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If America Get too broke to continue paying China, What will happen?

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posted on Aug, 13 2011 @ 11:34 PM
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Originally posted by Rockdisjoint
reply to post by SupersonicSerpent
 



Your wrong the fed reserve is totally private, watch this

They are wrong or intentionally lying, the U.S ``central bank`` is not private.

If it was private how come I can't open up my own money printing factory?


because you are not protected by the Federal Reserve Act, only the Federal Reserve is.

Check here.




What would be a prison offense for a normal citizen was rendered legal for the government by the Federal Reserve Act. This was not a popular piece of legislation. In fact the Democrats had campaigned in 1912 on a platform of rejection of the creation of a private bank in charge of a fiat money system. Nevertheless, on December 23, 1913, taking advantage of the absence of congressmen opposed to the creation of a fiat monetary system during the Christmas break, the Federal Reserve Act was passed.




posted on Aug, 13 2011 @ 11:37 PM
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reply to post by KicknAndScreamin
 

Exactly, pretty much proving that the Fed is a govt agency. When a govt creates a monopoly, that monopoly is an arm of that govt.

edit on 13-8-2011 by Rockdisjoint because: (no reason given)



posted on Aug, 13 2011 @ 11:46 PM
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reply to post by Rockdisjoint
 


monetary.org...



It will be clear from the following points that the Fed is definitely not part of the US Government:
* The Fed is not organized within the Executive, Legislative or Judicial branches of our government.
* Who pays the Fed’s bills and determines its budget? Not any part of our government. The Fed gets its funding from its own specially privileged operations. The Fed Board determines Fed budgets.
* Who monitors and oversees Fed activities? Again the Fed itself. While some important elements of proper auditing have taken place, there has not yet been a comprehensive independent audit, by the Government Accountability Office as proposed in a recent letter from Ralph Nader to new Fed Chairman Ben Bernanke, calling for greater monetary transparency.
* Federal Reserve Employees are not part of the US Civil Service System and are not covered by government employees’ health insurance or pension programs. Who does the hiring and firing? Except for the highly publicized Chairman and 7 member Washington Board, this is in private, unelected hands.
* Federal Reserve Banks are not listed as government organizations by the telephone companies, a small but telling fact.


I don't know man. Can congress dissolve the Fed? Yes, technically they could. But in reality I just don't think it could happen. Congressmen aren't bankers. They don't know how to run a monetary system. It would all come tumbling down if they actually did dissolve the Fed and everyone knows it. It's double jeopardy. Lose-Lose situation.



posted on Aug, 13 2011 @ 11:47 PM
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I could be insanely wrong here but i believe that the "debt" that we owe china isn't an actual loan like when you get when you buy a car or house, i'm pretty sure that we are selling them are us treasury bonds which work a bit differently. I do know for a fact that our credit rating is what determines the price of treasury bonds and the amount that the gov can sell...

S&P didn't drop our credit score from 750 down to 680, they just did an analysis of our national debt/income ratio and factored in the volatility of our economy and determined what purchasers could expect after a certain number of bonds are issued. we can sell more than they recommend but at that point the risk of inability to repay would give investors grounds to ask for huge returns or "interest."

If you think that we will pull through this rough patch as a nation and that our monetary system will last, buy the hell outa some treasury bond calls on margin and get filthy rich off of this recession... plus it keeps them from borrowing from china because they are borrowing from you.

like i said, i could be mistaken but my minor in business economics makes me somewhat credible on such matters, but if i'm wrong could someone please correct me so that i'm not walking around talking nonsense

edit on 13-8-2011 by TheThirdAdam because: (no reason given)



posted on Aug, 13 2011 @ 11:52 PM
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reply to post by guessing
 


I'd have to agree with you on that one! I remember a little while back a post about how China was trying to buy a square of land in the US where they had plans on opening up giant factories and creating a community. Basically, a country inside of a country. However, I think that if land was to be given for payment, it would most likely end up being Alaska or Hawaii.



posted on Aug, 14 2011 @ 12:01 AM
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reply to post by ZeroReady
 



They don't know how to run a monetary system.

Neither does Bernanke, but that doesn't stop him from trying. Honestly though, our monetary system doesn't need any running or control -- the market can handle that without a central bank.



It would all come tumbling down if they actually did dissolve the Fed and everyone knows it.

That would depend on how they did it. If they simply subjected the Fed to the same laws regarding counterfeiting and fraud that we are subjected to, nothing would come tumbling down. In fact -- doing that will give the U.S a great chance to rebuild its economy.



posted on Aug, 14 2011 @ 12:06 AM
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Boxer Rebellion part II.

Really, read about the Boxer Rebellion.

Russia, Europe, and the US gang banged on China and made them our slaves...forced them to pay something crazy like half a million pounds of silver for "reparations". And that was at the turn of 1900.

