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KamaAina

(78,249 posts)
Fri May 6, 2016, 05:18 PM May 2016

Donald Trump just threatened to cause an unprecedented global financial crisis

http://www.vox.com/2016/5/6/11607464/trump-haircut-default-debt

In an interview Thursday on CNBC, Donald Trump broke with tired clichés about the evils of federal debt accumulation. "I am the king of debt," he said. "I love debt. I love playing with it."

But he replaced fearmongering about debt with an even more alarming notion — a bankruptcy of the United States federal government that would incinerate the world economy.

"I would borrow, knowing that if the economy crashed, you could make a deal," Trump said. "And if the economy was good, it was good. So therefore, you can't lose."

With his statement, Trump not only revealed a dangerous ignorance about the operation of the national monetary system and the global economic order, but also offered a brilliant case study in the profound risks of attempting to apply the logic of a private business enterprise to the task of running the United States of America.


22 replies = new reply since forum marked as read
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Donald Trump just threatened to cause an unprecedented global financial crisis (Original Post) KamaAina May 2016 OP
Right now there are GOP elites calling Obama to tell him to Gomez163 May 2016 #1
Guess he is not in favor of a return to Glass Stegal? gordianot May 2016 #2
For him, it's like running for President of the Student Council in High School. HuckleB May 2016 #3
He would never have won a high school election KamaAina May 2016 #6
LOL! HuckleB May 2016 #7
A national government is not like a corporation, where they do play with debt. Agnosticsherbet May 2016 #4
Some men just want to watch the world burn MowCowWhoHow III May 2016 #5
To me that's the big difference between Bernie and Donald. Trump wants to burn the world down. pampango May 2016 #22
This part: Ilsa May 2016 #8
Meanwhile,in a state far far away,Sanders supporters broke up a rally for The Democratic Frontrunner Hekate May 2016 #9
Yes. retrowire May 2016 #12
The Dem primary is 99.999% decided barring some really shocking events. Zynx May 2016 #14
99.999? retrowire May 2016 #15
How does he get 65% of the remaining delegates? His average vote share in primaries so far is about Zynx May 2016 #16
I suspect that some people do not find the "math" @ Democratic Underground funny at all;... Jeffersons Ghost May 2016 #20
Total bull feathers. The mostly Latino crowd included **some** Bernie supporters... FailureToCommunicate May 2016 #17
What a complete and utter nightmare. smirkymonkey May 2016 #10
All he has to do is get elected. He will then be the face of the full faith and credit of the United jtuck004 May 2016 #11
The folks at VOX are not too knoweldgable of this nadinbrzezinski May 2016 #13
Oh no! we could end up like Greece with banksters in control of everything elmac May 2016 #18
We have a fiat currency. We use it to pay those bills by giving them a credit in American jtuck004 May 2016 #19
Scary stuff Yo_Mama_Been_Loggin May 2016 #21

HuckleB

(35,773 posts)
3. For him, it's like running for President of the Student Council in High School.
Fri May 6, 2016, 05:26 PM
May 2016

He really does not live in the real world.

HuckleB

(35,773 posts)
7. LOL!
Fri May 6, 2016, 05:49 PM
May 2016

One of our current mayoral candidates' anecdotes is how he lost the school treasurer job he held his freshman year, because he gave a detailed policy speech while his opponent ran into the auditorium in the school mascot uniform, tossing candy to everyone, and promised free stuff to everyone. Hmm. I don't think that has anything to do with anything, but...

Agnosticsherbet

(11,619 posts)
4. A national government is not like a corporation, where they do play with debt.
Fri May 6, 2016, 05:34 PM
May 2016

I would love to see some of the media take Obama's suggestion and point out the type of disaster that would lead to.

pampango

(24,692 posts)
22. To me that's the big difference between Bernie and Donald. Trump wants to burn the world down.
Sat May 7, 2016, 02:20 PM
May 2016

Bernie wants to make it better.

Ilsa

(61,695 posts)
8. This part:
Fri May 6, 2016, 05:57 PM
May 2016
A brilliant case study in the profound risks of attempting to apply the logic of a private business enterprise to the task of running the United States of America.

And this is why we don't need another businessman (like Dumbya) in the WH. Why don't people see this?

retrowire

(10,345 posts)
12. Yes.
Fri May 6, 2016, 08:00 PM
May 2016

We're in the primaries. The GOP primary is done. Trump is set.

Our battle is still being decided so yes, debating and protesting each other at this point in time, is appropriate.

Zynx

(21,328 posts)
14. The Dem primary is 99.999% decided barring some really shocking events.
Fri May 6, 2016, 08:05 PM
May 2016

Protests like this can only be harmful in establishing resentment.

