Wednesday, November 16, 2011

There is no national debt.

I get a kick out of all these US debt clocks.  I mean, jumpin' jeebus, what do people think these folks used to buy the US Treasuries that they are holding?  They used US dollars.  What's the difference in debt obligation to a holder of dollars compared to a holder of Treasuries?  Nothing.

The US has a sovereign, fiat currency.  Our federal government is an issuer of currency and, as such, can never go broke.  Ever.  We simply print the money we need to pay the debts.  Couldn't be more simple.  If you want to discuss the inflationary concerns about this, that is a different topic entirely.  Let's first all agree that the US can never go broke.