Thursday, August 11, 2011
Is it dangerous that the U.S. defaults on debt with China?
Wow...it would the worst thing the U.S. could ever do. This is not a political ploy by either side. The potential for the U.S. to default on their debt would be mean some serious implications for the U.S. Since China holds most of our debt, they can decide to cut us off, and we would definitely be broke since we have been borrowing so much money from them. Right now, what we pay to China is only the interest on the loans, not the actual loan itself. We have borrowed so much from China, even the interest payment is getting hard, and we are about to default on our loan. If this happens, people could lose their jobs, our stock market could crash, we wouldn't have money to even function as a country. Let's say the U.S. was paying their loans and there wasn't a potential catastrophe like there is now, at any time China could ask for their money back. If this happens, the U.S. is screwed....REALLY screwed. The United States does not have the money to pay them back, unless they make some SERIOUS changes and efforts to fix this problem. We are getting to the point where we keep spending and giving so much to other countries for aid, we are getting ourselves into more trouble financially, and its going to be VERY difficult to get out of.
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