Comment: "They were going it alone.

(See in situ)

"They were going it alone.

"They were going it alone. They was no one else willing to take any risk with Zimbabwe. They didn't have any "sugar daddies" like we have with China, Japan, Germany, and Britain buying our debt. Even if none of those theoretical corn fields of yours burned, the same thing would have happened only not as quickly."

See, this is the mistake you make. You have no idea if this is true. You just assume it to be true. The US government does not need to borrow money to run deficits. As long as the US does not run so many deficits to cause too much inflation (therefore reducing the real yield on dollar-denominated assets), there is no reason for individuals to not buy US debt (in general. They can always fear that the US government is overthrown, etc.). Rates will only go up if people fear no payment, that inflation will eat away real rates, or if more competitive forms of investment arise on the economy (which was why rates were higher during much stronger US budgets in the Clinton years).

The reason that the Zimbabwe dollar became inflated, was that there was no productive capability of the Zimbabwean economy to meet the newly printed currency. Hence, investors become scared of buying Zimbabwe-currency denominated assets, because they are afraid that the same thing will happen. The same thing happens with some countries like China, were people are worried that the government will be overthrown, and their debt will be repudiated.

In the US, where is the evidence that the US will have hyperinflation? Where is the evidence that productive capacity will be suddenly destroyed? We're much more well-protected against supply shocks than Zimbabwe was.

I can easily say that no gold-backed currency has ever survived in the history of the world. How do I know this? There aren't any.

Plan for eliminating the national debt in 10-20 years:


Specific cuts; defense spending: