Since bankruptcy worked for Trump, now wants to use if on US Federal Debt
This is one of the reasons I looked at Donald Trump's bankruptcies as extremely dangerous: not the bankruptcies, but the attitude of Trump going through the bankruptcies.
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If the government took every single cent of the yearly money supply (not the GDP, mind you) to pay off the debts, it would take 54 YEARS.
THE CRASH IS COMING. There are really 3 options. 1.) Let it crash many years from now when the problem has multiplied. 2.) Monetize the Debt. 3.) Bankruptcy.
Bankruptcy is the best option.
Thank you. I confess that lately I developed a feeling that the Gulch has changed. I admit that perhaps I have changed, but, honestly, I do not think so. The change I perceive is that many comments and replies are less thoughtful, frequently colored by emotion-caused blindness to facts and existence. Some of the tirades about politics I find unpalatable. With all that, I found myself frequently tempted to add my two cents. If I did, I would spend most of my days trying to point out logical fallacies and distortions of fact (or omissions). I decided that I enjoy other things in my life more than to spend all my time trying to ... "straighten meandering rivers" (this a translation of a Yugoslav expression that does not sound as good in English). I like its image of an impossible task.
As you probably noticed, I have participated much more intensely in some discussions and praised the initiators for bringing the subjects up.
I like careful thinking and learning from those who are better at it than I am. What turns me off is people that show unmistakable signs of closed minds. I grew up under the communists and had enough of that mindset for the rest of mu life. It is almost like an allergy.
I wish to thank you personally for the sort of invitation. It means to me more than I can express. But, coming from you, I thought it absolutely necessary to give you a truthful answer.
My main interest here is exploration and deeper knowledge of the Objectivist philosophy. For thoughtful political commentary, there are better sources.
Thank you, dear K. Stay well and keep in touch. So shall I.
EDIT: Spelling correction and missing words
You are wrong. First of all, a bankruptcy is not a default. It can be a restructuring that will allow a more responsible leadership to pay off the debt in a way that allows for no increase in debt. In the case of the USA it would be complicated but could be done. In the hands of strong leadership, it could be a weapon that could humble those holding the debt, and not the other way around. Trump is not nuts. I can also tell that not too many in the Gulch have been deeply involved in the machinations of business. In the hands of a competent leader, debt restructure, can allow for progress and a healthy return to proper budgeting. This cannot be true of countries such as Greece, but America? They will all fall in line in the hopes of future wealth if they see the management of the world's powerhouse on the right track. Even China. And when I say powerhouse, I don't only mean economic, but also military. With the exception of Islam which is insane, the nations will go along and everyone will live happily ever after. (Hey, it's possible.)
I'm not wishing for trouble, but the recent aggressive posturing by China and Russia and O's willingness to tuck our tail between our legs while he seeks to disarms us (and a variety of other destabilizing things), does not inspire confidence in a peaceful resolution to our financial situation should any degree of bankruptcy be taken.
France savaged the hell out of that country.
In my favorite if short lived science fiction TV show, Firefly, only Americans evidently fled Earth to inhabit another star system with beaucoup planets and moons with breathable atmospheres in one heck of Goldilocks Zone without an alien life form in sight..
These folks would interject Chinese into their English for some curious reason.
Harrumph! Harrumph!
His track record using other people's money is poor at best. His arrogance is nauseating. There is no trust in Trump. A looter a practicing eminent domain rip off leftist. His end justifies his means.
No honor no integrity.
BK is certainly a distasteful means to resolve a financial catastrophe. I know this because I've negotiated through a number of them as a creditor. The ugly truth is, America is already bankrupt by definition and approaching insolvency at break-neck speed. To focus the argument on Trump seems to miss the fundamental issue, doesn't it? America is already bankrupt because her consenting public has chosen not to hold up their end of the bargain which is to participate as an educated citizenry. I'll give an example and then stop: I venture to guess that at least 90% of the folks who have a position on the presidential debate could not name any of the following: their district #; their district representative or how they voted on even one issue over the past year; the mayor of their own city; any of the city council; or any of their state senators or representatives.
We not only have a fiat currency that we can't sustain, we have a fiat government at all levels voted in by an uneducated (in a practical context, not by what university they attended on a student loan) citizenry who think it's okay to sit and talk at the adult table when they really don't know what to talk about yet.
