You have >1T dollar of debt, your bond was held by mainly China, and you keep on printing money (QE1,2,3,4,5,...........), so people who bought your bond are actually holding "paper" only. You are rascal!
I would go way beyond that . The Government is for the people who work for the government , and most of them are bastards , therefore the government is a bastard , specially the local government, the laws don't mean much to them , specially about pollution.
Nah, way more than that. Nah, China only holds about 8% of the public debt (which works out to abaout 5% of the total debt). More US public debt is held by American households, businesses and other institutions than by all foreign entities combined. But without seeing much inflation, note. Not unless we start seeing a lot more inflation than we have.
Unfortunately Saint and those of his ilk are not going to let little things like facts and reality ruin their fantasies.
Its complicated. And in regards to China, wouldn't it make sense that they would be happy to keep the USD over-valued and the Yuan under-valued? Think of this in terms of international trade - US purchasing power vs Chinese production and export competitiveness... In the current global financial paradigm, debt creation is absolutely fundamental to economic growth. Perpetual creation of new debt is necessary to avoid a global recession. Massive debt needs to exist. Most governments are rascals. Most banks are rascals too. And generally, it seems like we are stuck on this absolutely unsustainable trajectory...
Is your GDP true? I heard US GDP >1T dollar, then why are you troubled by debt? You can produce enough to pay debt, right?
The total GDP of America is 16 trillion dollars. America owes 16 trillion dollars and that amount is growing everyday. So once America owes more than it makes it is in economic problems for most people see that as a point of bankrupcy, owing more than you earn.
Oh, so most people think that? Where is your evidence? Do most informed, knowledgeable people think that? No they don’t. Let’s get real, shall we? One, that 16 trillion dollar figure includes debt the government owes to itself which is about 5 trillion dollars. Unlike private industry, the government uses the “fund” accounting method. It does not net out “interagency” accounts. So the real US debt is about 11 trillion dollars as of September 2012. What you are doing is just repeating headlines with no understanding of what is being communicated. Two, in the past The United States has had much higher levels of real debt, where real government debt exceeded the national gross domestic product (e.g. Post WW II, a period of great American prosperity) and the debt was managed without catastrophic consequences. Three, using your “most people” story, most people with home mortgages are also bankrupt – bankrupt from the time they sign the mortgage documents. Because their mortgage, the amount they owe exceeds their annual income. So your “most people” reasoning doesn’t pass even elementary scrutiny. What is of concern is our long term fiscal policy. The fiscal irresponsibility of the first decade of this century has left us with some very serious long term fiscal issues. But those issues are not insurmountable. They are manageable. But they won’t be resolved with the tabloid solutions being marketed by right wing demagogues. Four, sovereign governments do not go bankrupt. Sovereign governments, unlike individuals, can always raise money and print money to pay their bills if they have the political will to do so. http://upload.wikimedia.org/wikipedia/commons/3/30/Publicly_Held_Federal_Debt_1790-2009.png
Yes. It's about 15 times that. Indeed, the bond markets are not exactly in revolt at the US debt. It's more of a political thing, a pretext for the Republicans to oppose things that would benefit Obama.
No it is not, nor are any of the 182 currencies in circulation today on the planet Earth backed by gold or any other commodity. There are many good reasons the world left the gold standard in the last century (e.g more stable economies).
That is nonsense. The standard, conservative US home mortgage is 3-4 times annual pre-tax household income. Owing 3-4 times what you make in a year is not anywhere close to bankruptcy - it is the standard debt load of conservative, well-financed homebuyers in the USA (and elsewhere) for generations now. Literally tens of millions of perfectly solvent, financially secure Americans currently owe way more than what they make in one year. It is, frankly, bizarre that this canard about debt equalling annual income amounting to insolvency gets any traction in the USA, or anywhere else. When people say it, I know immediately that they are financially illiterate, have never even looked into buying a house, and can be safely ignored. "Bankruptcy" is when the cost of servicing the debt exceeds what you can afford to pay. There is no hard and firm definition of when that point occurs, but it is far, far beyond owing one year's worth of income. Especially at the interest rates being issued on debt these days - the USA is paying negative real interest on new debt it issues, so it can issue lots before running into solvency problems.
Well, there are still currencies called "commodity currencies." These are not literally backed by commodities in the sense that you can go to some government office and trade them in for commodities. But the situation isn't far off from that: this refers to countries whose economies are heavily dependent on exports of one (or a small number) of commodities (typically, oil). In that case, the value of said currency still ends up tracking that commodity pretty closely (since its value pretty much determines the economy in question), and since they are major exporters of such it is straightforward to exchange said currency for said commodity. Pretty much all of your petrostate currencies are considered "oil currencies" for this reason.
That is true, but I think the discussion was in regards to government backing of currency and not how the currency trades in open markets.
