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Donald Trump’s Idea to Cut National Debt: Get Creditors to Accept Less

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posted on May, 6 2016 @ 12:24 PM
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originally posted by: Profusion


Didn't Trump just describe the essence of bankruptcy?



Isn't the United States, in essence, bankrupt? We have a national debt which exceeds the value of our assets (GDP). That's bankrupt. Should we just keep kicking the can down the road, amassing more and more debt so that we can also amass more and more austerity? Or, since the United States prints its own money AND is the owner of the defacto reserve currency of the world, do we declare bankruptcy and tell the creditors "Suck it," knowing that we have the ability to live well within our means following that declaration of bankruptcy and can run this nation perfectly without the need to borrow money following dissolution of the government's debts?




posted on May, 6 2016 @ 12:30 PM
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a reply to: dawnstar

What part of "ALL of us at every level" didn't you get?

Part of the problem with the last recession was that when the economy tanked and shed tons of jobs, the government did not do a similar contraction. So basically, an much diminished private sector was still on the hook to make up for the same sized public sector and then Obama made it that much bigger.

Government needs its own recession and job shedding as harsh as that sounds.



posted on May, 6 2016 @ 12:43 PM
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a reply to: Profusion

JUst making himself unelectable.



posted on May, 6 2016 @ 12:48 PM
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a reply to: burdman30ott6

if we tell creditors "suck it", is that enough to start a war (or several)? I would bet!

Kicking the can down the road sounds like the route they will take
edit on 6-5-2016 by FamCore because: (no reason given)



posted on May, 6 2016 @ 12:48 PM
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originally posted by: TonyS
a reply to: Profusion

JUst making himself unelectable.


How is that when polls like this paint a picture of an America which largely agrees with Trump's position on this matter?

But when pressed to name their biggest concern, nearly half of respondents say they are alarmed by the prospect that the debt could grow beyond its current limit of $14.3 trillion, according to a new Washington Post-Pew Research Center poll. Only 35 percent say they are more worried about the risk of default and economic destabilization if Congress does not raise the debt limit.



posted on May, 6 2016 @ 12:50 PM
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a reply to: FamCore

Let them start a war. We'll finish it and come out of it with another long boom period just as we did following WWII. If the USA started a war over debt, we'd be the bad guys... I must presume if someone else starts a war against the USA over debt, we'd be the good guys.



posted on May, 6 2016 @ 01:01 PM
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originally posted by: burdman30ott6

originally posted by: Profusion


Didn't Trump just describe the essence of bankruptcy?



Isn't the United States, in essence, bankrupt? We have a national debt which exceeds the value of our assets (GDP). That's bankrupt. Should we just keep kicking the can down the road, amassing more and more debt so that we can also amass more and more austerity? Or, since the United States prints its own money AND is the owner of the defacto reserve currency of the world, do we declare bankruptcy and tell the creditors "Suck it," knowing that we have the ability to live well within our means following that declaration of bankruptcy and can run this nation perfectly without the need to borrow money following dissolution of the government's debts?


We cannot just print out our own money per say! Our dollars would be completely devalued globally. Even Trump recognizes this. He can attempt to negotiate a 'trim' with creditors, but being the one of the super powers of the world means, not many creditors would actually negotiate a lower debt.



posted on May, 6 2016 @ 01:05 PM
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a reply to: CynConcepts

Yet print excessive amounts of money is exactly what we did over the past 3 "Quantitative Easings."



posted on May, 6 2016 @ 01:10 PM
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a reply to: burdman30ott6

Well, those polls may show "Muricans" fear the debt, and I understand that, but Trumps proposal is nutters; it amounts to an attempt to "manage" a default on the debt. It works in business, but not on a national level. It would cause untold damage and turmoil to the markets and financial institutions who "own" the debt.

I guess a majority of "Muricans" haven't thought that through yet. Of course, it only just happened as I understand it.

