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43 sats \ 6 replies \ @freetx 7h \ parent \ on: Charted: U.S. National Debt, as a Percent of GDP (1900-2035P) econ
They cannot pay the debt off....I don't mean that as a fiscal problem. Our money is debt (or, our debt *is money).
So paying off debt = destroy money. If they paid 50% of the debt off, that would be $17T in money wiped out (ie. massive deflationary collapse).
Until they get down to the couple of trillions dollars in actual specie.
Yeah, paying off the debt would necessitate a 90% contraction of the money supply. Although, the Treasury could always crank up the actual printer.
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we should be able to cut federal budget to fiscal year 2019, i.e. pre Covid spending levels
That should trim 2 trillion annually?
update: paying down debt is unnecessary as long as we don't default on our bond payments
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What happens to the holders of dollar denominated debt with the bitcoin plan? It seems like that's just a variant of one of the other three choices.
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They will receive dollars that may not be worth much in 30 years.....they too should transition to bitcoin standard.
(btw, I just saw someone on twitter post a "BitBond" strategy that is clever. When bonds are sold, Treasury allocates 1% of funds raised into bitcoin and held in cold-storage. At maturity, Treasury pays back 99% fiat and the 1% BTC.....)
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The 2 biggest liabilities are Medicare and Social Security.
Eventually we have to privatize both. The other option is we pay everyone off with a lump sum (present value discount).
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