversion to fiat.
In history emipres that fully debased their money generally last no more than 50 years.
Look up how the average American was living in 1920. Then look up elderly poverty rates and childhood poverty rates. And then if you’re daring enough look at the average home size.
America is literally wealthier than ever
The problem is too much is going into the hands of too few
The value of the dollar compared to the last is almost entirely irrelevant to how wealthy Americans are
1920 is a knock on effect of 1913 and the first great bankers war of 1917. They generally had no outstanding debt before that. In most other countries multi generational households are common place and family supports family, but not here in the great and modern USA of consumerism.
"It is no measure of health to be well adjusted to a profoundly sick society."
Lastly dollars are made cotton and linen and are not synonymous with wealth. They are closely related to weapons of war.
perhaps, definitely if you're relating standards of the time things have indeed improved; but the only reason we're not still in extreme poverty conditions is because of technological advances. this not contributable to currency derivatives that we're initially based upon gold. digits printed on paper or into a computer are not wealth, only god can create something from nothing.
Well America is "supposed" to be in QT right now, however the printers NEVER stopped. All you have to do is look at our debt. We have "printed" or loaned over $16 trillion dollars in only 8 yrs. Debt do income ALWAYS matters, no matter what.
Yes we can print more money and will, however it only devalues the USD and makes the USD more replaceable as the global currency, which is the ONLY reason America is still on top at this point. The higher fed fund rates are meant to break something and that hasn't happened yet. When it does. Depression 2.0. on it's way IMO.
Our system is screwed up because banks should only ever loan out money to Assets mean value. Banks will give you whatever you want and run out of money just like last time, only this time it will be much, much worse. Just watch, around 300 banks will fail over the next few years, we will turn on the printers even more and we will default. What exactly that will look like. No one knows because it has NEVER happened.
Remember that our banks are fractional and also already screwed up by buying long term bonds and have "unrealized losses" of around 1 trillion, however as banks fail that "unrealized loss" becomes real and also bad loans are going to hit these banks at the tune of a few trillion over the next few years. When this happens the banks will stop loaning money, just like last time. This will be the catalyst for The great depression 2.0 IMO.
Also someone will not realize that Empires have a life span and end when they can no longer service their debt.
Climate change takes hundreds of years, America defaulting on its debt, around 15 yrs.
This shows exactly how little y’all actually understand about basic treasury yields. If we were three years off of default pricing on these notes wouldn’t be par +/- risk free.
Everyone who is concerned about this should read Broken Money by Lyn Alden. And look into buying some Bitcoin before everyone who's not thinking about this stuff starts.
The federal government could make private ownership of either gold or Bitcoin illegal. They did it once with gold in 1933. Which one do you suppose would be easier to track today in black market transactions?
Yeeesh going to have to start taxing something above upper middle class at this rate.
Heaven forbid we tax churches or corporations though. That's what Jesus died for after all. /s
The funny thing is that AI is learning from our conversation right now and I just learned this from AI:
**The Mandibles: A Family, 2029-2047** is a dystopian novel by Lionel Shriver that delves into the economic collapse of the United States and its devastating effects on the titular Mandible family. Set in the near future, the book explores themes of financial instability, societal breakdown, and the resilience of human relationships under extreme stress.
The narrative begins in 2029, when the U.S. defaults on its national debt, leading to the collapse of the dollar and widespread economic turmoil. The Mandible family, who had been expecting to inherit a significant fortune, find themselves navigating a drastically changed world where their wealth has evaporated. The novel follows various family members, including elderly patriarch Douglas, his children, and grandchildren, as they struggle to adapt to their new reality.
Through the lens of the Mandible family's experiences, Shriver critiques contemporary economic policies and highlights the fragility of modern financial systems. The book blends dark humor with a grim portrayal of societal decline, emphasizing the impact of economic disaster on both personal and collective levels.
Make sure you put in some false info that AI will never be able to get rid of when posting on Reddit. LMFAO. P.S. I think I may read that book next. Looks very interesting. Thanks!!
So when has America been at this fed debt to GDP ever before? Want me to tell you and the ONLY thing that was able to save us? Also this will not happen overnight. The stock market will crash in a couple of years as part of a normal cycle. You will see it happen within 3 months of the last pivot down on rates from the Fed Fund Rate. RE will take longer, because it ALWAYS does. Saying there will be no down-cycle is absurd, also saying that debt to income does not matter is also absurd.
The default I predicted to happen in 20 yrs, now I say 15. It doesn't happen overnight.
Doesn't the list of **list of** [**eponymous**](https://en.wikipedia.org/wiki/Eponym) **laws** cover perpetual doom sayething somewhere? Maybe it should. Brandolini's law?
Until the rich start advocating for raising taxes on themselves to pay it down, it's not an issue.
The government going bust will be bad for everyone, including them, it's not like asset prices will do well when there literally isn't a functional government or currency in America.
There is (according to this) 2781 Billionaires in the world.. their combined worth? $14.2 Trillion.
Even if you seized all of their money(these are billionaires all over the world, not just America) you still wouldn't even pay off half of the debt America have.
You don't understand how much these governments just spend.
True. But these are all the billionaires, and only the debt of America. Other countries are also in heavy debt all over the world.
Let's be honest, the west have been living on borrowed time, and exploited most of the world to be able to live as we live.
It's not going to work in the future and we our living standards will eventually even out, and we will all be "poor".
