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If you are buying back $10K bonds at $9900 you did lower the debt, by $100.. and also the deficit, since you're using new debt to pay back the $9900 and not paying interest on the $100 you just saved..
The new debt would be at a much higher interest rate as investors, if they could be found, would consider it high risk. They would be literally gambling that the U.S. would honour its commitment to pay the money back at the agreed interest rate and not try to welch on the commitment.
Just the election of Trump, and his threat of default, would result in a major downgrade of the US credit rating on November 3rd and affect the ability of the gov't to meet it's obligations (social security....)
If you are buying back $10K bonds at $9900 you did lower the debt, by $100.. and also the deficit, since you're using new debt to pay back the $9900 and not paying interest on the $100 you just saved..
No, you didn't lower the debt because you are ignoring present value. $9,900 today is the same as $10,000 at some point in the future.
In any case, this line of argument is just obfuscation, as this is not what Trump is suggesting. He's suggesting offering debt holders far less than the government originally agreed.
Just to help you out, feel free to search refinance national debt in the forum using this as your page-Politics and other Controversies. Their are way to many hits to quote from.
Thats not an answer.. in fact its an indication that you just made it up.. which I already knew...
No, you didn't lower the debt because you are ignoring present value. $9,900 today is the same as $10,000 at some point in the future.
the debt does not count future value of money.. You're just being stupid...
Remember YOU are the one who claimed they just created the money out of thin air...
Quote:
Originally Posted by MTAtech
In any case, this line of argument is just obfuscation, as this is not what Trump is suggesting. He's suggesting offering debt holders far less than the government originally agreed.
Which is EXACTLY what Clinton did.. But are you now admitting there are actual people who REMOVED money from their own pocket to buy the debt, thereby removing money from the economy so the stimulus bill did ZERO?
The new debt would be at a much higher interest rate as investors, if they could be found, would consider it high risk. They would be literally gambling that the U.S. would honour its commitment to pay the money back at the agreed interest rate and not try to welch on the commitment.
The exact opposite occurred when Clinton did it.
They fell.. because the debts were being PAID.. and while they were paid at a discounted rate, the investors CHOSE to cash them in...
Just the election of Trump, and his threat of default, would result in a major downgrade of the US credit rating on November 3rd and affect the ability of the gov't to meet it's obligations (social security....)
nonsense.. just left wing babble of fear mongering as always..
The only time the downgrade took place is under a Democratic President who wouldnt deal with the issue AT ALL..
19% Social Security
13% Other Federal government
12% Federal Reserve
9% China
8% Japan
19% Other foreign nations
6% Mutual Funds
3% State and Local governments
17% All Other
How many people did Clinton screw when he did the EXACT same thing?
I'm a trump supporter and this is ridiculous. One thing that surprised me about him is I thought he would be very intellectual.
US treasuries serve as the risk free debt instrument to the worlds financial system. There can't be some type of showmanship where you play games with this. The man is just not very well versed about many important subjects. This is father fundamental and a junior in college Econ major should know this.
I certainly hope this makes you think twice about supporting someone that incredibly UN-intellectual.
Why would a retire citizen in Milwaukee, who bought government bonds because of their safety, agree to accept less than the face value of the bond? Why would they and why should they? They have a contract with the U.S. government who agreed to pay the amount due at maturity.
Moreover, the "idea," such as it is, lacks the understanding that 75% of all U.S. debt is held by other Americans. These are the people that Trump is saying should not get what they were promised.
Again, Trump proves what pathetic idiot he is. Just ask Greece how well this idea turned out
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