Zynx

(21,328 posts)
16. How does he get 65% of the remaining delegates? His average vote share in primaries so far is about
Fri May 6, 2016, 08:11 PM
May 2016

41%. Even though he'll do better in the remaining primaries than that, it won't be by that much. Besides, he's behind in California right now and voting there starts soon.

I'd be willing to bet just about everything that I have that he doesn't even come close to 65% in CA. Hell, I'd be a little surprised if he broke 50% there.

Jeffersons Ghost

(15,235 posts)
20. I suspect that some people do not find the "math" @ Democratic Underground funny at all;...
Fri May 6, 2016, 09:53 PM
May 2016

but they like punctuation; especially exotic uses. In the future, will all online news articles have spelling and punctuation errors? I wonder why no one [other US Federal Agents] attempts to create [code] problems for enemies of freedom.

FailureToCommunicate

(14,014 posts)
17. Total bull feathers. The mostly Latino crowd included **some** Bernie supporters...
Fri May 6, 2016, 08:15 PM
May 2016

"...a largely Latino crowd in Monterey Park, where Union del Barrio organized a protest against Clinton over her immigration policies and opposition to a national $15 hourly minimum wage"

The headline is just plain wrong.

 

smirkymonkey

(63,221 posts)
10. What a complete and utter nightmare.
Fri May 6, 2016, 06:06 PM
May 2016

I can't believe this guy might actually become the POTUS. I really can't.

 

jtuck004

(15,882 posts)
11. All he has to do is get elected. He will then be the face of the full faith and credit of the United
Fri May 6, 2016, 07:43 PM
May 2016

States.

The Harriet Tubman argument will be over, as we can simply replace the face on all our bills with a clown.

 

nadinbrzezinski

(154,021 posts)
13. The folks at VOX are not too knoweldgable of this
Fri May 6, 2016, 08:00 PM
May 2016

sovereign debt restructuring,

https://www.cigionline.org/articles/imfs-debt-restructuring

Believe it or not, that is exactly what Trump is talking about. And it is great to destroy things like social security and other safety nets. See Greece for a dramatic example in the modern period.

Yeah, read a couple pieces, and that is precisely what Trump is talking about. It is scary as hell, but not that far fetched. And yes it would do incredible damage to the economy.

 

elmac

(4,642 posts)
18. Oh no! we could end up like Greece with banksters in control of everything
Fri May 6, 2016, 08:19 PM
May 2016

Wait!, Their already in control. Guess a bankruptcy wouldn't be so bad after all.
It doesn't matter if trump or whoever gets voted in as long as the rich elite are in control we all, as the 99%, are screwed.

 

jtuck004

(15,882 posts)
19. We have a fiat currency. We use it to pay those bills by giving them a credit in American
Fri May 6, 2016, 08:39 PM
May 2016

dollars in their choice of bank$ter accounts.

We are the sole manufacturer of said dollar, something we do by adding zeroes to a computer. We can never run out. We cannot "go bankrupt". We can inflate the amount or deflate it, but it's just zeroes. Also, I think there is a note somewhere that says we have to pay our bills, cannot go bankrupt. In the constitution, perhaps?

MMT at http://cas.umkc.edu/economics/
https://cas.umkc.edu/economics/people/facultyPages/wray/courses/Econ601%202012/readings/Mehrling%20Fiat.pdf

Understanding Modern Money: The Key to Full Employment and Price Stability - L. Randall Wray (1998)

It's not the kitchen cookie jar theory of economics, in which there is an "empty" or broke that most seem to refer to, but it is a treatise on modern methods of money and its use by this government.

There are docs and some videos of Federal Reserve folks, as well as others, offering this same theory, and it does explain what we do since we no longer base it on shiny metal.


...
there is 0% chance that the US will be forced to default on the debt.

We could choose to do so, just as a person trapped in a warehouse full of food could choose to starve, but we could never be forced to. This is not a theory or conjecture, it is cold, hard fact. The reason the US could never be forced to default is that every single bit of the debt is owed in the currency that we and only we can issue: dollars. Unlike Greece, we don’t have to try to earn foreign exchange via exports or beg for better terms. There is simply no level of debt we could not repay with a keystroke.
...


http://www.forbes.com/sites/johntharvey/2012/09/10/impossible-to-default/#3abd5bc75744

With other folks that talk about money.

No one knows how far we can inflatedeflate this bscheme which, since we aren't really providing the world with a bunch of knowledge or product that they can't get elsewhere, seems no longer based on anything except inertia and power. That seems to me to be extremely vulnerable to another country investing in knowledge and the future.






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