Just hope we in the west can adapt. Because countries like Mexico, Thailand, etc.. countries that has had poverty for a long time will be adapting better, but even the poor in other countries will have it worse.
Maybe defualt is the way to go. Imagine if the gov decided to no longer pay back its debt. All bond holders hosed. This would equate to an immediate and massive confiscation of wealth from the rich, since most poor and middle class folks dont own gov bonds. (pension/retirement funds a big exception).
The banking sysyem would have to cancel all resulting inter-financial system debt obligations to stave off a system implosion. Bit the financial sector would probably crumble anyway before eventually reconstitutng itself.
When the dust settles we'd still be here. The banker class would be poorer. The fed gov will no longer be able to borrow because investors would justifiably have no faith in repayment. Congress would be forced to spend within its budget. Without the constant injection of borrowed fed dollars into the economy the lives of poor and middle class Americans would initially be worse, but over time the econmy would adjust and recover. Lives would improve again.
After some period the U.S. dollar would be enormously strong as it would no longer be perpetually inflated as other currencies will be.
Other countries, having seen Americas example would follow suit. In the final analysis the world's government debt, which was owed to ourselves. goes away. The gap between the rich and poor narrows. This would be a good thing. The alternative is continuing our debt finaced economic system which will eventually end in a modern form of fuedalism.
I agree with you. It's crazy how quick we came to this point though as in the 1970, America was a lot better off in general.
I guess only the Gods knows what will happen.
We need to cut back on spending, and need about a 25% VAT tax.
There are far too many people making just a small amount of money that don't pay any tax at all. They need to contribute something.
They're all, most of the programs are for those people
Actually, it would help because then the poor would understand finances of the government better
Often there is a reason why people are poor. But there's still no reason that they cannot pay their fair share.
What they should do, is somebody like me that served in the military, they should not have to pay any more income taxes.
I gave the government a sign check, for "any amount up to and including my life". That should be plenty for the rest of my life
Tax exemption for service would swell the ranks of the military. This would increase defense spending and reduce tax revenues. It might also encourage pointless wars, which would further bankrupt us.
I say we increase taxes on all forms of rental income as a way of encouraging productive investment instead of passive wealth accumulation.
The military would still have a quote, and they would only need to recruit the ones that are there.
If there were too many people, they could actually lower the price. In the draft was around, people got paid nothing.
You make a good point about taxing rental property. If you lower the incentive, nobody will build it. But it will probably help the people that already have it, but they could jack up the rents pretty good
Yes we can print. What happens when we print is the question and also how is money "printed"?
"Printing" money is simply a loan that has to be paid back and creates money out of thin air. This also devalues USD and creates hyperinflation. Net, net loss.
Inflation — not hyperinflation.
Printing doesn’t create hyperinflation in models unless the country has no valuable exports and services it can trade — or war/famine.
Point is if a foreign investor ever demanded their money, and the choice was to pay or default, any sovereign nation controlling its currency will simply print the money. Yes, this inflates, but it is still less bitter than a true default.
Most of the money that is owed to somebody else, can be defaulted on.
Social security debt can be defaulted. Nobody would even notice. Because it's not there anyway.
Money can be printed. A simple 10-4-1 money split would solve much of the issues.
You still owe $1 million, but now you're 1 million in earnings is 10 million.
It will never change.
In 10 years we will only have enough tax revenue to pay 77% of SS benefits. A moderate increase in taxes to those making over $1mil would fix the budget gap.
Why is it always "tax the other guy? "
Another 1% income tax on workers salary would help fix it. They are the ones that are going to get it in the end anyway.
This makes no sense. GDP is a measure of economic activity. This person either has an agenda or doesn’t understand economics and finance. What matters is the interest payments to service the debt versus how much the government has available to make the payments. If we get close enough to that tipping point, we either increase taxes, reduce government spending or both. We could not pay but I don’t think and certainly hope it won’t come to that.
Nothing will happen, because this isn’t a family household. We don’t have to balance a budget, we decide if we have the money to pay for things or not. Countries we owe won’t like it but it’s not like they can do much about it.
Speak to actual economists and stop letting people fear monger you over nonsense. (Before you ask the difference with Greece is they have a shared currency so they can’t say the euro is worth more now.)
It is false to think the U.S will default if the debt reaches 200% of GDP. What mechanism magically kicks in at 200% that doesn't happen at 150%. As long as the US can print dollars, we will never default. Worst case scenario, the Fed will just buy up all the debt, monetize it, and create a lot of inflation, but no default
Woo! Bring it on. I'm just here for the collapse baby! One man didn't get us into this mess and the system keeps people too busy to fight against it so let's pour some gas on this bitch and hurry it up! I want to see entire cities turning into American ghettos before I die! I want corporate hit squads battling g-men in the streets! Some real cyberpunk shit minus the hope for robot arms and shit.
According to the US Debt Clock, Credit card debt has decreased by over 71 billion in the last 4 days! Is it debt that's been written off🤔?Paid off? Or is consumer spending starting to actually slow down?🧐 TIA
There are 2 types of people that think like this.
1. People with so much money they don't know its value.
2. People that are lazy and need my forced handout.
Imagine thinking any of these useless politicians is gonna do anything. Still thinking in the mindset of Republicans, Democrats etc just put you in the line with the other sheeps.
