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I can’t reply to your last reply for some reason, so I’m replying here. I’ll read the article you linked to, but I don’t expect anything other than more econoba
by DATACOMMANDER 7y ago
I can’t reply to your last reply for some reason, so I’m replying here. I’ll read the article you linked to, but I don’t expect anything other than more econobabble and fear-mongering.
If a country’s entire economic system is based on a stupid assumption—in this case, that a sovereign nation will never default on its debt—then it ought to collapse. Still, I don’t believe that collapse would actually occur. I think that a lot of people would lose a significant amount of money and be quite upset. And then, the next day, the sun would rise, and people wouldn’t be starving in the streets, and life would generally go on.
- joshuafkon 7y agoHopefully you’re right. But I think if you look at how the people of Greece have already suffered since almost having a sovereign debt crisis you’ll agree the potential is there for it to be quite bad in Italy. https://www.nytimes.com/interactive/2015/07/09/business/international/is-greece-worse-off-than-the-us-during-the-great-depression.html?mtrref=www.google.com&gwh=4DDBD9724BFDA10B3F4DABE72365B654&gwt=pay&assetType=REGIWALL https://www.nytimes.com/interactive/2015/07/09/business/inte...
- DATACOMMANDER 7y agoI’ll read both of those articles later; they’re behind a paywall. I’m not an economist, and I’m open to being shown that I’m wrong, but I still think that if Italy were to default on its debt, there would only be two inevitable consequences: French and German banks would lose a lot of money, and Italy would have serious trouble borrowing at a reasonable rate in the future. I don’t see how anyone could call either of those outcomes “catastrophic” with a straight face. But I can easily see why those who stand to lose a lot of money would want the public to believe that a default would be catastrophic.