Haha…I forgot about that…Zimbabwe’s in DEEP lol
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Here’s a German ten billion mark postage stamp from the 1920’s.
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The highest denomination postage stamp was 50 billion marks. They are very rare used as they were only in use for a few days.
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“This man is going to be tied up in so many knots before this is over, it will take a team of psychic surgeons working around the clock to untangle.”
I think the tying of knots is just the point. This guy is so transparently a con man it’s unbelievable. Who hasn’t encountered someone like this trying to sell you something? The whole aim is not to say something intelligible but just to confuse you. But since the con artist sounds so confident and like he has some kind of high level knowledge you’re too embarrassed to ask him to explain it to you again. And then maybe you go ahead with the deal.
I think that’s all Trump is doing when he talks “policy.”.
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Bonds move up and down based on market conditions. The price variance is based on what willing buyers and sellers are willing to buy or sell for. While investors may pay more or less than par, the issuer can only repurchase debt at par. To do otherwise is to default.
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The sad thing is that Trump just poisoned the well for those of us who have been advocating for more government spending to improve the lives of Americans because at the end of the day, it’s a fiat currency based on trust in the largest economy on Earth and the debt is entirely and solely payable in our scrip, which means it cannot be paid out in gold, dongs or donuts.
For the next 20 years though, if you point out that so-called “printing” money (which doesn’t actually happen, it’s just a changing of account balances in a bank computer at the instruction of the government) and ignoring debt isn’t necessarily a bad idea (unless you go stupid and give everyone a trillion bucks), you’re going to be called a Trump-Head.
Fucking depressing. 
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I’ve never encountered such a transparent con man who wasn’t dressed in a 10 year old suit, wearing sneakers with holes, not having bathed in a week, promising me an in on a killer real estate deal if I only have $20 bucks to pay for a license.
Trump is ugly, repellent, idiotic, and yet he’s a billionaire, and possibly our next President. Amazing.
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Only for the last 29 years, but he’s 92, and people are getting worried.
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Insofar as Trump is right, guess what: the federal reserve and the treasury already do this kind of thing. Buy buying and selling Treasuries in the open market, the Fed can both implement interest-rate policies and sometimes make a healthy profit (which it returns to the treasury).
But. Unless you’re running a surplus, guess what: to buy that old debt you have to issue extra new debt. At higher interest rates. Which you will then be paying into the far future. So it’s a little like taking out a $100K second mortgage at 10% to buy from the bank your now-undervalued $150K mortgage at 5%. You might owe slightly less money, but your cash flow is no better.
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thank you for explaining it so succinctly - I wasn’t sure which was correct!
He’s won the primary, but he can’t get the ball over the line without those outside of his base. That means having to actually explain a couple of things, which he doesn’t seem to be very good at.
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“I don’t want to renegotiate the bonds,” Trump said. “But I think you
can do discounting, I think, you know, depending on where interest rates
are, I think you can buy back - you can - I’m not talking about with a
renegotiation, but you can buy back at discounts.”
Fine, Donnie. Who sets the discount rate?
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It is amazing. I just saw in the Times that in the CNN interview he claimed that when he just said that he was going to raise taxes on the wealthy he actually meant an increase compared to his campaign proposal which is “the biggest tax decrease of anybody running for office by far.” So actually he meant that the wealthy will pay less than they are right now. Could he possibly be more of a double-talker?
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He’s going to ‘negotiate’ that. He’s the greatest negotiator you’ve ever seen!
You’ll be amazed at how well he negotiates! When we’re done winning, he’s going to have negotiated so many wins, you’ll be sick of winning negotiably!
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Something we should all use as a preface to Donald Trump. Pull a Rove and nail him as he likes to brand people …lyin Ted Cruz etc
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Not really true, the US treasury or Fed can always buy back bonds at the current market price, which would inject liquid money into the economy (as well as the opposite: they can soak up excess liquidity by selling bonds), this has been a useful tool for the Fed (and other National Banks) many times.
However, the money used to buy back the debt must come from some place, and if it is the printing press, it will cause inflation and/or inflate an investment bubble.
Defaulting, as, say, Argentina have done several times over the last 150 years, is to stop paying interest and ending up buying back the debt at a ‘haircut’ (sometimes substantial, 30% or less of pari ). It does not make Argentina an attractive borrower and will increase the interest it pays in the long run.
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The ironic thing about the hyper-inflation in Germany in the 1920s is, it actually eliminated the war reparations debt Germany’s economy was weighed down by, and allowed for the rebuilding of Germany to the point where they damn near won a World War.
That’s similar the radical idea I have pointed out here at TPM before (not thew World War thing mind you). If Sanders et al wanted a real “revolution” then link the min. wage, as well as Social Security to the CPI then simply print money to zero out the debt. You not only drive out income inequality, but eliminate the debt and make idled wealth basically worthless.
(evil grin)
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Given the level of economic intelligence being displayed here by “The Donald” (destroy the economy to bring down the debt?) … I’m sure that he has an employee to tell him which sock goes on the left foot and which one goes on the right foot every morning when he gets dressed.
God knows only a fool would take a word he says at face value, and he’s had that reputation for decades. But I wonder if there’s another possibility—that he’s so far gone he simply says stuff he thinks people will like, then someone else says it’s crazy or stupid or they don’t like it, so he just changes his story on the spot, just like that, and claims he never said what he said. A con artist can keep his lies straight. Trump is a bullshitter, God knows, but at this point he may not be capable of conscious, tactical lying that can work in multiple contexts, most probably because he’s undergoing a worsening mental or physical illness.
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Hey, what is the big deal? I am sure that the Trump Treasury will only discount the debt when he is paying back Asians and other foreigners that were holding U.S. Treasury Bonds as part of some underhanded plot to screw the U.S. government by making us redeem our debt by paying face value.
Trump is a good guy! He is not going to hurt real Americans. He will only screw over those foreign snakes and thieves! Besides, after all, if they were in our shoes they would do it to us. If you think about it… This is nothing more than the logical extension of the Bush Administration’s ‘Doctrine of Preemption’ expanded into the world of finance. < / Snark>