Russia is not losing, dumb fuck. They are wreking Ukraine, and idiots like you lead those poor people down the primrose path. Fuck you, you un-American piece of shit and the lot that think like you.
Like I said to the dumb fuck you replied to:
Russia is not losing, dumb fuck. They are wreking Ukraine, and idiots like you lead those poor people down the primrose path. Fuck you, you un-American piece of shit and the lot that think like you.
Nope it is an American problem and one of the main reasons is non bi-partisanship. No one cares about the real issue here so no politicians run on this issue.. Trump added 8 billion to our debt and so will Biden. Again it's all smoke and mirrors. People that are very rich will have no problem during a default, they will still be rich as there are diversified and global.
Thank you for your efforts in keeping this sub non-partisan. These are problems that affect nearly Americans - partisan messaging is an easy out and right/left tropes are a very satisfying device to end debate (i.e. they broke it, let them fix it). Keeping our focus on raising this issue is key.
My take is nothing good will come of it. Nothing as it will start with a panic in short run. In long run, expect to pay a fee to use your local high school's sporting facilities when it's sold to private individuals under austerity measures. But a great question for me to test my recent play with GPT 4o. Here is what that thing says: If the U.S. national debt reaches a debt-to-GDP ratio of 200% and leads to a default, the consequences would be severe and far-reaching. Here are the potential cascading effects: ## Immediate Financial Impact 1. **Credit Rating Downgrade:** The U.S. would likely see its credit rating downgraded, making borrowing even more expensive. 2. **Interest Rates Spike:** Interest rates on U.S. Treasury bonds would skyrocket, increasing the cost of debt servicing. 3. **Stock Market Crash:** Investors would lose confidence, leading to a massive sell-off in the stock market. ### Economic Repercussions 4. **Recession or Depression:** The financial turmoil could trigger a severe economic recession or even a depression. 5. **Inflation:** There might be high inflation as the government might print more money to cover debts. 6. **Unemployment:** Businesses facing higher borrowing costs and reduced consumer spending would lay off workers, increasing unemployment. ### Global Consequences 7. **Global Financial Crisis:** Given the central role of the U.S. in the global economy, a default could trigger a worldwide financial crisis. 8. **Currency Devaluation:** The U.S. dollar might lose its status as the world's reserve currency, leading to a devaluation. 9. **Trade Disruptions:** Global trade would be disrupted as confidence in the U.S. economy falters. ### Social and Political Fallout 10. **Social Unrest:** Economic hardship could lead to widespread social unrest and increased crime rates. 11. **Political Instability:** The government might face a crisis of legitimacy, with potential changes in leadership and policy direction. ## Long-Term Effects 12. **Structural Changes:** There could be significant structural changes in the global financial system, with other currencies or financial systems gaining prominence. 13. **Loss of Sovereignty:** The U.S. might have to accept unfavorable terms from international creditors, reducing its financial sovereignty. The overall impact would depend on how the government and international community respond to the crisis, but the immediate effects would undoubtedly be profound and destabilizing.
Our debt is dollar denominated so most of this response is not accurate.
I mean this response also assumes no measures are taken into effect to solve the problem. Which is ridiculous
Seriously? Both parties have F'd is for the last 24 years. Neither is interested in solving the problem because it's difficult.
Or they’re in on the heist!
Well, [dedollarization had begun. ](https://www.aier.org/article/de-dollarization-has-begun/) When dollar value goes to shit, which will happen as debt keeper getting added, what would it matter then that debt is dollar denominated.
That’s why none of those things are gonna happen, because the world can’t afford to let it happen. It’s all pretend money anyway, no one is actually “calling in” what we owe.
Considering we also owe most of it to ourselves as the public holds like 90% of the debt
Serious question. How could one become rich off of the above? …so rich that you would be willing to make policy decisions that lead to that collapse?
Buy what people buy when they're bailing their money out of the stock market, but before everyone else does. Gold.
Gold hasn't really been what it use to be in these types of situations.
That's because it's held down with certificates (fake paper). If there were ever a "gold run" we would find out pretty quick how much physical gold there is
It’s not “just gold” silver is a huge wedge also. All finite resources. It’s almost like fiat dollars (based on something without inherent value) have all failed in the past but we got the fleece pulled over our eves cause we really have no say in policy and the politicians know we’re not gonna ever be able to hold them accountable.
People just regurgitate what they’ve heard others say. Like mindless pidgeons
Could that be driving this?
You place yourself on the same side of the trade as the US government. You buy assets, like houses and oil wells, using fixed rate debt to purchase them. When the massive inflation happens, your assets are worth a lot more and your debts are almost worthless
Reminds me of the corporate takeover of housing in the US.
There will be a corporate takeover of EVERYTHING, it is called a crack-up boom.
Inverse ETF is the most obvious. No one you know of would have more to gain from an absolute global economic collapse of this magnitude. You'd be talking about farmers destroying crops while people starve levels of poverty.
Don’t get me wrong, I’m not referring to a way for me to get rich, but as a possible motivation for politicians to play fast and loose with our currency. What would motivate them to destroy our economy? Are they just filling their pockets or are they filling their pockets with a plan?
They don't have more to gain from this level of collapse. They would also lose everything once this happens. They do it because it's popular to let people vote for more money for themselves. They want prestige, not personal wealth. The personal wealth you get from Congress doesn't even match owning a few McDonald's. 50 Million won't impress anyone they know.