If there are any other solutions out there to avoid BK, I'd like to learn more. Is Trump acting like an obnoxious jerk and has he declared BK on certain projects that were losers? Sure he is and yes he has. And he also appears to be the only person in the race hinting at taking on the tougher issues facing our once great country. Sorry, that wasn't as succinct as I'd hoped. :)
PS. Please forgive if you respond to me and I don't get back quickly. I'm new and I'm still working and this is still recreation for me.
However, those who lent the usa government might not be so happy getting maybe one cent on the dollar.
Trump is demonstrating more each day that is acquiring political thinking, say anything that could get you votes.
The truth is that debt is a fungible property, open to negotiations. Only liars or the ignorant pretend that debt is an absolute, reliable asset.
For Trump, such discussions are with regard to a desperate, last resort solution. His preferred solution is to create real, substantial growth in the GDP that will allow paying the debt down, instead of perpetually growing it.
In spite of the the fact that progressives have pissed away that fiat currency...it was the Federal reserve, not the US reserve that created this debt...they are the one's that printed it and made things worse, sold worthless paper to bond holders...have they not?
I dont agree with deficit spending and money printing at all. BUT, I would appreciate the politicians telling me right up front what they are doing. I would rather get the TRUTH than the pack of lies we get now.
In 2008, there were a LOT of bankruptcies and "haircuts" taken by bondholders and stockholders. It happens when things get out of hand, whether governnmental or private.
Our government IS bankrupt right now. Our money is essentially worthless when all the debts that the government has incurred are paid. The national debt will NEVER be paid down through increased taxation. It will hang out there as a sword waiting to fall on all of us.
The reason for bankruptcy laws is to accept the obvious insolvency of the person or business OR government, and find a way to quickly move on to rebuild. Without bankruptcy laws of some sort, the debt just hangs around forever and rebuilding doesnt occur.
I would rather Trump tell me we are bankrupt as a country and we find a way to move on and not make the same mistakes again. As opposed to Hillary just manipulating us into thinking we arent bankrupt and just need to print more money and stretch the rubber band another day. I am so DONE with the lying, manipulations, and kicking the can down the road of the establishment. At least Trump is bringing out the debate for all to see. Thats NOT bad.
I do not hold Trump responsible for the nation's debt. But that he would suggest effective bankruptcy on the part of the United States without first necessitating deep spending cuts is a sign that he is no better than our current politicians in dealing with debt problems. Maybe you missed his announcements, but Trump supports borrowing our way out of our economic malaise in complete ignorance (willful or otherwise) that it's already been done twice in the past 20 years!
In the case of the USA, it HAS declared bankruptcy a number of times already. When Nixon went off the gold standard and refused to pay the debts in gold to other countries- that was essentially what Trump is talking about. My $2 bill that I saved from college in the 60's which is now worth less than 20 cents in any sort of real value- tell me I didnt take a haircut on that, as did everyone else who had the stupidity to trust our government to honor its debts. Isnt that essentially "bankruptcy" without calling it that.
When the repubs complain Trump is abandoning fiscal responsibility, I wonder what they said about the Bush years, and what about Paul Ryan's big sellout on the latest deficit budget? They are hippocrites.
With all the unfunded liabilities out there, the USA is already bankrupt. Our money is worth essentially nothing in terms of real value when the debts are paid. We might as well admit it, basically as Trump is doing.
That said, accepting that you are bankrupt should mean that you analyze what got you there, and you STOP doing those things before you indicate to your creditors that they will get nothing, or at least a reduced amount.
Trump didnt do that- which I think is not a good thing, and I agree with you on that ..
At some point, the chickens will come home to roost on this debt. There isnt the money there to pay off all the entitlement promises, and those people will have to take a haircut, as well as anyone who has dollar denominated assets. What can I say. We have all taken a haircut already with inflation over the last 50 years.
Bringing out whats been done is a GOOD THING, and I hope people can be made to realize whats happened and who did it.
And printing money devalues the entire currency base. It's the failed policy we've been using for the past eight+ years. If you want to print money to pay off creditors, you are in fact introducing massive inflation and across-the-board currency devaluation. In the situations where we have seen that in the past century it has led to an absolute disaster for those nations. See Argentina, Zimbabwe, and others.
Can the US do it? Probably. Does it carry severe consequences? Absolutely. Do I think Trump considered these circumstances before profferring his opinion? I doubt it.
