Bingo! Any country borrowing in its own sovereign currency cannot default on debt in that currency, unless it actively decides to do so for political reasons.

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eigenspace 11 hours ago | parent | next [-]

This is a fantasy. Do you really think lenders would just not notice if America inflated its currency away to get rid of its debts, and they'd just say "aw shucks you got us. Anyways, here's a new loan at the same terms as last time." ?

And what about the American public? Look at how much Americans freaked out over a year or two of 6% yearly inflation. How do you think Americans would respond to 30% monthly inflation like in Argentina or Turkey?

	▲	itsyonas 7 hours ago \| parent [-]
		> This is a fantasy. How so. > Do you really think lenders A government with its own sovereign currency doesn't need lenders. In fact, it is the government that allows lenders to lend money - not the other way around. > Anyways, here's a new loan at the same terms as last time." ? Why would they need to get a loan for from a lender? > How do you think Americans would respond to 30% monthly inflation like in Argentina or Turkey? Do you think that printing money automatically causes inflation? How does that work? Do people have some kind of magical device, or is it a physical phenomenon that can be measured? Of course not. Printing money only causes inflation if it is spend in a way exceeds the capacity of the market.

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branko_d 11 hours ago | parent | prev [-]

Sure, but it can still have hyperinflation.