Monday, May 9, 2016

OMG Trump: US Never Has to Default, You Can Just Print the Money

Donald Trump declared Monday the U.S. never has to default on debt "because you print the money,"

"People said I want to go and buy debt and default on debt, and I mean, these people are crazy. This is the United States government," Trump told CNN's Chris Cuomo on "New Day." "First of all, you never have to default because you print the money, I hate to tell you, OK?" (at 16:03)

He also reiterated his view on U.S. firms opening up manufacturing operations outside the U.S., "We are going to make it harder for people to leave."



This guy is so far from a free market supporter that he makes Paul Krugman look like Murray Rothbard in comparison.


  -RW


19 comments:

  1. I think Alan Greenspan once said the same thing.

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  2. He is 100% correct in saying, "...you never have to default because you print the money, I hate to tell you, OK?"

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  3. Technically speaking, on the debt issue, he is correct that the U.S. would never have to default on its debt obligations, since the Fed can create currency units ad infinitum at will.

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    1. I hope this comment is tongue-in-cheek. Yes, according to the government monetary rules and regulations this would not be a legal default. However it is in realty a default. Printing the money means the government is paying back debt denominated in higher value currency with lower value currency and has defaulted on the basic promise of debtor to creditor. It results in no legal consequences because the legal system is corrupt but it is a default. In fact it is theft. And the real life consequence of forcing creditors to support government spending is a destruction of capital. A reduction in productivity and a grinding persistent impoverishment.

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    2. As I said; "technically speaking." I wasn't speaking to the moral argument or the real-world consequences of the matter.

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    3. I'm not sure what the moral dilemma is here. There is not candidate who is ever going to pay back the debt. Trump is pretty much openly saying it. The others wanted to keep the illusion going for as long as possible.

      Now I'm not going to vote for Trump (or anyone else either) but he has given buyers of us debt fair warning. So up to them to heed it or ignore it. I imagine that treasury debt holders already knew what Trump said would happen. They just figured there would be a greater fool down the road or that they would be the first to smell the smoke in the burning house and get to the exit before the others.

      Trump's best service to us, intended or not, is to let us know the end of the game is sooner that we thought.

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  4. Come on Robert. Don't you see. It's like Stone put it; he's a "closet" libertarian. He's just saying these things...

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  5. ─ He also reiterated his view on U.S. firms opening up manufacturing operations outside the U.S., "We are going to make it harder for people to leave." ─

    By kidnapping their families? Freezing their assets? No, wait, don't tell me ─ by BUILDING A WALL!

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  6. ─ Trump told CNN's Chris Cuomo on "New Day" [...] "First of all, you never have to default because you print the money, I hate to tell you, OK?" ─

    "And I'm counting on that all our creditors continue to be deluded fools who will trust America being 'great again' and the dollar, just like the deluded fools who voted for me!"

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  7. This is a good thing. People need to hear that we're printing the deficit.

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    1. Wags,

      This is one of the most intelligent statements I've ever read from you.

      The American peoples minds, generally speaking, just aren't ready for why this a not a good thing. The can will continue to be kicked down the road unabated.

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    2. I'm afraid that most people don't have a clue what he's talking about. None.

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  8. It wasn't controversial when Greenspan said it years ago.

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  9. "We are going to make it harder for [businesses] to leave."

    Wouldn't it be refreshing to hear someone say, ""We are going to make it easier for businesses to stay."

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    1. I agree. And though it is fraught with issues, this is basically Texas' approach.

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  10. My economics professor and I spoke on this issue when a student asked about debt repayment. The conclusion we reached, much to the chagrin of the professor, was that the US never really had to repay the debt, we could just print more. The worst part of it all, this is the same professor who encouraged us to invest in Treasury bonds. Hilarious.

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  11. There also is no reason to collect an income tax since the money for government expenditures can simply be printed.

    The income tax exists for two reasons.

    1. Social control. To keep people in fear and subjection to government.
    2. To draw down the money supply and keep monetary inflation under some semblance of control.

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    1. Mr. Wenzel - you consistently overlook the only fact about Trump that matters. He is NOT Hillary Clinton.....and that's all he needs to be.

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  12. The blogosphere is alive with this issue thanks to Trump, and it's interesting that many writing on this subject begin with bashing libertarians and Austrian economics for their wrongheadedness, as if being wary of the dangers of printing money is the same as a lack of understanding.

    For example: "Donald Trump showed a greater understanding of our monetary system than huge swathes of libertarians who think they get it because they've read some Austrian economics and the Creature from Jekyll Island. That really upsets me."

    The apologencia on this subject span the history of money debasement, and it's always a matter of bashing those discerning enough to have reservations - like everything else, I suppose.

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