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Only an idiot as stupid as the donald could suggest not paying the money promised to creditors by the US government. The validity of said debt is guaranteed in the US constitution. donald think running the USA is the same as running his ponzi scheme real estate business where debts are not worth the paper they are written on.
Thats NOT how its done...
The government buy backs the debt using auctions where people CHOOSE to cash out at a bidding competitive price, and to pay those costs, they reauction off new bonds at lower rates.
Obama has been doing this, paying off higher interest debts at lower ones, and even Clinton ran auctions to buy back bonds to pay lower rates than issued..
Did Clinton create a ponzi scheme?
The Treasury Department, falls under the Presidential Cabinet.
All the liberal media is doing attacking Trump everyday and helping Hillary stay undercover of the FBI investigations. CNN swept that FBI thing under the floormats while Trump gets attacked everyday for little stuff.
Of course it helps their ratings, people who like and dislikes Trump only read the news if Trump is front and center.
The government buy backs the debt using auctions where people CHOOSE to cash out at a bidding competitive price, and to pay those costs, they reauction off new bonds at lower rates.
Obama has been doing this, paying off higher interest debts at lower ones, and even Clinton ran auctions to buy back bonds to pay lower rates than issued..
Did Clinton create a ponzi scheme?
Yes, the US does buy back debt when it can.
The problem is that, as the article states, this can't retire a significant amount of the debt. Maybe people are reading too much into what Trump is saying, but in order for debt buy-back to have an appreciable effect, you'd have to be trying to buy it back at pennies on the dollar. Which would be signaling that you think the whole US economy is days away from complete bankruptcy. Which would be a very bad signal for a US president to send.
The problem is that, as the article states, this can't retire a significant amount of the debt. Maybe people are reading too much into what Trump is saying, but in order for debt buy-back to have an appreciable effect, you'd have to be trying to buy it back at pennies on the dollar. Which would be signaling that you think the whole US economy is days away from complete bankruptcy. Which would be a very bad signal for a US president to send.
You dont need to retire a significant amount of debt, as we seen under Clinton. You just need new debt at lower rate than the old debt, and with a reverse auction, people CHOOSE to take less money than they did when they purchased the bonds.
If you have a $100 bond paying .5%, thats $100 debt..
but if you agree to replace that $100 bond by taking $99 at .55%, you've lowered the debt 1%, without bankrupting the nation as people claimed. And if you agree to do it at .5%, then the deficits also drop lower than they would have been given you are now only paying interest in $99 rather than $100.
It doesnt need to be in large discounts to have an effect on the debt given the total debt is nearly $20 trillion.
Clinton successfully did the exact same thing, and even though he ran deficits, he's given credits for running surpluses and "balancing the budgets" because people accepted less money than they did when they bought the bonds.
No one ran around proclaiming we were on the verge of bk during Clinton years.. In fact, just the opposite.. It gave so much confidence in our future it exploded the economy.
Just yesterday the debt was created by creating money out of thin air..
today, that money was removed from the economy , specifically a retired citizen in Milwaukee..
You cant make up this type of humor.. You just make it up as you go along
You are talking Apples and Oranges.
The U.S. creates money (debt) out of thin air by issuing government securities, which are deposited with the Treasury, and then "printing" the same amount of dollars that are spent on government appropriations. Thus, dollars are introduced into the economy by deficit spending.
People, banks, businesses, and countries that hold dollars often choose to "invest" those dollars in federal government bonds, as they earn interest, and are basically risk-free investment. When the maturity of those assets mature, they expect the same amount of money back -- not that the government is going to try to short-change them.
You dont need to retire a significant amount of debt, as we seen under Clinton. You just need new debt at lower rate than the old debt, and with a reverse auction, people CHOOSE to take less money than they did when they purchased the bonds.
If you have a $100 bond paying .5%, thats $100 debt..
but if you agree to replace that $100 bond by taking $99 at .55%, you've lowered the debt 1%, without bankrupting the nation as people claimed. And if you agree to do it at .5%, then the deficits also drop lower than they would have been given you are now only paying interest in $99 rather than $100.
It doesnt need to be in large discounts to have an effect on the debt given the total debt is nearly $20 trillion.
Clinton successfully did the exact same thing, and even though he ran deficits, he's given credits for running surpluses and "balancing the budgets" because people accepted less money than they did when they bought the bonds.
No one ran around proclaiming we were on the verge of bk during Clinton years.. In fact, just the opposite.. It gave so much confidence in our future it exploded the economy.
The bolded is the part of your post that I disagree with. To have a noticeable effect on that enormous pile of money, you'd have to be "offering" enormous discounts. And I don't see how you'd find a "willing seller" in that case.
You dont need to retire a significant amount of debt, as we seen under Clinton. You just need new debt at lower rate than the old debt, and with a reverse auction, people CHOOSE to take less money than they did when they purchased the bonds.
If you have a $100 bond paying .5%, thats $100 debt..
but if you agree to replace that $100 bond by taking $99 at .55%, you've lowered the debt 1%, without bankrupting the nation as people claimed. And if you agree to do it at .5%, then the deficits also drop lower than they would have been given you are now only paying interest in $99 rather than $100.
It doesnt need to be in large discounts to have an effect on the debt given the total debt is nearly $20 trillion.
Clinton successfully did the exact same thing, and even though he ran deficits, he's given credits for running surpluses and "balancing the budgets" because people accepted less money than they did when they bought the bonds.
No one ran around proclaiming we were on the verge of bk during Clinton years.. In fact, just the opposite.. It gave so much confidence in our future it exploded the economy.
That's not really the way reverse auctions work. A $10,000 T-bill, if rate of interest was 2.5%, would sell for $9,750 -- which means that the government is borrowing $9,750 and will repay $10,000 at maturity. At maturity, the government pays $10,000, which is a debt of $10,000.
A bond issued at a lower rate means that the amount borrowed gets closer to the amount paid at maturity. Thus, a $10,000 bond at 1%, the lender to the government would lend $9,900 and receive $10,000 at maturity.
What the Trump proposal does it not give back the full $10,000 at maturity, which nobody would agree to accept.
The U.S. creates money (debt) out of thin air by issuing government securities, which are deposited with the Treasury, and then "printing" the same amount of dollars that are spent on government appropriations. Thus, dollars are introduced into the economy by deficit spending.
People, banks, businesses, and countries that hold dollars often choose to "invest" those dollars in federal government bonds, as they earn interest, and are basically risk-free investment. When the maturity of those assets mature, they expect the same amount of money back -- not that the government is going to try to short-change them.
So they TAKE MONEY OUT OF THE ECONOMY, to buy federal bonds, to do things like fund the stimulus bill.
The bolded is the part of your post that I disagree with. To have a noticeable effect on that enormous pile of money, you'd have to be "offering" enormous discounts. And I don't see how you'd find a "willing seller" in that case.
Why don't you just come out and say the truth, you don't want a solution.
You don't want anything new, just keep piling up the debt to bankers
and to hell with the American people. Keep looking for excuses, looking
for slavery and victimhood.
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.
I agree with Trump.
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