Alright you windbags I have a solutions to the $10 trillion debt

[Something Rotting Demark]

For the PERCENTAGE that is owed to United States citizens, why not print enough money to cover that?

Once payed off, then the USA could tell foreigners were not paying you too, and then the USA could start fresh.

Would this work?

[Aaron Brachowitz]

I think we could only do this if we found a concrete way to live within our means going forward. Because otherwise we have to borrow, and if you default or devalue no one will lend to you going forward (or only at payday-loan type interest rates). But I could definitely see it happening at some point, we're just not there yet.

Oh, and it might start a war with China, Korea, and Japan. And we'd need to borrow from them in order to fund it.

[Jack]

The debt is fungable. I'd buy some of the foreign debt.

What we could do is get our financial/budget house in order and gently increase inflation to let's say the 7% range and use a combination of prudence and inflation to solve the problem.

[zeuz]

I say we should conquer the world and colonize it. Then, exact as much wealth from the peasants.

[Seldon]

Originally Posted by zeuz

I say we should conquer the world and colonize it. Then, exact as much wealth from the peasants.

We would have done this by now if we could think of a way to convince the foreign governments to keep lending to us while we are at war with them.

[Westley]

Originally Posted by Jack

gently increase inflation to let's say the 7% range and use a combination of prudence and inflation to solve the problem.

So, you're saying a "flexible freeze"?

[Tim><]

Assuming this does not trigger a war, expect to see an epic decline in the value of a dollar. In addition to the one-time adjustment, the "free" market could no longer assume that the Fed would somewhat reasonably control the supply of money.

Foreigners would dump all their US debt. Locals would try to swap cash for commodities. Import prices would skyrocket leading to a domestic hyperinflation of anything not produced in the US, or made from raw materials not found here.

This would lead to a depression that would make the Great Depression seem - well great by comparison.

I'm not very knowledgable on Africa, but I think this is similar to what Mugabe did. A little google or Wiki can give you a picture of how that worked out.

[Tim><]

Originally Posted by Jack

The debt is fungable. I'd buy some of the foreign debt.

What we could do is get our financial/budget house in order and gently increase inflation to let's say the 7% range and use a combination of prudence and inflation to solve the problem.

Which foreign debt are you thinking about? My impression is that Europe is going to have it a lot worse than us. Oil producing middle eastern and south america are going to be in for hard times to cover the expansion of social programs expected to be funded by high oil prices - many of these assumed the peak was permanent or even a stepping stone.

Inflation will happen, but even so - I only see two solutions -

Increase Tax Revenue
Reduce Spending

Either one of these would slow down our economy - the prudence you mention should come in the speed and combination of the two approaches utilized.

[Dr T Non-Fan]

Originally Posted by Something Rotting Demark

Once payed off, then the USA could tell foreigners were not paying you too, and then the USA could start fresh.

Would this work?

Originally Posted by Aaron Brachowitz

Oh, and it might start a war with China,...

China has a shitload of US Treasury securities. Angering them would bot be prudent.
Selling them Alaska might do the trick.
Or Hawaii.

[Jack]

Originally Posted by Tim><

Which foreign debt are you thinking about? My impression is that Europe is going to have it a lot worse than us. Oil producing middle eastern and south america are going to be in for hard times to cover the expansion of social programs expected to be funded by high oil prices - many of these assumed the peak was permanent or even a stepping stone.

Inflation will happen, but even so - I only see two solutions -

Increase Tax Revenue
Reduce Spending

Either one of these would slow down our economy - the prudence you mention should come in the speed and combination of the two approaches utilized.

I meant I'd by US debt owned by foreigners. My sentence wasn't clear.