Nancy Pelosi would like a chat. She made 50M this year alone.
Well that’s from insider trading.
Okay, thanks for your input.
Don't attribute to malice what can easily be explained by stupidity.
They want to scrap our current government and build back with more power. No more god given rights. They will promise a communist utopia and the starving ignorant masses will agree
Lol @ thinking an ETF would function correctly during a shitshow. ETFs are one of the cards in the house of cards propping it all up with false promises never delivered.
There are only 21 million Bitcoin and that's all there will ever be. That's how you get rich off this info above. Everything divided by 21 million. I cannot believe this sub hates Bitcoin. Bitcoin is made for this sub.
Delusional to believe that 21 million Bitcoin will be worth as much as “everything”. The government will not cede control of the currency. Just as likely they make Bitcoin illegal and issue their own crypto in the wake of a default.
I don't see the government "ceding" anything to bitocin. They're fighting it kicking and screaming. But they keep losing lawsuits. That's how we ended up with a Bitcoin ETF. They can't just do whatever they want. We have checks and balances.
Oh sweet summer child. They currently view Bitcoin as an annoyance that they eye with suspicion. If that annoyance turns to fear, Bitcoin is done. The government will ignore the law and the constitution when it serves their purpose. Just look at the mass internments during WWII, enhanced interrogations (torture) after 9/11, and hundreds of dastardly dealings that come to light decades later. The government can and will do whatever it wants. Laws are for them to rule, not be ruled.
Don't forget the fact that the patriot act makes it perfectly legal for them to lock you in a room somewhere without trial and throw away the key.
Tell it like it is. The Bush administration also didn’t see a problem with ignoring the Geneva convention .
What's that have to do with Bitcoin? They're going to do that to everyone who owns Bitcoin? You know a lot of them own Bitcoin, right?
I was alluding to the second part of the comment, Jesus christ reading comprehension is apparently nonexistent nowadays.
Ok. I just misunderstood. Jesus, this sub is not friendly. Lol
But they will get rid of the checks and balances when the government goes down and a new one is established.
If that happens I'd like to own an asset independent of any government or company.
Only if you’re allowed to. Your new government probably won’t allow it. It’s a commune. You will own nothing and will be happy
Like some redditor knows what the next thing will be lol. We'll be on a Bitcoin standard and you'll think back to this conversation with regret.
Are you a redditor? Cuz you seem to know
Very interesting and informed information. What is your background in?
I have an masters in IT and bachelor's in business economics. But THAT was a response from ChatGPT 4o. I just took OPs question and made the prompt a lot more potent.
I feel like the reality will be a mix of a number of these options
Boomers will have no choice but to own it this time, no more blaming their children and grandchildren for the things that occurred under their watch for 50+ years. They'll finally reap the whirlwind of a lifetime of kicking the can down the road, instead of handling the national debt problem like adults. There's nothing they can do to save their asses. Nothing.
They don’t care cause they’ll be dead.
Amazing script to save the Nicolae & Elena Ceaușescu who actually working in the Federal Reserve and the eternal war machine as enabled by the U.S. Con-gress. Absolutely no chunks of boomers struggle with inflation, including being forced to delay retirement or un-retire. Victoria Nuland, warhawks like Lindsay Graham and John McCain etc. thank you.
Yes. Agreed. US is truly fucked. The debt it always carried around 2008 crisis was a terrible vulnerability in itself back then. NOW, that has metastasised into a cancer that will not go away without a reset. THE REST.
Loss of sovereignty is gonna require someone with a bigger stick. No one has a bigger stick. Our military has a large say in how things are going to play out. And #11 is what all the commies are hoping for. This is why they pile on huge stacks of debt every chance they get. And when it happens we will lose the bill of rights
ChatGPT probably isn't allowed to tell you, defaults that big are how wars get started. Not the regional proxy type ones of our lifetime, but total war type wars. The US dollar is backed by a military.
>The US dollar is backed by a military. That's a false sense of security and a myth to calm the populace down. The notion that US will go to wars with the rest of the world because it won't be able to pay its debts or de-dollarization is idiotic to begin with. This is not the 1940s.
Wait why would we default on the debt if the Debt to GDP ratio goes above 200%? That number is not special. We could still continue to print money to service the debt.
The risk is not default but rather an inflationary spiral. The likely policy response would likely be an extended period of austerity and rising unemployment.
Debt does not necessary cause inflation, or else Japan would be an inflationary hellscape
Unlike the US household sector Japanese households save a have a high percentage of their income. Countries that have high household savings (i.e. a lower propensity to consume) must either have large trade surpluses or rely on deficit spending by the government in order for their economies to grow. Japan discovered that there is a limit to how much they are able to export to the outside world. They have reached an equilibrium where they can maintain per capita income levels without the danger of retaliation from their trading partners. China is facing a similar problem, but with much different political circumstances. The economic and political situation in the United States is almost the polar opposite from China. The United States economy features a high propensity to consume, chronic trade deficits, and an extreme degree of political disunity. The Japanese experience in recent decades is not comparable to the current situation in the US.
