Federal government will never default on debt unless their money printing machine breaks down.
“Federal government will never default on debt unless their money printing machine breaks down.”
Our government don’t just ‘print’ money. It borrows it and has to pay interest. As our economy looks shakier, lenders demand higher interest on their loans to us.
If the total interest expense on existing borrowing becomes too high, presumably the government will quit paying the interest or perhaps not even return the original bond amount to holders.