LogFAQs > #926747347

darkknight109 posted...

My standing debt to the government is presently zero

Your standing loan to the government is zero too. You are the government's property, you're not relevant.

darkknight109 posted...

Which is alarming for different reasons, as it makes it much harder for governments to secure capital, given that they are basically saying "Pay us for the privilege of you loaning us money." This can, and historically has, driven panic and market flight.

Let me put it this way; you don't get to ask your bank for negative interest, you owe them, you have no position of worth to trade against. Governments give money to eachother (even with interest payments) because their existence cancels out the value the debt. The number doesn't mean anything significant beyond how much a country is worthwhile to keep around.

darkknight109 posted...

That's not debt.

Government debt isn't debt in the same way. While everything traded is quantified, the debt count is just a way of countries of crying "You owe me bro!" whenever things aren't going right. Realistically nobody can or will enforce these debts as their economic relationships are too valuable.

darkknight109 posted...

Countries can hold as much debt as they want, but the interest payments choke out healthy economic growth as it's basically a regressive, upwards distribution of wealth, as tax is taken from all and given to sovereign debt holders, who are disproportionately rich, instead of consumers, whose spending drives the economy.

Do you really believe America's debt to China goes to the 1% and not China's operations? China lends money to America, America funds businesses that improve the country's GDP. When GDP increases, more trade is done with China and China's GDP improves. The more the trade helps China, the less China charges in interest. When trade value exceeds loan value, China offers negative interest to assist growth.

The debt isn't paid in cash, it's paid in relations. Everybody in the US benefits when the US has enhanced GDP and this pseudo-guaranteed trade keeps China afloat too. It's not debt in the real world, it only exists on paper.

darkknight109 posted...

And a country the size and importance of the US defaulting on its payments would cause an immediate market crash that would dwarf the scale and impact of anything in the last 100 years.

That's a problem with the stock market, not the debt. Ultimately negative interest is offered because people act ridiculously to things they don't understand. The US will never be charged what they can't pay because it is not sensible to harm a country that props up your economy.

LinkPizza posted...

Making them pay more isnt going to do anything to the company because theyll raise their prices so the tax wont affect them as much. Which make prices possibly skyrocket for consumers.

Market forces. In a business where free market economics work naturally, spiking the price to offset costs kills off desirability and sales. It's more profitable to take the hit when people can't/won't pay more.
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Doctor Foxx posted...
The demonizing of soy has a lot to do with xenophobic ideas.