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PM Justin Trudeau's Canada

afransen said:
That can all be true, and yet our public debt jumped more than it has since WW2. It can have been the right thing to do, and something we need to address moving forward.
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I think the Western world as a whole is going to have to come to terms with its public debt. Sort out who owes who what, and refinance or change the global financial system like we did at Bretton Woods to cancel those debts entirely. Government owned debt is a mirage, consisting of promises to pay back imagery currency to either itself (the Bank of Canada), its own commercial banks or foreign governments and banks. The system is self-perpetuating. China owns a lot of Western debt, what's the incentive to pay that despotic regime back? My prediction is that within the next 30-50 years governments around the world will simply throw up their hands and say, tough sh#t we're not paying. The Third world is already nearing this point.
 
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Admiral Beez said:
I think the Western world as a whole is going to have to come to terms with its public debt. Sort out who owes who what, and refinance or change the global financial system like we did at Bretton Woods to cancel those debts entirely. Government owned debt is a mirage, consisting of promises to pay back imagery currency to either itself (the Bank of Canada), its own commercial banks or foreign governments and banks. The system is self-perpetuating. China owns a lot of Western debt, what's the incentive to pay that despotic regime back? My prediction is that within the next 30-50 years governments around the world will simply throw up their hands and say, tough sh#t we're not paying. The Third world is already nearing this point.
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The problem is that unlike at Bretton Woods, the holders of our debt are not allies, and it will be hard to come to a mutual deal; this would be unilateral. Also, we hold very little Chinese debt, so we would have to give something in return. If we just say "screw you" and don't pay, our reputation will be ruined and government debt will have very few takers. It's like New York in 1975, people didn't want their debt because they couldn't pay it. Also, China has given our governments lots of loans, and whether they're allies or not, we have an obligation to repay them.

Of course, I think that governments that owe themselves ... well, I wouldn't be against a law saying that the BoC cannot own government debt.
 
DirectionNorth said:
The problem is that unlike at Bretton Woods, the holders of our debt are not allies, and it will be hard to come to a mutual deal; this would be unilateral. Also, we hold very little Chinese debt, so we would have to give something in return. If we just say "screw you" and don't pay, our reputation will be ruined and government debt will have very few takers. It's like New York in 1975, people didn't want their debt because they couldn't pay it. Also, China has given our governments lots of loans, and whether they're allies or not, we have an obligation to repay them.

Of course, I think that governments that owe themselves ... well, I wouldn't be against a law saying that the BoC cannot own government debt.
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I believe the majority of our debt is owed to Canadians, not other nations.

AoD
 
DirectionNorth said:
The problem is that unlike at Bretton Woods, the holders of our debt are not allies,
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If referring to Canada, the last figures I saw were for fiscal 2017-2018, and at that point 64% of all Canadian government debt was owned to Canadians or their institutions (big banks).

Since the debt explosion in the last year and a 1/2 several hundred billion of our debt has been bought/issued by the Bank of Canada (so the government owes that money to itself).

I'm not certain what the figures are today, and would welcome someone publishing them, but my sense would be that less than 1/4 of public debt is held by foreigners today.
 
I don't take defaulting on our debt as a serious proposal. The only way we would 'default' is a soft default through inflation. There is literally no need for us to default, we can print Canadian dollars by the truckload.

Such a default/inflating away our debt is just another way of taxing our citizens, since much of our debt is owned by domestic savers.
 
afransen said:
I don't take defaulting on our debt as a serious proposal. The only way we would 'default' is a soft default through inflation. There is literally no need for us to default, we can print Canadian dollars by the truckload.

Such a default/inflating away our debt is just another way of taxing our citizens, since much of our debt is owned by domestic savers.
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Not defaulting, and not Canada alone. I’m suggesting all the G20 countries renegotiate.
 
People used to barter with goods and services. However, I think we're well past that now. We're rather tied into a whole system of currency in one form or another.
 
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