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Business, Economics & Tax Policy 7: Workers of the world unite!

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Re: Business, Economics & Tax Policy 7: Workers of the world unite!

ScoobyDoo said:
What's America going to do when there is no one to trade with anymore? I know. Go bankrupt.
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For the economists out there, what would happen if every foreign government stopped buying US debt, dumped their US dollar reserves, and stopped accepting dollars to denominate transactions?

Would it just create a buying opportunity for private entities and nothing would happen to the US economy? Or would we be well and truly f-cked?
 
Re: Business, Economics & Tax Policy 7: Workers of the world unite!

aparch said:
Lots of prime National Park Land that can be liquidated for dollars on the acre to cover the debt.
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We tried to sell offshore drilling spots recently. It ****ing failed. Epically.
 
ScoobyDoo said:
We tried to sell offshore drilling spots recently. It ****ing failed. Epically.
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84,900,000 Acres of National Park Land x $3,000 low end price per acre as an estimate = $254,700,000,000

Hmmm. Not going to be enough to wipe out the national debt.
 
Re: Business, Economics & Tax Policy 7: Workers of the world unite!

aparch said:
84,900,000 Acres of National Park Land x $3,000 low end price per acre as an estimate = $254,700,000,000

Hmmm. Not going to be enough to wipe out the national debt.
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That ain't ****.
 
Kepler said:
For the economists out there, what would happen if every foreign government stopped buying US debt, dumped their US dollar reserves, and stopped accepting dollars to denominate transactions?

Would it just create a buying opportunity for private entities and nothing would happen to the US economy? Or would we be well and truly f-cked?
Click to expand...

Why would a govt want to throw away their assets? Those $$$s are worth something.

Of course they only cost our govt 30 cents to make $100 bill :D
So however many they want, the treasury will print them up :p
 
Re: Business, Economics & Tax Policy 7: Workers of the world unite!

Kepler said:
For the economists out there, what would happen if every foreign government stopped buying US debt, dumped their US dollar reserves, and stopped accepting dollars to denominate transactions?

Would it just create a buying opportunity for private entities and nothing would happen to the US economy? Or would we be well and truly f-cked?
Click to expand...

First, the debtholders would experience issues with getting a favorable return on their investment. Making a statement against the US by taking such an action would require severe commitment to the cause, to the tune of billions or trillions in lost investment capital.

Second, the USD would tank. With all the US debt in the open market, the USD would have so much supply with so little demand that our currency wouldn't be worth much at all. We would see a lot of inflation as all foreign made goods would skyrocket in price, as would those domestic goods with foreign made parts. Really, inflation would kill the public when it came time to replace any consumer electronics, automobile, or clothing. At the same time, American producers of exported goods would be hog heaven as their goods could reach new consumers - those who couldn't afford these goods in the past. Assuming the foreign debtholders could handle the investment write-off, foreign consumers would be in a much better situation.

Adding to our issues, with the USD being so depressed, a new currency would soon become the international standard, used for trading oil and various other goods on the open markets. That would free up the US to practice a more straightforward monetary policy.
 
Re: Business, Economics & Tax Policy 7: Workers of the world unite!

mookie1995 said:
Why would a govt want to throw away their assets?
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They're not burning them they're selling them off -- turning them into other things of value. The question I'm asking is what would happen if all other governments decided, for whatever reason, that they wanted to get out of US debt and dollars. Let's assume private holders don't necessarily make the same calculation. The conventions of economics still hold, but governments are no longer in the market for US securities.
 
Re: Business, Economics & Tax Policy 7: Workers of the world unite!

St. Clown said:
First, the debtholders would experience issues with getting a favorable return on their investment.
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Is US debt really the only safe harbor on the planet?

If that's true, it doesn't sound like the global economy is very successful.
 
Re: Business, Economics & Tax Policy 7: Workers of the world unite!

St. Clown said:
Making a statement against the US by taking such an action would require severe commitment to the cause, to the tune of billions or trillions in lost investment capital.
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Huh. The US is too big to fail.
 
Re: Business, Economics & Tax Policy 7: Workers of the world unite!

Kepler said:
Is US debt really the only safe harbor on the planet?

If that's true, it doesn't sound like the global economy is very successful.
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No, it's not the only good government debt for foreign nations to invest. There's just so much of it, and we do have a good credit rating. For now. Also, given the size of our economy, nations like China would buy into US debt as a means of greasing the wheels in gaining entry into the US for their own nationals to purchase assets here and start doing business. I don't know how well that works these days as it's more like purchasing specific pols and not US debt.

Kepler said:
Huh. The US is too big to fail.
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Yes, for all intents and purposes, it is.
 
Re: Business, Economics & Tax Policy 7: Workers of the world unite!

Dudes!!!

There is a reason the US is the planets protector :)
 
Re: Business, Economics & Tax Policy 7: Workers of the world unite!

China exists to sell to the US market.

Their factories would grind to a halt if the US was unable to buy.
 
Re: Business, Economics & Tax Policy 7: Workers of the world unite!

mookie1995 said:
China exists to sell to the US market.

Their factories would grind to a halt if the US was unable to buy.
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The Europeans have a long and storied history of buying good made by slave labor.

Maybe the Western Hemisphere is temporary and in 2092 it wink back outs through a wormhole. The Azores are just a couple hundred miles east of Japan. And... begin!
 
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Re: Business, Economics & Tax Policy 7: Workers of the world unite!

Kepler said:
I've never seen FG. After this clip I want to watch all of it in order.
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unofan said:
Like most comedies, Family Guy is hit or miss. There's about a quarter that is poignant and hilarious, about a quarter that completely misses the mark, and about 50 % that's good for a chuckle and not much more.
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But at least they're self-aware.
 
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