China holds ~1 Trillion dollars if US Debt. What’s stopping the US from canceling the debt, setting up a CV-19 aid fund, contribute 1 trillion to it and start paying all countries affected?

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Full faith and credit of the US government will be gone. This will then be a banana republic.

likesmart

Right now we’re a “bandana republic.” Because of the improvised face masks. And people at the MI capital. Heh.

funny

Common sense, ethics, and fully functioning brains

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Thanks SVP1, I’m in MC. I’d challenge your thinking a little bit on this though.

Company and Treasury securities are completely different animals. In times of flight to quality you have very different measures of credit (think relative). If the US were to cancel the debt and keep all the money to themselves then I agree, it would throw shade on US credit rating. But these are unprecedented times and the international committee, including Germany, France, Australia, Japan, UK and India are all contemplating their own individual actions on China’s duplicity (hiding/delaying data, no pt zero information yet, profiteering by buying stocks when the markets dipped). I think this could be a good way to hold China accountable safely, effectively and the global markets won’t react too poorly to it.

The very definition of cutting off your nose to spite your face; we would soon be no longer held as the world's reserve currency.

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You can’t cancel your own debt. Cancellation is by the creditor, not the debtor. Not paying would junk our credit status.

The reason we have $1T in debt is because we cannot pay it. It’s borrowed money. So, there’s no way to cancel it and pay it to others, even if that were a thing.

We only got $2Tish for our own economy (while already running a deficit), so there is now way we’d do loans or payments to others.

NP OP

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likefunny

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