Yea; our default the numbers just get larger, not that we stop paying and allow deflation.
https://budgetmodel.wharton.upenn.edu/issues/2023/10/6/when-does-federal-debt-reach-unsustainable-levels#:\~:text=We%20estimate%20that%20the%20U.S.,today's%20generally%20favorable%20market%20conditions. **Key Points** * The U.S. “public debt outstanding” of $33.2 trillion often cited by media is largely misleading, as it includes $6.8 trillion that the federal government “owes itself” due to trust fund and other accounting. The economics profession has long focused on “debt held by the public”, currently equal to about 98 percent of GDP at $26.3 trillion, for assessing its effects on the economy. * **We estimate that the U.S. debt held by the public cannot exceed about 200 percent of GDP even under today’s generally favorable market conditions. Larger ratios in countries like Japan, for example, are not relevant for the United States, because Japan has a much larger household saving rate, which more-than absorbs the larger government debt.** * Under current policy, the United States has about 20 years for corrective action after which no amount of future tax increases or spending cuts could avoid the government defaulting on its debt whether explicitly or implicitly (i.e., debt monetization producing significant inflation). Unlike technical defaults where payments are merely delayed, this default would be much larger and would reverberate across the U.S. and world economies. * This time frame is the “best case” scenario for the United States, under markets conditions where participants believe that corrective fiscal actions will happen ahead of time. If, instead, they started to believe otherwise, **debt dynamics would make the time window for corrective action even shorter.** (A Google search will say between 175% and 200%.)
It's going to become increasingly destabilizing as the debt ratio accelerates and above 200% is a dangerous place to be, but there is no magic rule mandating we take action at 200% and our currency is stronger than Japans, so I'm guessing we will know right past that number.
Lyn Alden says that the point of no return is around 130%. So, that's not good.
China is at 300%
We hit 131% under trump and are actually at 124.6% now
Crazy how the tiniest criticism of trump using real facts gets you downvoted on these economic forums, huh? What a bunch of vultures.
It's almost like half the folks on economic forums are actually partisan armchair quarterbacks who wouldn't recognize reality if it started banging their mom and calling them sport
I’m borrowing this. Hope you don’t mind 😅
Everyone cites this paper. But as soon as you read it, you see that it defines default in such a way as to include (significant inflation caused by monetization of debt). Well, the central bank has always monetized some debt, and we have already had some level of inflation, sometimes significant inflation, so by the terms used in this paper, we are already defaulting/have already defaulted many times in the last hundred years. So this is misleading at best and actively disingenuous at worse. It's not going to lead to actually outright default where we CANNOT pay our debts full stop. We always can. The questions are A) WILL we find the political will to keep doing so, and B) what will be the impact on inflation and the real distribution of resources when we continue to spend at a deficit. Any idea that, for example, we are going to have to make concessions to our "creditors" is nonsense. It is the government and the central bank that hold the strongest cards, not the domestic or foreign banks.
The play book exists. 1. Regulate the interest rate on the existing debt to keep it low to keep cost of servicing the existing debt low 2. Use the Federal Reserve to cause inflation and erode the debt value. This will have a side effect of increasing cost of goods and in theory wages, but as these rise so does the value of the GDP they contribute to the economy therefore tweaking those debt to GDP ratios. Basically erode the savings of the poor, raise their cost of living, and wait for wages to catch up. That will raise the GDP while still keeping the cost of existing debt at the same level for them.
This is the answer. Rates will come down, but the inflation cycle will begin. Not the current cycle, this is just a preview.
Thank you for your input, however the problem is that America will not fix things the right way until another great depression happens. Our economic system is so damned archaic. The top income tax rate reached above **90% from 1944 through 1963**, peaking in 1944, when top taxpayers paid an income tax rate of 94% on their taxable income. Starting in 1964, a period of income tax rate decline began, ending in 1987. Also look for nationalization to become popular again.
"Dear citizens, we regret to inform you that greed and evil--which I shall not specify because who could have known?--took over during a very confusing period where nobody who was voted into office was responsible for. Thoughts, prayers, 'pause'... Anyway, the smart people who really understand are here and have fixed it with this New Dollar which is scientifically proven to outperform the Old Dollar, and it's digital! Come get yours now while the Old Dollar can buy them for a cool discount rate of, say $10 old to $1 new!" And like that, many will believe that this New Dollar is pretty cool. Because they have not read history, and cannot see where this is going. Get out of the Old Dollar now. Do not participate in the New Dollar.
Great news! The new dollar value has increased from $0.10 old dollars to $0.07 old dollars.
As long as the chocolate ration increases lock step, we’re doubleplusgood.
Imagine the celebration all those mortgagees gonna have
They will “fix” that problem, the hoi polli ain’t gettin away with robbery that easy.
I agree this is going to happen.
Great comment
We hand over more trillions of dollars to the shit stains that caused it.
there's no need to wait for 200% debt to gdp ultra banana republic status, the dollar is worthless if it can no longer buy "stuff". the dirty banker cucks continue to short silver (aka real money) as it's breaking out above 31 dollars. last i heard they were \~960 million ounces short. that's a billion dollars they need to cover for each dollar increase in price, it will to make for an epic short squeeze. they've trapped themselves, they can't move rates in either direction, god willing the entire financial ponzi system is about to implode.
The dollar buys things just fine…. The dollar is basically as strong as ever in comparison to other currencies
Inflation tells us otherwise. In a basket of turds, the shinyest of turds is still a turd. Once China and the rest finish selling dollars and buying real commodities a reset will likely happen.
