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At risk: Currency privilege of the dollar

Posted on 11 October 2013

Not all government debt is created equal. Some governments get a much better deal than others, and no one gets a better deal than the United States. The United States borrows in its own currency, and it borrows at extremely low interest rates. It also borrows under its own laws, an often overlooked advantage. Such a situation makes default — or at least involuntary default — impossible because the government can print dollars if need be.
The value of the dollars it repays may be less than the value of the dollars it borrows, but that is a risk the lenders accept. The United States could change its laws, but it is trusted not to abuse that right………………………………………..Full Article: Source


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VRS - who has written 36545 posts on Opalesque Commodities Briefing.


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