Author: dragon8

The USA is Bankrupt   [Copy link] 中文

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Post time 2014-9-14 00:58:25 |Display all floors
ll利 Post time: 2014-9-14 00:36
nooooooooooooooo NOT Bailout,,, come on, Im talking about China banking.. its late Im going to bed ...

A bail out means a third party comes and rescues the borrower against its creditors. The third party can be central bank (For example FED saving many big US banks) or special purpose vehicle like EFSF which was used to bail out Greece against default 2010.

The investment trust you mentioned was bailed out by the government, probably using some special purpose vehicle. The investment government rescued and bought at full value, can be later "written off" if they so choose.

This has nothing to do with creating money.

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Post time 2014-9-14 09:30:35 |Display all floors
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[THIS IS A SHARED ACCOUNT] Our success symbolizes loyalty to our country. Dedication, hard work, routine builds character. In a world full of snakes, ...

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Post time 2014-9-15 00:36:08 |Display all floors
mixamixa Post time: 2014-9-14 00:30
All bonds have maturity dates, they cannot be called before the maturity date.

The problem for C ...

They can SELL bonds in the open markets at any time they feel like it..


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Post time 2014-9-15 01:35:58 |Display all floors
St_George Post time: 2014-9-15 00:36
They can SELL bonds in the open markets at any time they feel like it..

Yes, you are right, bonds can be sold in the market. But United States treasure redeems them at the maturity date at face value. It might be difficult for China to sell all dollar nominated debt with good price, and not suffer a huge loss.

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Post time 2014-9-15 01:47:37 |Display all floors
This post was edited by mixamixa at 2014-9-15 02:02
St_George Post time: 2014-9-15 00:36
They can SELL bonds in the open markets at any time they feel like it..

You wrote "call in the loans". Calling in a loan and selling it to another investor is not the same thing. If you sell the bond in the market to another investor there is no cashflow from the borrower to the bearer of the bond. Only cashflow between buyer and seller of the bond. So if your plan was to hurt USA by selling the bond before the maturity date, it won't work.

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Post time 2014-9-15 05:28:53 |Display all floors
mixamixa Post time: 2014-9-14 00:58
A bail out means a third party comes and rescues the borrower against its creditors. The third par ...

The third party is the serfs aka American taxpayers. And being obedient loyal serfs, they have all willingly donated $US33,000 each to the godfathers of Wall Street.  
Generous treatment of captured enemy troops.
Death to those that choose to fight.

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Post time 2014-9-15 07:52:27 |Display all floors
MisterZhu Post time: 2014-9-15 05:28
The third party is the serfs aka American taxpayers. And being obedient loyal serfs, they have all ...

Yes, the third party can be seen as US taxpayers. However they didn't donate anything, US government became big shareholder in many of the saved financial institutions, such as AIG, Fanny or JP Morgan. Those shares were later sold and US taxpayers got considerable amount money back and the financial system didn't collapse completely.

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