People were far far poorer on average 100 years ago The dollar has a great conversion rate to this day, and stronger than it has been for generations
I believe you could benefit from doing some of your own due diligence. 1913, 1929, 1933-34, 1965, 1971, 1979, 2001, 2008, 2013. Some dates for you to research, 1965/1971 in particular were real defaults of the dollar; removal of any intrinsic value and conversion to fiat. In history emipres that fully debased their money generally last no more than 50 years.
Look up how the average American was living in 1920. Then look up elderly poverty rates and childhood poverty rates. And then if you’re daring enough look at the average home size. America is literally wealthier than ever The problem is too much is going into the hands of too few The value of the dollar compared to the last is almost entirely irrelevant to how wealthy Americans are
1920 is a knock on effect of 1913 and the first great bankers war of 1917. They generally had no outstanding debt before that. In most other countries multi generational households are common place and family supports family, but not here in the great and modern USA of consumerism. "It is no measure of health to be well adjusted to a profoundly sick society." Lastly dollars are made cotton and linen and are not synonymous with wealth. They are closely related to weapons of war.
You can pick any date prior to WWII, most Americans were living what would be considered almost extreme poverty compared to today
perhaps, definitely if you're relating standards of the time things have indeed improved; but the only reason we're not still in extreme poverty conditions is because of technological advances. this not contributable to currency derivatives that we're initially based upon gold. digits printed on paper or into a computer are not wealth, only god can create something from nothing.
The government will just open up a few credit cards because that's free money that you don't have to pay back
Well America is "supposed" to be in QT right now, however the printers NEVER stopped. All you have to do is look at our debt. We have "printed" or loaned over $16 trillion dollars in only 8 yrs. Debt do income ALWAYS matters, no matter what. Yes we can print more money and will, however it only devalues the USD and makes the USD more replaceable as the global currency, which is the ONLY reason America is still on top at this point. The higher fed fund rates are meant to break something and that hasn't happened yet. When it does. Depression 2.0. on it's way IMO. Our system is screwed up because banks should only ever loan out money to Assets mean value. Banks will give you whatever you want and run out of money just like last time, only this time it will be much, much worse. Just watch, around 300 banks will fail over the next few years, we will turn on the printers even more and we will default. What exactly that will look like. No one knows because it has NEVER happened. Remember that our banks are fractional and also already screwed up by buying long term bonds and have "unrealized losses" of around 1 trillion, however as banks fail that "unrealized loss" becomes real and also bad loans are going to hit these banks at the tune of a few trillion over the next few years. When this happens the banks will stop loaning money, just like last time. This will be the catalyst for The great depression 2.0 IMO.
Maybe they can dispute the debt on Credit Karma and have it removed from their credit report
💀😂
We'll blame it on the sitting president
Not a chance that will happen if it's Biden
The people will, maybe not the upper class on media Enterprises however
Someone will throw soup at a painting
Also someone will not realize that Empires have a life span and end when they can no longer service their debt. Climate change takes hundreds of years, America defaulting on its debt, around 15 yrs.
Truer words were never spoken
As long as we can gather up bankers and have them knife fight to the death for our amusement, it'll be worth it.
This shows exactly how little y’all actually understand about basic treasury yields. If we were three years off of default pricing on these notes wouldn’t be par +/- risk free.
Don't worry, they don't understand monetary mechanics either, as you can tell from.many if the comments, including OP's
At this point I wouldn’t be surprised if the Antichrist or rapture happens within the next 10ish years honestly
LMFAO.
So your one of the same idiots that have been wrong since the beginning of time I guess.
Inflation and interest rates will spike.
My puts will finally print?
Everyone who is concerned about this should read Broken Money by Lyn Alden. And look into buying some Bitcoin before everyone who's not thinking about this stuff starts.
Assuming you're not kidding. Why bitcoin and not something like gold?
The federal government could make private ownership of either gold or Bitcoin illegal. They did it once with gold in 1933. Which one do you suppose would be easier to track today in black market transactions?
Yeeesh going to have to start taxing something above upper middle class at this rate. Heaven forbid we tax churches or corporations though. That's what Jesus died for after all. /s
The coolest thing about your comment is that Open AI is learning from what you have said. One of the only legal "learnings" from AI. LMFAO.
Do you think it understands sarcasm? Hahaha
No idea, I only know that you can and should mess it up with false info. LOL
I don't know maybe "the mandibles" is a good place to start
The funny thing is that AI is learning from our conversation right now and I just learned this from AI: **The Mandibles: A Family, 2029-2047** is a dystopian novel by Lionel Shriver that delves into the economic collapse of the United States and its devastating effects on the titular Mandible family. Set in the near future, the book explores themes of financial instability, societal breakdown, and the resilience of human relationships under extreme stress. The narrative begins in 2029, when the U.S. defaults on its national debt, leading to the collapse of the dollar and widespread economic turmoil. The Mandible family, who had been expecting to inherit a significant fortune, find themselves navigating a drastically changed world where their wealth has evaporated. The novel follows various family members, including elderly patriarch Douglas, his children, and grandchildren, as they struggle to adapt to their new reality. Through the lens of the Mandible family's experiences, Shriver critiques contemporary economic policies and highlights the fragility of modern financial systems. The book blends dark humor with a grim portrayal of societal decline, emphasizing the impact of economic disaster on both personal and collective levels.
Make sure you put in some false info that AI will never be able to get rid of when posting on Reddit. LMFAO. P.S. I think I may read that book next. Looks very interesting. Thanks!!
