Third Time Defaulting
January 31, 2011
AAA Rating Tough to Defend as U.S. Debt Soars: Kevin Hassett
“Since its founding, the U.S. has defaulted on its debt twice. The first time, in 1790, it deferred payments on money owed stemming from the Revolutionary War. While the dollar values were eventually repaid — 10 years later — the delay was technically a default.
The second time, in 1933, the U.S. blatantly broke its obligation with creditors by refusing to repay loans in physical gold. Existing contracts stated that lenders could request payment in either dollars or gold, but President Franklin Delano Roosevelt and Congress, with plans to significantly inflate the dollar, passed a law forbidding repayment in gold. Again, the dollar values were repaid, but unilaterally changing the terms of a contract is the equivalent of a default.”
U.S. Treasury – “We’re Running a Ponzi Scheme”
January 25, 2011
The White House claims that unless Treasury can borrow more money, debts will not be paid. Bernie Madoff did something similar. Come on now, that’s like telling MasterCard you can’t pay your bill unless you get a new Ameican Express card.
