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That's not particularly impressive. Anyone can take out a new loan to cover an old loan.
by arcastroe 3y ago
That's not particularly impressive. Anyone can take out a new loan to cover an old loan.
- whateveracct 3y agoActually, people who give out loans tend to give them out to people who they think can pay them back. You or I can't just stack loans for decades. Fundamentally due to interest - you have to pay back people more than they gave you. So just stacking loans to pay loans isn't sustainable. And the US observably does way more with the "loans" they take out than just pay back other loans. Put another way - if you buy a T-Bill (or other US-backed security aka a source of this debt), what is your confidence that you will get paid on time? I'm assuming very high. But if the US's debt was unsustainable, at some point the house of cards has to come crashing down, right?