dagblog - Comments for "Trump: 'Make Deals' to Cut National Debt"

I get your distinction but in

Michael Maiello — Sat, 07 May 2016 12:21:19 +0000

I get your distinction but in bond world, missing a payment, even if (especially if) everyone knows you have the money, that's a default. Willingness to pay is sometimes more important than ability to pay, especially with sovereigns where creditors need an army to seize assets.

I think there's a large

ocean-kat — Sat, 07 May 2016 05:18:36 +0000

In reply to Everybody's acting like this

I think there's a large difference between what the republicans planned to do in 2011 and Trump is proposing. The tea party idiots weren't planning on repudiating the debt. They were planning on stopping payment until they got concessions from the democrats. At which point they would continue payments and make up the amount delayed. They thought the delay would have been no big deal though most economists thought it would be devastating.

Trump is planning to repudiate the debt and renegotiate it down to pennies on the dollar. Both would be devastating to the world economy but Trump's plan is a whole level of stupid above the normal tea party idiocy.

Everybody's acting like this

Michael Maiello — Sat, 07 May 2016 03:54:26 +0000

In reply to Trump: 'Make Deals' to Cut National Debt

Everybody's acting like this is so out there an idea... not true! It is mainstream Republicanism, in the 2010 decade. In 2011, mainstream Republicans threatened to default on the debt in order to force Obama into spending concessions. They came so close to following through that S&P downgraded the U.S. Treasury, which caused a stock market panic and nearly derailed the Obama recovery. This was a mainstream Republican action that actually happened. What Trump is suggesting is entirely in line with it.

Republicans threaten the credit of the USA and, by extension, an entire global financial system based on the idea that US Treasuries are a "risk free" asset.