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> as it can simply print dollars. It will never be in formal default (...). The consequence for the US economy won't be pretty though. Argentina tried doing th
by tcgv 2y ago
> as it can simply print dollars. It will never be in formal default (...). The consequence for the US economy won't be pretty though.
Argentina tried doing that, resulting in 100% inflation per month.
- beezlebroxxxxxx 2y agoThat's because, in a blunt sense, no one cares about the Argentinian peso except for (some) Argentinians. Many more people (practically everyone) care about the USD. So long as the US commands dominant global influence (in many senses) then the USD retains a "standard" quality that can be very flexible. Sustained deflation and loss of purchase power is far more dangerous than inflation, so long as you don't slip into hyperinflation. Everyone in Argentina, for instance, just immediately converted their money to USD.
- navigate8310 2y agoThe US can keep printing money, as soon long as the services is offers is purely in USD. The demand cancels out the inflation from printing money by a small margin.
- neilwilson 2y agoExcept Argentine debt is largely in US dollars, so they didnt do that. The US dollar bit is the problem. From the perspective of anybody outside the US the US dollar is a bond - a zero percent bearer bond. Therefore it is nothing more than a bond swap with a change in interest rate and term. The entity “owing” doesn’t change
- 79a6ed87 2y ago>Except Argentine debt is largely in US dollars, so they didnt do that. Exactly, just between a 20 and a 30 percent of our debt is in Argentine pesos. [0] 0: https://www.argentina.gob.ar/economia/finanzas/graficos-deuda/deuda-bruta-por-moneda-en-porcentaje-del-pbi https://www.argentina.gob.ar/economia/finanzas/graficos-deud...