How much longer can the US House of Cards defy gravity?
Yesterday we implied a difficult question when we illustrated the huge size of US Treasury bond holdings that China and Russia have between them - accounting for 25% of all foreign held debt - implicitly funding US standards of living (along with the Federal Reserve). [emphasis added][groan]
The array of nations around the world will simply foreclose their various mortgages on this territory once known as “the United States of America”, and treat it like they would a territory in central Africa, or an island out in the middle of the ocean. Come in with their various machinery for extraction, scoop up the resources, and haul it away.
Enter the era of “new colonialism”.
Meanwhile the Chicoms are manipulating their economic data and are building ghost cities in order to prop up their numbers. Who really has the bigger house of cards here? No matter how commie the man in the White House is, I don’t think that we can outdo the Chinese. Maybe if the amnesty pimps have their way, of course. Then we’ll have them beat. As for the Russkies, you don’t see any Russians with any wealth sticking around in Moscow because it is so nice and prosperous there.
It will print enough money to buy all the debt if need be. Even though financing the government isn't in its mission statement; this is one of the reasons Congress approved its creation.
The only thing saving us is that we’re the ChiComs biggest customer. Otherwise, it’s always the banker who has you by the balls.
To quote the World's Smartest Woman, What difference does it make ... the currency is already irreparably damaged ... we can't possibly borrow and successfully repay what we need right now to fund ongoing operations ... our only option is to print fiat until the dollar completely collapses ... and we are going to do exactly that until the idiot public finally figures out that they are carrying worthless paper trash in their wallets!
Dumping US debt? To who?
Barack. Obama. Does. Not. Care.
He doesn’t care if we go belly up. He wants it. They haven’t figured that out yet?
FOOD for them will become quite expensive. We just will not export food any longer unless it is in return for our debt. Anyone that doesn’t think we have strings to pull is mistaken. And our armed forces would be used to defend our borders and allies. If we didn’t have OBAMA we wouldn’t need any of the outside energy resources and could explore for minerals and bring manufacturing back to the USA. We would and could be back into making things, I’d say we would/could cut off the internet between us and them as well. No connections would probably be good for us as well.
The Chinese give us money to give to Taiwan to protect Taiwan from China. Who is dumber is a toss up there...
the Mexican drug cartels?
Debt problem? We don’t have a debt problem. As long as the Fed continues to invent $20 billion in new money each and every week and faithfully hand it over to the Treasury, the government no longer needs to borrow money. And as long as the government doesn’t need to borrow money, interest rates will remain low. What could go wrong with that?
Foreign investors aren’t going to buy it for long either way. The quantitative easing prop for that is reported to be ending. Bond yields will go up, while prices fall, then bond collapse. Pensioners depending on bonds will be left with little or nothing. Interest rates will skyrocket. Business will slow down. Revenues will fall. Government layoffs. Vicious circle.
We are. Prepare to have your retirement accounts seized.
China is locked in a murder/suicide pact with us. They dump our debt - our economy crashes - we stop buying cheap plastic stuff from them - their house of cards collapses.
The question is how much of our debt would you have to dump to crash the system? Would Russia’s share be enough? What’s the tipping point?
Who will China sell its goods to if they will not buy US bonds and Washington responds by putting a hefty tariff on all Chinese made products?
Russia has a sweet deal selling weapons to Syria. She ain’t gonna like U.S. intervention.
The debt is going to be repudiated, obviously.
There is no historical example of a debt of this nature being paid off. What has never happened, won’t.
We own more of our debt than China does.
Debt?? It isn’t really debt if you never plan to pay it off.
Perhaps this is another part of the Cloward-Piven: piss off China so they stop buying our IOUs. That would effectively end our consumer-based economy and then no one would care if we go communist.