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

a reply to: Profusion

Trump's plan discussed above is so mind-boggling to me, I'm wondering now if he's trying to lose the election.

If anything this will help Trump. You have to remember the average American is pretty much ignorant when it comes the national debt. But hey nobody can default on a loan like Trump. He even cried that the crash was an act of God to default on a multi million dollar loan.

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.

Really - what's the debt again? Seems like those that created the debt should probably stay quiet on the subject and let others clean up their mess.

originally posted by: buster2010
a reply to: Profusion

Trump's plan discussed above is so mind-boggling to me, I'm wondering now if he's trying to lose the election.

If anything this will help Trump. You have to remember the average American is pretty much ignorant when it comes the national debt. But hey nobody can default on a loan like Trump. He even cried that the crash was an act of God to default on a multi million dollar loan.

I think this time he's really gone over the edge in such a dramatic way, it's left a lot of people speechless.

“With statements like that it shows that Trump might be better suited to be the leader of Zimbabwe,” Mr Myrow said.

“When you are dealing with the delicate world of international economics and US debt obligations, market participants parse every word carefully and it doesn’t lend itself well to policy by Twitter.”

...

“You can’t make sense of this,” said Justin Wolfers, a professor of economics and public policy at the University of Michigan. “You cannot simultaneously propose massive spending increases and massive tax cuts and a balanced budget.”
Trump’s US debt comments raise eyebrows

Trump's only going to be left with die-hards by the time this is over. Six more months until the election and goodness knows how many more insane comments like that we're going to get.

I'm starting to think the Democratic party is a lock to win the presidency.

originally posted by: UKTruth

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.

Really - what's the debt again? Seems like those that created the debt should probably stay quiet on the subject and let others clean up their mess.

Look at the comments by the experts in the article above. Here's another example:

Trump's Fed position befits a banana republic

Trump isn't going to win on issues with these kinds of ideas. What's he got left?

a reply to: Profusion

The experts? Oh those people... right.
I've heard those guys before... ones that said things like 'the age of boom and bust is over' - that was just before the last crash, after which they said they'd use this new information to make their models better. Got to laugh.

Economic models are theories - often proven wrong. For every expert who says one thing, another will line up to disagree.

a reply to: Profusion

"I would borrow, knowing that if the economy crashed, you could make a deal," Trump said. "And if the economy was good, it was good. So therefore, you can't lose."

And this is bad, why? He's talking about going all-in. People end up working more, producing more, exporting more, buying more and the economy grows. If the world hits a tipping point, everybody crashes and financially it's an even playing field. If the crash comes, every country's credit rating is in the cropper so who cares. It is a win-win strategy.

I guess some people just don't like the idea because it's Trump's idea.

Cheers - Dave

originally posted by: bobs_uruncle
a reply to: Profusion

"I would borrow, knowing that if the economy crashed, you could make a deal," Trump said. "And if the economy was good, it was good. So therefore, you can't lose."

And this is bad, why? He's talking about going all-in. People end up working more, producing more, exporting more, buying more and the economy grows. If the world hits a tipping point, everybody crashes and financially it's an even playing field. If the crash comes, every country's credit rating is in the cropper so who cares. It is a win-win strategy.

I guess some people just don't like the idea because it's Trump's idea.

Cheers - Dave

The experts and media hate it for one reason - it takes from creditors and gives to people. in other words the exact reverse of the last 100 years.

Well maybe more than one reason - you're right, it's Trump's idea.

originally posted by: dawnstar
a reply to: ketsuko

no, but you do realize that some of those who get from the gov't are workers, and the companies they work for get a boost from the gov't giving also... since if the gov't didn't give, they would either have to give them more or some of those people would be in the same spot as this man.

a simple chart displaying the disparity of the income tells us where the money went to. when they are willing to sacrifice, then the gov't has a right to talk to the rest of us about sacrifice. they're not using that money to create jobs in this country, they are using it to gamble in the investment markets, move companies overseas, and kill off competitors here at home. I don't care how much the rest of us sacrifice, as long as they are allowed and enabled to do this, there is nothing that is going to improve things.