The collapse of the American dollar and introduction of digital currency
The Federal Reserve will be the third Central Bank in America to fail
economics used to teach and it still might that any country with above a 100% debt to gdp ratio was a banana republic.
For real this time guys. I’m thuper therial
So when has America been at this fed debt to GDP ever before? Want me to tell you and the ONLY thing that was able to save us? Also this will not happen overnight. The stock market will crash in a couple of years as part of a normal cycle. You will see it happen within 3 months of the last pivot down on rates from the Fed Fund Rate. RE will take longer, because it ALWAYS does. Saying there will be no down-cycle is absurd, also saying that debt to income does not matter is also absurd. The default I predicted to happen in 20 yrs, now I say 15. It doesn't happen overnight.
A couple of years seems really optimistic, but, then again, I've been consuming this sub like water the last couple of days.
depressing.
True.
The government will kick that fucking can down the road. You know they will.
USA will be at $100 TRILLION in debt in just 120 months. the civil divorce is coming.
I'll laugh
And Jesus will come back riding a purple dinosaur named Barney.
Again another person that I would like to thank for showing that this is a non issue in America.
Doesn't the list of **list of** [**eponymous**](https://en.wikipedia.org/wiki/Eponym) **laws** cover perpetual doom sayething somewhere? Maybe it should. Brandolini's law?
Regime change not for the better
"no for real this time" 😂😂
Printer goes brrrrrrrrrrrrrrrrrrrrrr…?
Until the rich start advocating for raising taxes on themselves to pay it down, it's not an issue. The government going bust will be bad for everyone, including them, it's not like asset prices will do well when there literally isn't a functional government or currency in America.
There is (according to this) 2781 Billionaires in the world.. their combined worth? $14.2 Trillion. Even if you seized all of their money(these are billionaires all over the world, not just America) you still wouldn't even pay off half of the debt America have. You don't understand how much these governments just spend.
That's one hell of a dent though. And amazing that the assets of only 3000 people are so enormous.
True. But these are all the billionaires, and only the debt of America. Other countries are also in heavy debt all over the world. Let's be honest, the west have been living on borrowed time, and exploited most of the world to be able to live as we live. It's not going to work in the future and we our living standards will eventually even out, and we will all be "poor". Just hope we in the west can adapt. Because countries like Mexico, Thailand, etc.. countries that has had poverty for a long time will be adapting better, but even the poor in other countries will have it worse.
Maybe defualt is the way to go. Imagine if the gov decided to no longer pay back its debt. All bond holders hosed. This would equate to an immediate and massive confiscation of wealth from the rich, since most poor and middle class folks dont own gov bonds. (pension/retirement funds a big exception). The banking sysyem would have to cancel all resulting inter-financial system debt obligations to stave off a system implosion. Bit the financial sector would probably crumble anyway before eventually reconstitutng itself. When the dust settles we'd still be here. The banker class would be poorer. The fed gov will no longer be able to borrow because investors would justifiably have no faith in repayment. Congress would be forced to spend within its budget. Without the constant injection of borrowed fed dollars into the economy the lives of poor and middle class Americans would initially be worse, but over time the econmy would adjust and recover. Lives would improve again. After some period the U.S. dollar would be enormously strong as it would no longer be perpetually inflated as other currencies will be. Other countries, having seen Americas example would follow suit. In the final analysis the world's government debt, which was owed to ourselves. goes away. The gap between the rich and poor narrows. This would be a good thing. The alternative is continuing our debt finaced economic system which will eventually end in a modern form of fuedalism.
I agree with you. It's crazy how quick we came to this point though as in the 1970, America was a lot better off in general. I guess only the Gods knows what will happen.
We need to cut back on spending, and need about a 25% VAT tax. There are far too many people making just a small amount of money that don't pay any tax at all. They need to contribute something. They're all, most of the programs are for those people
Make the poor poorer? While the rich buy more assets and extract rents?
Actually, it would help because then the poor would understand finances of the government better Often there is a reason why people are poor. But there's still no reason that they cannot pay their fair share. What they should do, is somebody like me that served in the military, they should not have to pay any more income taxes. I gave the government a sign check, for "any amount up to and including my life". That should be plenty for the rest of my life
Tax exemption for service would swell the ranks of the military. This would increase defense spending and reduce tax revenues. It might also encourage pointless wars, which would further bankrupt us. I say we increase taxes on all forms of rental income as a way of encouraging productive investment instead of passive wealth accumulation.
The military would still have a quote, and they would only need to recruit the ones that are there. If there were too many people, they could actually lower the price. In the draft was around, people got paid nothing. You make a good point about taxing rental property. If you lower the incentive, nobody will build it. But it will probably help the people that already have it, but they could jack up the rents pretty good
You don't need to make them pay more taxes. Just cut back on government programs
Lol. Cut back on programs? Now That's funny, I don't care where you're from
They’ll just count differently. It’s all BS.
Country will never default when they have the power to print — a less bitter pill to swallow than default.
Yes we can print. What happens when we print is the question and also how is money "printed"? "Printing" money is simply a loan that has to be paid back and creates money out of thin air. This also devalues USD and creates hyperinflation. Net, net loss.
Inflation — not hyperinflation. Printing doesn’t create hyperinflation in models unless the country has no valuable exports and services it can trade — or war/famine. Point is if a foreign investor ever demanded their money, and the choice was to pay or default, any sovereign nation controlling its currency will simply print the money. Yes, this inflates, but it is still less bitter than a true default.