Love your Avatar!
Thanks



posted on May, 6 2016 @ 01:12 PM
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It's an interesting approach. If ever there were any entity that was too big to fail, its the USA. Every country in the world would sink into depression if the US economy really tanked. It seems like Trump is going to play hardball in a number of areas on the basis that the US economy is the golden goose for the world.

In essence his plan can be viewed as taking money back from greedy creditors and giving it back to the people. The elite and utterly greedy bankers are not going to like this at all.

What Trump is telling the world is that the USA holds all the cards. He is right.
edit on 6/5/2016 by UKTruth because: (no reason given)



posted on May, 6 2016 @ 01:13 PM
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originally posted by: CynConcepts

originally posted by: burdman30ott6

originally posted by: Profusion


Didn't Trump just describe the essence of bankruptcy?



Isn't the United States, in essence, bankrupt? We have a national debt which exceeds the value of our assets (GDP). That's bankrupt. Should we just keep kicking the can down the road, amassing more and more debt so that we can also amass more and more austerity? Or, since the United States prints its own money AND is the owner of the defacto reserve currency of the world, do we declare bankruptcy and tell the creditors "Suck it," knowing that we have the ability to live well within our means following that declaration of bankruptcy and can run this nation perfectly without the need to borrow money following dissolution of the government's debts?


We cannot just print out our own money per say! Our dollars would be completely devalued globally. Even Trump recognizes this. He can attempt to negotiate a 'trim' with creditors, but being the one of the super powers of the world means, not many creditors would actually negotiate a lower debt.


He can attempt to negotiate a 'trim' with creditors

Not according to many experts.


The United States of America, however, is not a real estate development company. If a real estate company defaults on its debts and its creditors lose money, that's their problem. If a bank fails as a result, then it's the FDIC's responsibility to clean it up.

The government doesn't work like that. Right now, people and companies all around the world treat US government bonds as the least risky financial asset in the universe. If the government defaults and banks fail as a result, the government needs to clean up the mess. And if risk-free federal bonds turn out to be risky, then every other financial asset becomes riskier. The interest rate charged on state and local government debt, on corporate debt, and on home loans will spike. Savings will evaporate, and liquidity will vanish as everyone tries to hold on to their cash until they can figure out what's going on.

Every assessment of risk in the financial system is based on the idea that the least risky thing is lending money to the federal government. If that turns out to be much riskier than previously thought, then everything else becomes much riskier too. Business investment will collapse, state and local finances will be crushed, and shockwaves will emanate to a whole range of foreign countries that borrow dollars.
Donald Trump just threatened to cause an unprecedented global financial crisis



originally posted by: burdman30ott6

originally posted by: Profusion


Didn't Trump just describe the essence of bankruptcy?



Isn't the United States, in essence, bankrupt? We have a national debt which exceeds the value of our assets (GDP). That's bankrupt. Should we just keep kicking the can down the road, amassing more and more debt so that we can also amass more and more austerity?


I believe that would be unconstitutional:

Is Trump's idea about renegotiating the national debt unconstitional?

Beyond that, I don't believe the US has any choice in terms of paying its debt just in terms of pragmatism. If the US were to arbitrarily cancel debts, how could any other country ever trust the US again?


originally posted by: UKTruth
It's an interesting approach. If ever there were any entity that was too big to fail, its the USA. Every country in the world would sink into depression if the US economy really tanked. It seems like Trump is going to play hardball in a number of areas on the basis that the US economy is the golden goose for the world.

In essence his plan can be viewed as taking money back from greedy creditors and giving it back to the people. The elite and utterly greedy bankers are not going to like this at all.

What Trump is telling the world is that the USA holds all the cards. He is right.


Trump already had no room for error in order to win the election, these kinds of comments are a death blow. Clinton will be able to use these to destroy Trump in the future.
edit on 6-5-2016 by Profusion because: (no reason given)



posted on May, 6 2016 @ 01:13 PM
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originally posted by: burdman30ott6
a reply to: CynConcepts

Yet print excessive amounts of money is exactly what we did over the past 3 "Quantitative Easings."