When? If you are referring to Nixon and the move to get off a hard currency standard, that was a fundamental change to how we were declaring the value of our currency and it acknowledged the simple fact that other nations were looting the US' own gold holdings by virtue of their own devaluations. I do not in any way equate that situation to what is being proposed here.
"I bet Trump knows more about debt than any of the folks now in power."
I don't want ANY of the parties to know about debt! I want them to know about productivity and fiscal responsibility! I want them to operate on the principle that bankruptcy is the last resort not the first and that one's reputation suffers as a result! I want people to get back to honoring their commitments - not taking out commitments which they had no intention of repaying in the first place!
What we are talking about is a representation of the values of America and whether or not we want to viewed as looters like many other nations. Looters use bankruptcy to avoid their contractual obligations. That anyone here is a proponent of this mentality is profoundly disappointing.
Any politician who says there's another option is either deluding himself, or trying to delude the rest of us.
i am in my late 60's and i am not concerned for me and my future, but my children (adults now) and my grandchildren face a very different future that i did at their age...
in a democracy, majority rules...including tyranny of the majority...and a majority that has demonstrated a willingness to surrender everyone's freedom and liberty in exchange for a politician's promise of "security"...a slide into totalitarianism...
i remain optimistic that ideas like Trump's can be discussed and accomplished for a future for everyone...we will see...
I don't mind clarification, but his initial proposals were a lot more of his "speak first, think later" methods. To me, those are the sign of someone who needs to sound authoritative on everything and wants to be seen as having an answer - any answer - rather than the right one. That particular propensity of "The Donald's" concerns me greatly because it is much harder to negotiate when one has already laid out a position...
Trump did not say he would take the US into bankruptcy. He would try to renegotiate - not renege on - debt. There is a world of difference.
Besides, the US is already bankrupt and reneging on it's debt service by the 3 to 5 trillion dollar devaluation of our currency and the value of your property which they call Quantitative Easing. The government steals the value from all of us, by printing up dollars (Actual or electronic) then spends that value and pays back the dollar amount of the debt with that devalued dollar. The Corrupt US govt run by two private corporations called Democrat and Republican party always pay back debt with devalued money. That is already forced renegotiation of debt. Theft in layman's terms both from the lender and from the people. They keep the dollar amount of the debt the same but give less value in each dollar.
Trump wants to renegotiate the amount of dollars of debt not devalue the currency.
The saddest part is that no one else seems to be willing to learn from their example - least of all the United States.
"He would try to renegotiate - not renege on - debt."
Bankruptcy is exactly that: reneging on payments owed. It's legal, but hardly ethical. And we're not talking about an individual business in this case, but the most productive nation on the planet. What happens if we "renegotiate" our outstanding debt? Our debt service rating tanks and our interest rates rise, putting us on a very dangerous path to insolvency.
Has the government been a good steward of our money? Absolutely not - we agree on that. The problem is that we have dug a huge hole for ourselves that now we must fill in. We both agree that QE is a gimmick for devaluing the currency and our corresponding debt so that the politicians can continue to play this game of buying things they can't pay for to stay in power. Is Trump really going to change that? I don't hear any calls for a Balanced Budget Amendment or reduced spending, but I do hear calls for "taking care of people" - code words for more welfare. And just this week he said we need to spend our way out of recession by investing in infrastructure projects! Does that sound like someone who is pushing for smaller government or government constraint?
Still, what I speculated isn't at all far fetched. Look at who we owe the most money, look who's buying up US soil, look at who has expanded its military. If we default. China will take the most serious financial hit for trusting US and they will respond. I also suspect Russia won't hesitate once China makes its move.
Will Trump default? No one can say for sure, but he has used that "tool" in the past and shows no embarrassment when he brags about doing so.
http://www.breitbart.com/2016-preside...
and follow-up
http://www.breitbart.com/tech/2016/05...
...Ignore it or think of it in a conscious quantum physical way if you need to.
We're heading into the second cycle of economic repression using and Trump has figured out he can't repeal TANSTAAFL?
look elderly and military retirees it's BOHICA time again.
The Blaze is a less than reliable source. I would say that about nearly any story they run. But in this case they are cherry picking from the NYT..also known to shade the story.
Brett Braier interviewed him.5/4/16
He made the comments on an interview with CNBC, so go watch the original if you want. It's not a cherry-picked statement - it was very obvious that Trump thinks it is a legitimate strategy for dealing with debt.