This is a real world, bi partisan example that makes sense.

I'll give it to Donald on this one - in theory, I have to agree that this approach kind of makes sense. In the end though, I find it hilarious that politicians even discuss "solving" the US debt problem... The world's economy died the moment Wilson signed the Fed into existence; and Tricky Dick Nixon, single-handedly destroying the remnants of the US Dollar's gold standard, was the box that it was buried in. Yes, the US owes other countries A LOT of money; more importantly though, the United States is also indebted to the corporation that funds it. Amazingly - this corporation never bounces a check! The Federal Reserve has the ultimate racket going...its (conveniently undisclosed) shareholders make money by keeping the US in perpetual debt. And I don't think these unknown shareholders are going to want to STOP making more and more money any time soon - no matter what Donny, or any other politician, has in their talking points. In my humble opinion, there is zero discussion beyond that. The US can't solve a problem which is insolvable!

Creditors accept less than what you owe almost every single time you offer.

The full amount is usually based on interest which is literally THOUSANDS of percentage points past actual costs, plus 'fees' tacked on, etc.

Insurance companies and creditors can take a 50% cut in the total they state owed, and still profit, over true cost and services.

What Trump is suggesting is a massive collective bargaining on behalf of a "Class". Like a "Class" settlement. Some companies which are struggling MAY welcome instant liquidity to the tune of Billions in lump settlements, especially ones needing it.

Other though may not, if they find they profit more in the long term off of higher interest rates, etc.

Some of these guys operate at 25% rates over null. And there is say 15% additional wiggle room over "wholesale" for services. Making an average of 40% for 'negotiation', for some to still be in the 'black' on ledgers. (Example)

Some others operate with slimmer ROI for risk, so a settlement % might be much smaller.

But overall, almost every 'creditor' or insurance house will negotiate lump settlements...depending on how much liquidity they can accept or invite

a reply to: BatheInTheFountain

That may be true of private debt but it is not the same with government debt. For a start they already have liquidity as bonds can be bought and sold at market. There is also no risk to the creditor as the US never needs to default on its debt.

The costs argument doesn't hold up either, there is no admin or paper work involve in government debt. The US treasury does not have to fill in a loan application when it wants to borrow money.

The good news as that Trump has replaced/retracted/clarified his statement to point out that the government does not need to renegotiate its debt as it can always borrow more. For a change he is absolutely correct.

The even better news is that government debt is private sector savings, Worrying about the debt is like worrying that people have too much money. There may be occasions when people do have too much money in an economy but I don't think the US is anywhere near that position at the moment.

I don't care how a person wants to do it, but, out of ALL of the candidates he is the only one who is EVEN SUGGESTING HOW to start to bring the country back in order

(Emphasis added)

That's really the kicker.

For example, early in the election, politicians weren't going to touch the illegal immigration issue with a 40' pole, until Trump forced the issue. Here's a place we're simply bleeding money as a nation, but nobody would touch it for fear of losing Latino and Asian votes.

That fact that he isn't afraid to address such issues, regardless of fallout, is a major part of his appeal as a candidate.

originally posted by: Gazrok

I don't care how a person wants to do it, but, out of ALL of the candidates he is the only one who is EVEN SUGGESTING HOW to start to bring the country back in order

(Emphasis added)

That's really the kicker.

For example, early in the election, politicians weren't going to touch the illegal immigration issue with a 40' pole, until Trump forced the issue. Here's a place we're simply bleeding money as a nation, but nobody would touch it for fear of losing Latino and Asian votes.

That fact that he isn't afraid to address such issues, regardless of fallout, is a major part of his appeal as a candidate.

Exactly - the media and so called experts have taken the role of cycling through every idea and stating 'no, that won't work, it's stupid'.

I don't see others willing to really raise their heads above the parapet and open themselves up to critique. Where are their ideas? If you talk openly about your thoughts it seems that people want to tell you all the reasons why you are wrong instead of engaging in discussion to hone ideas into action plans. It's a common problem with the world, not just politics.