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mud said:
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The Fed has painted itself into a corner. The Congress has spent damn near 7 trillion while we slept with a blank fiscal operating charge card going into 2023 without a budget to speak of. Thats at 0% interest.

Real inflation is bordering at 10% already. CPI etc is diddled down to 5.9 something which is what SSA and VA and so on will pay on next month every month.

The last time we had this situation was 1980. The Fed raised the minimum rate to 20% flat. That stopped the inflation essentially overnight. Yes you were paying 15% or more on car loans or 19% on housing plus a 90% tax rate and no one went anywhere at all for a couple of years. Parts of our banking system particularly the old remmants of the obsolete savings and loan banking failed entirely.

Imagine if Uncle Sam had a debt payment based on 20% inflation? Instead of zero? Well on 30 trillion you are looking at a number that will take us 45 years of income at 5T a year annually to pay one quarters worth of interest due against 30T. My computer actually tried to calculate that high and the figures are iffy because I had to drop something like six zeros.

If figures got so bad and numbers grostesque high to where you simply ditched all those zeros to turn say 30T into 30 US Dollars? Whoo hoo.
 
mud said:
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Russia is debt free essentially. Whatever debts against their treasury can be covered with a small written check draft in 2 minutes. Paid. Everything else is cash, coal, timber, ores, etc etc etc etc.

IF we had to cover all of our debt today? We will not exist as a Country until its reorganized. We have been a Corporation essentially since the default of about 1873 or so. HOWEVER there is probably enough Real estate, 401k and other holdings in cash or like cash that they can draw on across the board. The people will no longer own any of that. Poof.

Some say the fort knox gold will do it? Not at the current valuation of Spot Gold against the Dollar. 8400 tons good for a few billion dollars at current spot gold at best. It will have to be matched to a M6 supply of all dollars. Which will instantly enrich millions who have a few gold coins or bars at home. THEY probably can become net creditors able to buy the debt of America at that point.

The sad part is that gold will be much much much more useful as a wartime metal rather than for money because there will not be anymore coming in.
 
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