Economics of Government Debt

the notion that the US will never default on its debts is a foundation of the global economy, US treasury bonds are considered to be a risk-free investment.

That's one of the big reasons why so many economists hate Trump, he suggested America should negotiate with its creditors to pay back its debts for pennies on the dollar. This is something that is often done with debts in business when declaring bankruptcy, but doing so on US bonds would mean a default on loans and would absolutely destroy the global economy. It was very worrying to many economists because it showed a lack of understanding beyond his narrow experience in the business world.

>>1897123
I still don't understand why so many Americans believe success in business can be transferred to success in government. But it's pretty clear at this point Trump will just be a puppet for Pence the same way Dubya was for Cheney.

>>1897112
National debt is only bad when other people think you can't pay it back and stop giving you more loans.

>>1897112
I don't understand, your cartoon can you maybe add more labels?

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>>1897455

>>1897455
>>1897464
Please don't derail my thread, thanks. I just got the image of google.

Basically the government sells its national sovereignty away to a handful of international Jewish banking dynasties, who live like gods off of ever-increasing interest payments collected from the gentiles' taxes. There isn't enough wealth in the entire world to ever actually pay off the principle. The central banking system is essentially selling all future generations into eternal slavery to the Jews. If we ever fail to make an interest payment, the Jews will downgrade the government's credit rating, making it impossible to borrow money, causing government collapse. The state will no longer be able to feed the dusky welfare leaches the Jews have imported by the millions, who will then riot and kill everyone, destroying society. Usury has destroyed Western civilization.

>>1897512
Three substantive posts before /pol/ arrives. Are you guys just invading /his/ for the luls right now, or is this board just extra containment now?

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>>1897112

Its like 300 billion dollars a year down the drain sacrificed to Jewish elites... not a big deal i guess?

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>>1897885

>>1897879
/pol/ is the most popular board on 4chan. You're the same as the people who used to complain about racism leaking out of /b/.

Why are you even here if you don't like 4chan?

>>1897891
>/pol/ is the most popular board
Citation needed.

>>1897902
https://catalog.neet.tv/stats.html

>>1897891
I forgot that liking 4chan means wanting stormfags to show up and derail literally every thread.

>>1897891
FUCK YOU RACIST I CAME HERE FROM REDDIT IN 2012 AND 4CHAN HAS BEEN RUINED BY RACISM FUCK YOU RACIST PIECE OF SHIT I USED TO LOVE THIS PLACE BEFORE IT BECAME SO FUCKING BIGOTED

fuck this maybe i should just go backto reddit where they can moderate this shit and delete this awful hate speech

>>1897905
>no /b/
Okay.

>>1897112

Debt has crushed nations in the past yeah. The Weimar republic of interwar Germany actually had a period known as the golden years when it was economically booming thanks to massive loans from the US to rebuild it's economy, for the purpose of making them be able to pay back their debts in the future (the irony was clearly lost on them). Then the great depression happened and the US wasn't able to essentially subsidise Germany's debt anymore, prompting the infamous hyperinflation and political turmoil that lead to the rise of the Nazis.

There aren't really any examples of debt destroying a modern nation, because an economically destroyed nation can't pay back its debts - a good example of this would be Argentina right now, who are negotiating with vulture funds and international debtors so that they still pay back some of the debt they owe instead of wiping it all clean with bankruptcy.

TL;DR no one wants a repeat of Weimar Germany so the odds of a nation actually defaulting on debt are very low.

>>1897922
/b/ is a shadow of it's former self that hasn't been in the news or created a new meme or in like 2 years.

>>1897930

Theres still billions of dollars going to kikes in interest payments...

>>1897916
No one is complaining about racism. you really can't see the disanalogy? There are like 10 posts on /his/ right now that are 100% "why are Jews the worst." This is just /b/ tier and is basically killing this board.

>>1897931
Is that opinion of yours supposed to be evidence of something?

>>1897930
>Then the great depression happened and the US wasn't able to essentially subsidise Germany's debt anymore, prompting the infamous hyperinflation and political turmoil that lead to the rise of the Nazis.
the infamous hyperinflation was a thing of the early 20s, not a result of the great depression

>>1897946
Just saying. The population of /b/ has probably gone down a ton. Sometimes i barely remember it exists.

No edgy teenager wants to hang out in some fap roulette thread after school and edgy teens were the lifeblood of /b/. That's why they all left to /pol/ where they can make people butthurt on twitter.

The world economy would implode if the US defaults on its debt. Nobody wants that to happen so it's allowed to keep borrowing.

>>1897971

No it wouldnt. Major debt crises have happened in the past and nothing interesting came of it.

>>1897891
/b/ and /v/ are still bigger, and /pol/ has only an increased interest due to the elections.

Nobody likes you fucks because your posts tend to be of low quality and off-topic.

>>1897983
/pol/ has overtaken /v/ in population.

>>1897983
I never bring up politics unless someone else does first.

>>1897992
I don't think so, but I'd have to run my script for a few days to get the most updated and accurate information on the numbers. Then again, as I said previously, the numbers are heavily skewed due to the elections.

>>1897123
An economy that rests on artificially low interest rates is bound to crash anyway, might as well renegociate the terms of your debt.

>>1897992
But will it last after the elections are over?

>>1897971
It would slowdown for awhile but I don't think it would implode.

>>1897123
>US treasury bonds are considered to be a risk-free investment.
[Citation needed]

If this was true then our bond yields would be far far lower

>>1898416
They are extremely low.

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>>1897112
It was a pretty big deal to certain joyous sea merchants.

>>1897891
You're out of your fucking mind if you think people dislikes /pol/ because they are racists. People hates them because their off-topic nature.

For the average dude, Government debt mostly ties in with loan rate. There is only so much money to be given out on loan. The Government gets preferential treatment in getting loans first. The US government usually pays mature loans by taking out more and more loans. Since a larger portion of the loan-able money pie is taken up by the goverment, the creditors will up the the interest rate on the loan for everyone else looking to take out a loan. Mind you this is what I learned from AP macro like 3 years ago so I can't remember if thats all.

>>1898431
That's not an argument

bumping for interest

>>1897112
A lot of people in this thread have explained the relative unimportance of national debt in the economy, but nobody seems to have covered quantitative easing, so I'll take a stab at it.

The Fed playing around with the interest rate does lead to inflation, and quantitative easing is just a more extreme way of playing with the interest rate because the alternative in 2008 was to go negative, which some European countries did. The Fed knows this causes inflation, but keeping the economy afloat is more important right now. That's why the Fed has considered raising interest rates, but ultimately doesn't. If the US raises rates, it could tank economies everywhere else in the world, because other countries haven't recovered so quickly.

>>1897112
It depends on if you're part of the EU or not.

>>1897129
Trump businesses aren't that successful. Trump just structures his businesses so he personally profits even if they fail.

Not too much of a deal at all.

If we refuse to pay back a debt, we won't be able to get any more debt from other countries. But our bonds are hot buys atm, and no reason not to sell them so long as our gdp growth is higher than our trade defecit + asset depreciation.

>>1897979
>2008 wasn't interesting

I mean, I guess it's just your opinion.

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>>1901481

That had nothing to do with finance. Just resource depletion.

>>1897123
I will never understand why so many non-bankers and non-hedge fund managers are so insistent on upholding our current system. You don't gain anything from our system.

>>1901685
Quality of life will go down for the next decade or so if the system collapses and the Jews flee with their capital to their safe havens.

>young people
>i need the economy not to collapse so i can get a job
>middle aged people
>i need the economy not to collapse so i can raise my kids
>old people
>i need the economy not to collapse so i can live out my retirement comfortably