According to the International Monetary Fund, the US Federal Reserve, and various other economists, quantitative easing undertaken since the global financial crisis of 2007–08 has mitigated some of the economic problems since the crisis. This is due to the high risk factor of inflation.



posted on May, 6 2016 @ 01:15 PM
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You realize when people do this it destroys their credit. America becoming a deadbeat nation is somehow making America great again?



posted on May, 6 2016 @ 01:17 PM
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a reply to: Profusion

Profusion, you never responded to me in your unconstitutional thread. I had provided you information and source links, showing that it was not unconstitutional. Plus, Trump didn't say he would just ignore debts owed. He said he would negotiate with the creditors. Big difference.



posted on May, 6 2016 @ 01:28 PM
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originally posted by: burdman30ott6
a reply to: FamCore

Let them start a war. We'll finish it and come out of it with another long boom period just as we did following WWII. If the USA started a war over debt, we'd be the bad guys... I must presume if someone else starts a war against the USA over debt, we'd be the good guys.


You know we may get our butts handed to us. The US cannot win a war against the world. Methinks your head has grown too large.



posted on May, 6 2016 @ 01:35 PM
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originally posted by: CynConcepts
a reply to: Profusion

Profusion, you never responded to me in your unconstitutional thread. I had provided you information and source links, showing that it was not unconstitutional. Plus, Trump didn't say he would just ignore debts owed. He said he would negotiate with the creditors. Big difference.


I stopped reading that thread when it started drifting. I replied to your post.


originally posted by: damwel
You realize when people do this it destroys their credit. America becoming a deadbeat nation is somehow making America great again?


I wonder how a 69-year-old man with all of Trump's education and life experience could not already know the contents of this article.

To those who think that Trump is somehow talking about a revolution against bankers, the Federal Reserve was created by an act of Congress and it could be disbanded with an act of Congress. I don't see how Trump's plan discussed in the article linked to above would hurt the power of bankers in any way.

Trump's plan discussed above is so mind-boggling to me, I'm wondering now if he's trying to lose the election.
edit on 6-5-2016 by Profusion because: (no reason given)



posted on May, 6 2016 @ 01:45 PM
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a reply to: CynConcepts

Think about what you just posted. The dollar's value and purchasing power is governed by it's scarcity. The more scarce the dollar is, the lower consumer inflation is thanks to each dollar having greater value. That equates to more purchasing power by holders of dollars. Print more dollars, make them far less scarce, and the value of the dollar deflates, while consumer inflation rises.

The IMF is using the word "inflation" in respect to the dollar's value, NOT the traditional domestic use of the word inflation. QE was an attempt to stave off the US Dollar becoming more valuable, because it would have caused issues with multinationals who suddenly would have been faced with their profits and values going DOWN as measured in US dollars because the value of those dollars, themselves, would have gone up.

QE was a middle finger to the American consumer.



posted on May, 6 2016 @ 01:46 PM
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a reply to: TonyS

Accept the coming major austerity or kick the world's financial institutions square in the nuts and continue to live your life? Which do you believe represents Americans' best interests?



posted on May, 6 2016 @ 01:52 PM
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See heres the thing, this whole thing stinks to high heaven. Its gotta be a set up on a unprecedented scale. Thats the only explanation. If Trump IS elected, then there is your fall guy for the bubble to pop. Whether he's in office or not is irrelevant as it will pop anyway. Just this way they will have a reason to keep the country held together as they have a scape goat.

Can't you guys see? They are looking for a situation to take advantage of for blame sake so the majority of the US doesn't resemble whats left of Yugoslavia. We're talking about a 500 trillion derivative bubble here folks and it'll make all other financial hardships look like happy fun day at madam chows Vietnamese house of massage.



posted on May, 6 2016 @ 01:54 PM
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a reply to: burdman30ott6

Americans will kick nuts......because they'll be damned if someone is going to take away their lifestyle.



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