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0 pointsyardie2y ago0 comments

The libertarians keep saying this. Yet the US continues to sell bonds to international investors who never question if the credit line is overextended. They continue to use the economic model they learned in high school economics class to a more complex economic model that is designed by and for a hegemony.

The US has an almost unlimited credit line because investors are clamoring for it. It's literally the best, most stable investment going right now. They wanted it to be the EU and it has not been. They wanted it to be BRICs and that is a flaming dumpster fire right now. Very soon, they will state Africa is a better bet than the US. It's a young, dynamic economy; the very opposite of stable.

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somenameforme2y ago

The US debt is $32.3 trillion, and skyrocketing. [1] Total debt held by foreign/international investors is $7.3 trillion, and declining (both in absolute $ as well as percent). [2] The largest single holder is the Federal Reserve. Other holders are disproportionately made up of domestic organizations (like pension or mutual funds) which will collapse when the USD collapses, essentially regardless of hedging efforts, so they have no motivation to consider risk of collapse in their evaluations.

[1] - https://fred.stlouisfed.org/series/GFDEBTN

[2] - https://fred.stlouisfed.org/series/HBFIGDQ188S

mwbajor2y ago

Could this not change in an instant though?

"The US has an almost unlimited credit line because investors are clamoring for it. It's literally the best, most stable investment going right now. "

Its hubris like this that worries people, not partisanship.

amanaplanacanal2y ago

What’s the alternative though? There has to be one for the dollar to fall.

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