Friday, July 29, 2011

Can US Default on it's Debt. ??

No way ..are you kidding..?? In Paper currency it can never happen unless you do not control your paper currency. e.g. in case of PIIGS Portugal, Italy, Ireland, Greece and Spain currency is printed by ECB (European Central Bank) and hence technically they can default. No other country that control it's own currency can default in today's world.

However in long term if Hyperinflation becomes reality then probably countries have to default as they won't be able to do both i.e.
# Money supply shrinking via increasing interest rate.
#Increased payment on Interest.

but that's still 5 - 10 years away till then let's enjoy ..

No comments:

Post a Comment