History just repeats itself. China's about to get gang banged......or will the world use America as the gang bang this time? Hmmm.....haven't put much thought into that.



posted on Aug, 14 2011 @ 12:13 AM
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reply to post by Rockdisjoint
 




Neither does Bernanke, but that doesn't stop him from trying.


Ha. All arguing aside, that's a good one man. I can dig it. And I will agree that the market probably could, and would, take care of itself. Only example I can think of where the law of supply and demand seems to be failing is education/college tuition.

I've wondered what it would be like if congress actually had the power to "coin money." I think the original intent of the Constitution was to actually have only coinage - pieces of precious/semi-precious metal not only representing wealth but being worth something as well. Legal tender just doesn't do it for me.



posted on Aug, 14 2011 @ 12:20 AM
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Maybe america should, Lay low for a while, They are always, attacking other country's physically, or mentally, Maybe its time you wind your necks in, More wars is going to create more debt,you let Britain and France go to work on Libya, this time around though which was quite smart.

except i,m from Britain lol, And we will just generate more debt, and more unwanted attention, i really don't see the point in been in the middle east, they clearly don't want us there,

we should spend money on defending our own countrys, against them, if attacks ever do happen rather than, attacking them. when they have done nothing wrong, the Whole innocent till proven guilty, was forgotten during the invasion of iraq



posted on Aug, 14 2011 @ 12:34 AM
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Originally posted by TheThirdAdam
I could be insanely wrong here but i believe that the "debt" that we owe china isn't an actual loan like when you get when you buy a car or house, i'm pretty sure that we are selling them are us treasury bonds which work a bit differently. I do know for a fact that our credit rating is what determines the price of treasury bonds and the amount that the gov can sell...

S&P didn't drop our credit score from 750 down to 680, they just did an analysis of our national debt/income ratio and factored in the volatility of our economy and determined what purchasers could expect after a certain number of bonds are issued. we can sell more than they recommend but at that point the risk of inability to repay would give investors grounds to ask for huge returns or "interest."

If you think that we will pull through this rough patch as a nation and that our monetary system will last, buy the hell outa some treasury bond calls on margin and get filthy rich off of this recession... plus it keeps them from borrowing from china because they are borrowing from you.

like i said, i could be mistaken but my minor in business economics makes me somewhat credible on such matters, but if i'm wrong could someone please correct me so that i'm not walking around talking nonsense


So to answer your original question "what would happen if we didn't pay?"

China would be left holding a piece of worthless paper. They could do any number of things from consider it a declaration of war which is highly unlikely considering how much a war with us would cost them and that they had just taken a massive financial blow by having trillions in assets rendered useless. Or they could settle for a lesser payment from the US but it would only happen if they were in an extreme financial emergency. The most likely to happen is that they would just hold their bonds and let them continue accumulate compounded interest.

China is not who you should worry about though, they rely on us heavily and are not out to destroy the us because they know that their fates are tied together. If we go down, they will be right behind us. The ones that you have to watch are quantum fund geo. soros' of the world who buy vast amounts of securities bonds on margin and then short sell them for huge profits all the while leaving our financial system in ruins.

No one man could do that you say? He already did this to brittan's royal bank and the pound, leaving the brits no choice but adopt the euro...

Bottom line- Get rid of the idea that we are making monthly installments towards our debt in china, we aren't paying on a mortgage here. The scary truth is that they could cash in anytime they want and the maturity date on those bonds is really just a guideline



posted on Aug, 14 2011 @ 12:46 AM
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The Fed is a part of the govt. So when the Fed prints, it is the govt printing money.



'The Fed' (Federal Reserve) is a privately owned institution,
which our government requests LOANS from, to which
Federal Reserve Notes are printed.
Interest is charged to these notes and the government must
pay it back. How do they do that? By having the fed print more?
Which has more interest charged to it?

So... we print money on loan, and have to pay back more than was printed?
Forcing us to print more? and pay MORE interest on that? How has this lasted so long?



posted on Aug, 14 2011 @ 12:47 AM
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reply to post by Rockdisjoint
 


It is impossible.

That is why it's failing!!!



posted on Aug, 14 2011 @ 12:48 AM
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Originally posted by guessing
China will just call in the debt.

They will take land owned by the USA.



There is an awful lot of land allocated
as 'National Parks' and what not...



posted on Aug, 14 2011 @ 12:50 AM
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Originally posted by SupersonicSerpent
reply to post by morder1
 


Maybe your country could stop starting wars and invading every tom dick and harry, and spending 3 billion a pop on stealth bombers would be a great start


This is my country too. I assume you are not American...

Regardless. I agree with you. on this and other statements you have made.


I am an American, and I want my nation back!!!



posted on Aug, 14 2011 @ 12:57 AM
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Congressmen aren't bankers. They don't know how to run a monetary system. It would all come tumbling down if they actually did dissolve the Fed and everyone knows it. It's double jeopardy. Lose-Lose situation.


