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> So money can't be saved without being borrowed, and the USG acts as a safe borrower of last resort (because the world has lots of savings needs ATM). Money c

> So money can't be saved without being borrowed, and the USG acts as a safe borrower of last resort (because the world has lots of savings needs ATM). Money can be invested in assets other than savings accounts, e.g. the share market. Government borrowing pushes up interest rates attracting saving that might otherwise go into investments that generate returns. Government spending using debt isn’t like saving for retirement, it’s borrowing for retirement and leaving the debt to your kids.

seanmcdirmid 3y ago
> Money can be invested in assets other than savings accounts, e.g. the share market. Yes, that's why we have stock market bubbles and housing bubbles. Our 401Ks are heavily invested in index funds, while the rest of our savings are usually invested heavily in real estate (which is one reason why our housing prices are rising so quickly!). Now imagine leaning in on those 10 times more heavily than we do today... > it’s borrowing for retirement and leaving the debt to your kids. The point is that there is a massive demand for savings now, that money would have to be lent out to someone no matter what, and dollars are safe because US treasuries can soak up billions instantly with some sort of interest rate that will be paid back. You can't just say "oh, we should stop borrowing that money" unless you have a better idea of where to it can go.
jfengel 3y ago
Who leave it to their kids, who leave it to their kids. Individual humans retire. Corporations and governments don't. The latter can roll over debt indefinitely. There is never any reason to pay it off. The only limit is whether they can afford the interest, which is a function of how well they apply the spending to ensure income. It's very different from a household budget and comparisons easily mislead.
- nradov 3y ago
  On a longer time scale, most corporations eventually go bankrupt. Most countries eventually undergo some kind of violent transition in which the new government repudiates old debts. This is a form of "retirement", but it's harder to predict those events than with individual human retirements.

seanmcdirmid 3y ago

> Money can be invested in assets other than savings accounts, e.g. the share market. Yes, that's why we have stock market bubbles and housing bubbles. Our 401Ks are heavily invested in index funds, while the rest of our savings are usually invested heavily in real estate (which is one reason why our housing prices are rising so quickly!). Now imagine leaning in on those 10 times more heavily than we do today... > it’s borrowing for retirement and leaving the debt to your kids. The point is that there is a massive demand for savings now, that money would have to be lent out to someone no matter what, and dollars are safe because US treasuries can soak up billions instantly with some sort of interest rate that will be paid back. You can't just say "oh, we should stop borrowing that money" unless you have a better idea of where to it can go.

jfengel 3y ago

Who leave it to their kids, who leave it to their kids. Individual humans retire. Corporations and governments don't. The latter can roll over debt indefinitely. There is never any reason to pay it off. The only limit is whether they can afford the interest, which is a function of how well they apply the spending to ensure income. It's very different from a household budget and comparisons easily mislead.

nradov 3y ago
On a longer time scale, most corporations eventually go bankrupt. Most countries eventually undergo some kind of violent transition in which the new government repudiates old debts. This is a form of "retirement", but it's harder to predict those events than with individual human retirements.