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0 pointsroenxi11mo ago0 comments

Even that argument is starting to fall apart. What are the theatres where the US is supposed to be able to put on a strong showing? It doesn't seem to be Europe, they've got war on their doorstep and if anyone thinks the US is helping they should reflect on their reasoning. It doesn't seem to be the Middle East, the US has made the region less safe. They're not going to be able to act effectively against China given the trouble Russia has been giving them.

The US can't afford to extract tribute from people. It isn't powerful enough, relatively speaking.

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SideburnsOfDoom11mo ago

> Even that argument is starting to fall apart.

Yes, that's what's happening. They were paying tribute, based on a mutually beneficial status quo. Now they're asking if they should continue to.

AnimalMuppet11mo ago

They weren't (for the most part) paying tribute. They were putting their money somewhere safe - somewhere where the risks of default, inflation, and devaluation were lower than other places.

But I agree, now they're asking if they should continue, because those assumptions are starting to look invalid.

pjc5011mo ago

> What are the theatres where the US is supposed to be able to put on a strong showing? It doesn't seem to be Europe, they've got war on their doorstep and if anyone thinks the US is helping they should reflect on their reasoning

I think you have this backwards: the US was helping considerably, and then got taken over by pro-Russian conspiracy theorists.

But the bond stuff isn't "tribute" or nationalism; remember, it's being made by private sector investors, not national governments. Fairly straightforward calculation: which way is the exchange rate expected to move? Interest rate? Risk of default?

Up till now the US offered moderate interest rates, favourable direction of exchange rate movement, and imperceptible risk of default. There's still no reason to default other than madness and a desire to strap on the suicide vest and become Argentina.

roenxiOP11mo ago

> But the bond stuff isn't "tribute" or nationalism; remember, it's being made by private sector investors, not national governments.

Are you sure about that? Back in 2022 the US Treaury reckoned that most holdings were foreign governments [0] - they had Foreign Official at ~3.9 trillion and foreign total at ~7.5 trillion. That has been shifting towards the private sector since then but the market has heavy sovereign involvement.

> and imperceptible risk of default.

The US clearly has quite a high risk of default - there isn't a reasonable path to them paying the money back. It takes imagination to even come up with scenarios where they try. In real terms they are going to default, in nominal terms there is still a high chance that they call it a default. There is no guarantee that they'll print money for foreigners; it is already going to be farcical claiming that they're not defaulting as they devalue like mad; it is quite possible they won't bother with the act and just do the honest thing.

[0] https://ticdata.treasury.gov/resource-center/data-chart-cent...

pjc5011mo ago

> there isn't a reasonable path to them paying the money back

Indefinite rollover is completely fine! Yes there are problems if the total interest payment gets too large, and there's scope for discussion about that, but there's no hard cutoff, it just becomes more and more uncomfortable.

People saying there will be a default: deadline please. Or is this just a general assumption that mortality is inevitable for states? The UK has never defaulted, for example.

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aa-jv11mo ago

>the US was helping considerably, and then got taken over by pro-Russian conspiracy theorists.

This is such a nonsense conspiracy theory. Anything "non-American" isn't by default pro-Russian, ffs.

Come on people, this nonsense has to die. You can't be that dumb. Nobody believes this excuse any more.

Maybe America is in trouble because Americans are just shit at keeping themselves safe from real harm, and Russia has nothing to do with it.

t420mom11mo ago

The Middle East is less safe because the US made an example of Saddam when he offered to sell oil for Euros instead of US dollars. That's a classic example of an empire ensuring the tribute continues to flow, at least until the current Emperor decides receiving tribute is a bad deal and demands every country in the world stops sending it.

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SideburnsOfDoom11mo ago

> Even that argument is starting to fall apart.

Yes, that's what's happening. They were paying tribute, based on a mutually beneficial status quo. Now they're asking if they should continue to.

AnimalMuppet11mo ago

They weren't (for the most part) paying tribute. They were putting their money somewhere safe - somewhere where the risks of default, inflation, and devaluation were lower than other places.

But I agree, now they're asking if they should continue, because those assumptions are starting to look invalid.

pjc5011mo ago

I think you have this backwards: the US was helping considerably, and then got taken over by pro-Russian conspiracy theorists.

roenxiOP11mo ago

> But the bond stuff isn't "tribute" or nationalism; remember, it's being made by private sector investors, not national governments.

> and imperceptible risk of default.

[0] https://ticdata.treasury.gov/resource-center/data-chart-cent...

pjc5011mo ago

> there isn't a reasonable path to them paying the money back

People saying there will be a default: deadline please. Or is this just a general assumption that mortality is inevitable for states? The UK has never defaulted, for example.

1 more reply

aa-jv11mo ago

>the US was helping considerably, and then got taken over by pro-Russian conspiracy theorists.

This is such a nonsense conspiracy theory. Anything "non-American" isn't by default pro-Russian, ffs.

Come on people, this nonsense has to die. You can't be that dumb. Nobody believes this excuse any more.

Maybe America is in trouble because Americans are just shit at keeping themselves safe from real harm, and Russia has nothing to do with it.

t420mom11mo ago

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