Yes! It is!!!



posted on Aug, 14 2011 @ 01:00 AM
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Originally posted by HardyWhite

'The Fed' (Federal Reserve) is a privately owned institution,
which our government requests LOANS from, to which
Federal Reserve Notes are printed.
Interest is charged to these notes and the government must
pay it back. How do they do that? By having the fed print more?
Which has more interest charged to it?

So... we print money on loan, and have to pay back more than was printed?
Forcing us to print more? and pay MORE interest on that? How has this lasted so long?


It's more than double the interest if you also acount for the inflation that this causes, by the time you begin to pay back the loan the money that you initially borrowed is worth considerably less in terms of purchasing power.

They would get just as good of loan at their nearest pawn shop or payday cash advance store...



posted on Aug, 14 2011 @ 01:04 AM
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Originally posted by Rockdisjoint

You can not maintain a monopoly over the creation of legal tender and be a private bank. That's simply impossible.
edit on 13-8-2011 by Rockdisjoint because: (no reason given)


YOU are wrong.The fed is privately owned.

www.globalresearch.ca...
www.factcheck.org...

By 12 private banks! Not the government.



posted on Aug, 14 2011 @ 09:01 AM
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Originally posted by gimme_some_truth

Originally posted by Rockdisjoint

You can not maintain a monopoly over the creation of legal tender and be a private bank. That's simply impossible.
edit on 13-8-2011 by Rockdisjoint because: (no reason given)


YOU are wrong.The fed is privately owned.

www.globalresearch.ca...
www.factcheck.org...

By 12 private banks! Not the government.

Um, no it's not private.

How come the president must pick the board of governors and how come they all must be approved by the senate? That isn't how a private bank operates. A private bank would also want to make profit, how come the Fed returns 95% [it uses the other 5% for operating cost] of its profit back to the U.S treasury?

If this bank was truly private -- operating like this, it would have went out of business a long time ago.
edit on 14-8-2011 by Rockdisjoint because: (no reason given)



posted on Aug, 14 2011 @ 09:42 AM
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reply to post by SupersonicSerpent
 


Nothing. The Chinese will just buy US debt at a higher interest rate. If they were to "call" the debt, the US would threaten them on the trade level, to impose large tarrifs on Chinese goods, which would likely cause other countries to do the same. China needs the US more than the US needs China. One threat of a tarrif and the Chinese would shut up. Absent the US market and the cash flow that represents, the Chinese would have a revolution.

The Chinese economy is in a shambles, held up by currency manipulation. Their housing market is way over valued, their infrastructure is a disaster, poverty levels massive. China is a mess. Its about time for the world to deal effectively with the Chinese and force them to play an even handed international trade game. Of all of the American folks in politics today, the only one who speaks reasonably and honestly about the Chinese is Trump.



posted on Aug, 14 2011 @ 09:52 AM
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The op has asked a valid question as to what happens if the US defaults on its debt. It is a valid question and from what can be found out on the internet the following would happen:
The US defaults on its debt to pay what it has borrowed. This would lead to a spiral of events that would not be good for either the US or the rest of the world.
Some of the debt may be forgiven, but highly unlikely as the US is too well developed and therefore not entitled to this kind of forgiveness. As a result investors in the US would pull out, no country would want to be tied to the US for any reason, and any money that would be coming in, would cease. The US would not be able to borrow on the open market, and if it did, the rates would be higher than normal. The economy would continue to slide further down, as the value of the dollar would also tank. The federal government would be forced to make cuts, deeper than it has already, and cutting spending on all fronts and areas. While this would make some happy, ultimately it would affect the rest of the country, as there would be more people who are unemployed and greater competition for employment than there is now. People could lose what aid they receive now and thus it continues to keep going down, the country slides from recession into a depression, further complicating matters, it gets worse, as there would be economic chaos for years. The country would be isolated economically, with very few willing to lend money and even the IMF would refuse to lend the US any money. This in turn, as the US dollar declines, would affect the rest of the world, as oil is traded in dollars, and the oil producing countries would take a major hit, thus impacting all other countries. There would be a global recession and possibly depression around the world, while the leaders thought about how to change that. Rioting and looting would possibly occur, and people would not be in a good way. Once the world stabilized, they would have to come up with a new plan, probably a new world currency to be used and traded, where not one country would have that much power or backing, this would effectively remove the US from a major part of the world stage, with the possible forgiveness towards other countries, when it comes to their debt. Countries would demand and probably get punitive actions against the US for years to come.
The government would shrink and the people would be forced to start to do for themselves again. Business would have to start over and begin to rebuild itself back up.

Much of this can be seen by looking at other countries that have defaulted before, like Argintina.




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