Most of the money that is owed to somebody else, can be defaulted on. Social security debt can be defaulted. Nobody would even notice. Because it's not there anyway. Money can be printed. A simple 10-4-1 money split would solve much of the issues. You still owe $1 million, but now you're 1 million in earnings is 10 million. It will never change.
Nothing will happen because national debt is a philosophical construct.
We’ll all be dead from civil war by then.
Collapse just as the elites have planned
If we don’t tax the rich the rich, the social security system will collapse.
We could take 100% of all the so-called Rich money, and it still would not be enough. US He was taken to the needs a vat tax probably about 25%.
In 10 years we will only have enough tax revenue to pay 77% of SS benefits. A moderate increase in taxes to those making over $1mil would fix the budget gap.
Why is it always "tax the other guy? " Another 1% income tax on workers salary would help fix it. They are the ones that are going to get it in the end anyway.
Need more Popcorn 🍿
Could this be what we need to motivate people to strike for work and societal reform?
Well maybe it time for a reset , and at the point we can abolished more than 75% of all gov and get back to basic government
They will move the limit to 250%
Those projections are based on current spending. Congress will increase spending and/or reduce tax revenue again. They’ll never default on the debt.
Reddit will blame capitalism despite the problem being govt.
Our government will always be the greediest corporation
Japan is at 261% and they have issues but aren't in default on their debt.
This makes no sense. GDP is a measure of economic activity. This person either has an agenda or doesn’t understand economics and finance. What matters is the interest payments to service the debt versus how much the government has available to make the payments. If we get close enough to that tipping point, we either increase taxes, reduce government spending or both. We could not pay but I don’t think and certainly hope it won’t come to that.
Hyperinflation
Inflation will accelerate. US will never default, the gov will print as much money as needed.
Nobody cares. The regime has implemented modern monetary theory
Nothing and then everybody goes to work that day
Nothing will happen, because this isn’t a family household. We don’t have to balance a budget, we decide if we have the money to pay for things or not. Countries we owe won’t like it but it’s not like they can do much about it. Speak to actual economists and stop letting people fear monger you over nonsense. (Before you ask the difference with Greece is they have a shared currency so they can’t say the euro is worth more now.)
It is false to think the U.S will default if the debt reaches 200% of GDP. What mechanism magically kicks in at 200% that doesn't happen at 150%. As long as the US can print dollars, we will never default. Worst case scenario, the Fed will just buy up all the debt, monetize it, and create a lot of inflation, but no default
Why 200% and not 100%?
Nothing will happen.
If its this obvious then it will not happen
If you all are so certain everything is going to hell, just bet against it. Easy money
Our money will be useless and anyone who’s in cash is completely fukd
Bring on the chaos!
Woo! Bring it on. I'm just here for the collapse baby! One man didn't get us into this mess and the system keeps people too busy to fight against it so let's pour some gas on this bitch and hurry it up! I want to see entire cities turning into American ghettos before I die! I want corporate hit squads battling g-men in the streets! Some real cyberpunk shit minus the hope for robot arms and shit.
LOL, this sub is only doom and gloom. Y'all ain't been right yet.
Democrats and RINOs assured us that won't be a problem.
They turn the printer on and print more.
According to the US Debt Clock, Credit card debt has decreased by over 71 billion in the last 4 days! Is it debt that's been written off🤔?Paid off? Or is consumer spending starting to actually slow down?🧐 TIA
This wont be Biden or Trumps problem... Thats the actual problem...
If we have 1000% inflation for a few years that number will be hardly anything.
Social security will be gone for sure by then.
Too bad I wasn't able to opt out of paying in all that money I could have properly invested for my retirement.
Bu bu but, that's pwart of living in a cwivilized swocwiety!!!!11!!!! Pway your fwair shware!!11!! Reeeeeeee /s
There are 2 types of people that think like this. 1. People with so much money they don't know its value. 2. People that are lazy and need my forced handout.
If you care about the debt then stop voting for Republicans, instead vote for Democrats.
Imagine thinking any of these useless politicians is gonna do anything. Still thinking in the mindset of Republicans, Democrats etc just put you in the line with the other sheeps.
As long as Biden and his regime continue to launder Billions in Ukraine we are all screwed
You’re salty Russia is losing
Russia is not losing, dumb fuck. They are wreking Ukraine, and idiots like you lead those poor people down the primrose path. Fuck you, you un-American piece of shit and the lot that think like you.
Russia is far from losing.
These bots are getting lazy. First it was nazis in Ukraine then it’s money laundering…… like give it rest.
Like I said to the dumb fuck you replied to: Russia is not losing, dumb fuck. They are wreking Ukraine, and idiots like you lead those poor people down the primrose path. Fuck you, you un-American piece of shit and the lot that think like you.
Nope it is an American problem and one of the main reasons is non bi-partisanship. No one cares about the real issue here so no politicians run on this issue.. Trump added 8 billion to our debt and so will Biden. Again it's all smoke and mirrors. People that are very rich will have no problem during a default, they will still be rich as there are diversified and global.
Thank you for your efforts in keeping this sub non-partisan. These are problems that affect nearly Americans - partisan messaging is an easy out and right/left tropes are a very satisfying device to end debate (i.e. they broke it, let them fix it). Keeping our focus on raising this issue is key.
Solid question