No, I'm not kidding. You need to read "Blood in the Streets". http://www.amazon.com/Blood-Streets-J...

An example they cite is Cuba. The traditional way to deal with nations that repudiate their debts is to cut off trade. So after Castro reneged on the debt run up by Batista's government, the US declared a trade embargo. But it completely fizzled, because every other country was still eager to trade, and quite a few continued to lend money to Cuba. (Their economy did go to hell because of Communism, and because Castro outlawed the gambling industry which was their main revenue source. But the US boycott had next to no effect.)

I don't expect an explicit default, anyway. I just expect the US to pay off the debt with printed money, which they're already doing and have been doing since 2008.

"Nothing much will change..."
Your kidding, right? It's one thing to know that our money is a politician's plaything - it's quite another to be told your treasury bills are now worthless.

You do know that t-bills are the foundation of every large investment portfolio, right? They are THE go-to investment for preservation of capital.

As for printing $18,000,000,000.00 - well, what kind of harm could come from that? I mean, who knows?

Oh yeah, that's right, it's been tried before. Well, maybe not THAT much money but still...
It HAS been tried MANY times before. By pretty much every failed-nation-state.

Not to get mean or rude JD but, damn buddy, you bandy money like a socialist for Christ sake.

Not really a big deal, given the small amount of money. Lower crude prices have been hammering Russia.

Unfortunately, a default would harm even those who didn't explicitly vote for it. While I agree that the debt never should have been authorized, it nevertheless has been, and our elected representatives contracted the debt that all of us must now pay.

Would I be sad if the Federal Reserve crashed in on itself and its phony loans and printed money? Not in the slightest. But you can bet that if the US dollar is devalued, our economy would collapse and bring riots and ruin to our nation for decades. Would it be Atlas Shrugged? Perhaps worse, because there is no Gulch yet.

All taxation is nothing more than a protection racket. It should never be used to pay for anything beyond the necessities of defense, courts, and law enforcement. I make an exception for "Pigouvian taxes" (taxes which simply make you pay costs you have imposed on others).

But an individual can and does "sign the check" if he voted for a spending bill, or for a politician who helped impose it.

I favor reneging on the national debt (or, equivalently, printing the money to pay it) because it has been, and is still being, incurred mostly by people who plan not to be around when it comes due. Today's and tomorrow's children cannot morally be said to owe a huge, unpayable debt simply because their parents were spendthrifts. That way lies serfdom.

For individuals the law already handles that situation correctly -- the creditors are first in line for the debtor's estate, but any debt it doesn't cover just has to be written off. They have no claim against the debtor's children.

As for invested wealth suddenly vanishing -- that has already happened. The national treasury contains nothing but IOUs, which no educated person has ever expected to see redeemed. Nothing much will change when they have to say so in plain words. There is no country capable of punishing either the government or ourselves for not paying.

I'm a little unclear, JD. How could you ever "sign the check?" Are taxpayers never responsible for the finances of their nation because "responsibility is strictly individual?"

If the money had only been spent on things you DID agree with (like WWII), would you owe it then? or is your responsibility still "strictly individual"?

More to the point, it sounds like you favor reneging on the national debt.
What do you think would happen to our nation if trillions of dollars of invested wealth suddenly vanished?

Wrong. Responsibility is strictly individual. I didn't spend any of it, or vote for any of it. I don't owe it.

The Greeks don't feel morally bound, either, but they still spent the money.

Don't rationalize theft.
We spent it. We owe it.
Mainly to ourselves - don't forget. Most t-bills are owned by Americans!

I believe that the power motive is far stronger than the money motive,
especially after one gets past the "comfort level" of dollars -- maybe
these days a quarter million a year. -- j
.

You know, I forgot about that. We've been playing with Monopoly money for quite a few years now.

we won the cold war by economic means as much as anything (plus,
our weapons are much better and more reliable). . we will lose this
economic battle, though, if we don't change. -- j
.

http://www.usdebtclock.org/

Especially if all he has is paper. Funny how Monopoly money used to be a joke.

Often true!

Alternatively, the wealthy man was never attracted to 'wealth' at all - but used wealth as a scorecard for 'power'. POTUS has a lot of power.

Jan

the difference between you and the politicians world wide is that you actually work for your rewards, they steal them and actually believe they are "entitled" to their "rewards". when they get together they discuss how successful they have been in screwing the rest of the populations of their respective countries. years ago i was asked why would a wealthy man want to be president when he would only be compensated at that time $250,000.00. the answer was because he could steal a lot more. when our president gives funds to another country it would not surprise me that he gets a "finders fee". i used to think if one of these dictators spread the wealth that he has stolen with the population of the country he would be dictator for life, show me one who has done that.
things in our(?) country are getting worse by the day it appears to me.

More than that, because the official national debt doesn't include Social Security, which is around another $6T. The federal government doesn't have to follow the accounting rules of a private company, including Sarbanes-Oxley. I'd love to see the congressional hearings if they did.

Of course I don't consider this debt morally binding. I never signed the check.

It seems so bizarre to me that all of these top politicos do not understand that the way out is to open the stopcocks of business. I am not an economic savant...I have to take off my shoes to count above 10, as a matter of fact...but even I can see that clearly.

Jan, of common sense

The monetary situation reminds me of the kid who buys 5 sets of the game Monopoly, throws 4 sets away but keeps the money so he'll never run out. It doesn't matter. In real life, no matter how much paper he has, he can still go bankrupt.

Not just Russia, but most "nations" have debt way beyond their means.
My take on all that says that the Great Global Collapse is inevitable. When it hits, GOVERNments around the globe will be OUT OF BUSINESS.

Mankind's last chance at true Liberty.

http://no-ruler.net/

Russia's minute in comparison debt problems does not cause me to feel any better about the certainty the USA will be $20 trillion in debt when the Buffoon-In-Chief leaves office.
Providing that Mr. Marxist does leave office . . .

3 years from now putin if alive and i don't doubt he will be will still be where he is and russia will be as it is. the general population will be where they are and the vodka will continue to flow as it is their escape from reality. just like us the politicians keep heeping the s*** on us telling us how great things are getting to be. when you hear that wear waders and carry a shovel. welcome to impending poverty.

True. "Never let a crisis go to waste."

And Hitler used it long before Saul Alinsky...

Everyone knows it's coming, but no one in gov't will do anything until it's a crisis they can help solve.