3 ms·

Technically, yes. But if you start print money too recklessly, you will trigger inflation and inflation expectations. Your creditors from abroad will either add

Technically, yes. But if you start print money too recklessly, you will trigger inflation and inflation expectations. Your creditors from abroad will either add heavy markup on future USD debt, or ask for debt in different currency. The only reason this doesn't seem like an immediate threat for US is decades of responsible monetary policy that built trust. US definitely can get in a position it won't be able to sell debt in its own currency.

aphextron 8y ago
>The only reason this doesn't seem like an immediate threat for US is decades of responsible monetary policy that built trust. US definitely can get in a position it won't be able to sell debt in its own currency. I think this line of reasoning is absolutely valid in a purely theoretical framework, where there is an endless supply of possible creditors and perfect market competition. But we live on planet earth, and if you look at the Realpolitik of global trade, the US is uniquely situated to dominate markets no matter what. We have more fresh water than the rest of the planet combined, and more arable land than China or India. It's too productive of an economy, with too many fundamental geographical advantages that position it above any other political entity in the world, that it's impossible to imagine a scenario short of nuclear apocalypse or total political breakdown where the US cannot repay its' debts.