Topic: US could run out of cash as soon as Dec. 15, Janet Yellen warns (Read 601 times)

That's because the US Dollar is still the reserve currency of the world. Not to mention, people aren't using Bitcoin as a "unit of account". Things would've been different if everything was valued in terms of Bitcoin instead of Fiat. In a "hyperbitcoinized" world, you would measure the value of goods and services in terms of "satoshis" instead of US Dollars or any other national currency. It sounds crazy but not far from becoming a reality soon.

There's only one way "hyperbitcoinization" will happen and that is if the current banking system collapses in its entirety. As soon as the USD and other Fiat currencies collapse, Bitcoin and other cryptocurrencies will take over the global economy. USD's inflation rate keeps rising, so it should only be a matter of time before people start losing faith in it. Just my thoughts

Yeah right..
Russian banks imported $5 billion in foreign cash in December


I'm willing to bet that besides their national currency almost nobody here knows the price of bitcoin in anything other than $, I don't remember anybody cheering that BTC has reached 1 million or 3 million rubles or got passed 200 000 or 300 000 yuans.
No matter what you wish to think is happening, the $ is still king, and not threatened by any other currency, and as long as china sell stuff for those $, and pays its imports in $, there will be no de-dollarization.

This crisis seems to come around like clockwork every 2-4 years and it really is a bit ridiculous. Covid made things tough but both parties have contributed to the overall borrowing figure so it should never be reduced to petty politics in order to raise it. Unless both parties start to commit to having a budget surplus, then the default path should be to raise it without pushing the government and connected services to the brink each time. The fact is that if America ever "ran out of money" it would be a self inflicted wound by one of the two main political parties and for no other reason. The central bank is able to print more money any time they choose and as the reserve currency of the world it'll be easily absorbed.

Sadly, the US national debt keeps increasing like there's no tomorrow. Sooner or later, the USD will lose its status as the reserve currency of the world. The FED will simply print more money in order to help "solve" the situation. But at the end of the day, this will affect the pockets of everyday people (especially those in the middle-class). Those who're smart would simply invest into Gold and/or Bitcoin in order to retain purchasing power over time.

Just like you've said, things will get worse with the rising tensions along the Russia-Ukraine border. The cost of living for Americans will be so high, that people will be forced to emigrate from the country. I just hope the USD will recover back to its former glory after the end of the COVID-19 pandemic. There's lot of uncertainty right now, so we should be prepared for the worst. Just my opinion

For about 30 years I have been watching the hysterical cries of all the "fighters against capitalism", like "here they will destroy the USA, the dollar and capitalism." During this time, the USSR, the Warsaw Pact collapsed, all the builders of "bright socialism" have also either rotted or changed the vector of development to the norms of the normal world. In order for one system to be really replaced by another, this requires the consent of those who manage this process. Now the blood of the world economy is the dollar. And the whole world is absolutely satisfied with this, well, except for a couple of fighters for a "bright future" like Maduro, Putin, North Korean Kim Jong-un

LOL.. if anyone want to check the US federal debt in real time, then go to this website: https://www.usdebtclock.org/

For those who are unware, the federal debt has crossed $30 trillion, thanks to people like Janet Yellen and Ben Bernanke. And I would blame both the Trump and the Biden regimes for this spike in debt. When Trump took office, the debt stood at $20 trillion, and it was measured at $26.9 trillion when he left office. And Biden managed to add $3 trillion to it in just around one year. And it will get worse, given the rising oil prices and tensions along the Russia-Ukraine border. Only fools would store their money in USD right now.

Exactly. The government will never run out of money as long as it controls its supply. It's just as easy as "pushing the button" to print more bills and put them in circulation. If there's too much inflation, the central bank can simply create a new currency from the ground up. Just like you said, this might be the perfect time to launch digital Fiat. Only the debasement of existing Fiat currencies will lead us towards a cashless society faster than we could've ever imagined.

With the US Dollar still positioning itself as the reserve currency of the world, it's unlikely the American economy will collapse in its entirety anytime soon. Just my thoughts

The government running out of money? Impossible! Just print more! 

I imagine they'll do some manipulation to "solve" this if they don't outright let the printers go brrr again. Or they just might let that inflation skyrocket and then resolve it by creating a new currency, similarly to how Brazil's Real came to be. Perfect time to launch a digital fiat, I would say.

Good point. After all, Fiat is strongly manipulated by governments and central banks. In the case of the US Dollar, the FED can simply print more money to "solve" the problem. Inflation will rise, but that's something inevitable. For Fiat to truly disappear (or collapse), banks need to fail altogether. But again, that's very unlikely to happen because of the reasons mentioned previously. With talks about launching a "digital dollar", it seems to me that America's currency won't be going anywhere soon.

At least, there's an alternative financial system which empowers people to be their own bank. If we didn't had Bitcoin in the first place, we would've been "stuck" with centralized Fiat. Hopefully, the US economy will recover after the end of the COVID-19 pandemic. Just my thoughts

FIAT collapsing completely? I don't think so. This isn't the first time that FIAT currencies like the dollar have faced these kind of issues and they have successfully endured no matter what which will most likely never change.

BTC becoming the standard payment method is just wishful thinking. It will continue to co-exist with FIAT currencies and won't completely replace them in my opinion.

sometimes reading propaganda theories as you convey as shown in a collection of facts that are deliberately hidden by many people and when believing them like strangers in the midst of mistakes in society.  The current economic system is just waiting for time to collapse and can't take it anymore, in the end the fiat system will change to another new system such as the gold system being replaced.

The national debt may be rising, but the US can simply print more money to "solve" the problem. This will lead us to greater inflation rates, which translates to the devaluation of the US Dollar. The higher the debt grows, the faster the world's reserve currency will plummet. I wouldn't worry too much about this since we already got Bitcoin. People who want to protect themselves from the negative effects of inflation will simply resort to deflationary assets like Bitcoin and Gold. It's as simple as that.

If Fiat collapses in its entirety, then we might be headed back to the Gold standard. Or maybe Bitcoin will take over the world as the standard unit of account? We'll see what'll happen with the US and the global economy as the pandemic continues to take the world by storm. Just my opinion

Its real that the debts outweigh the available assets, only by issuing a continual stream of new money do the books then balance.    It doesnt have to collapse but its precarious to have constant deficits both fiscally and also trade deficits ongoing for years into decades.   Every citizen of the USA now owes over 70k towards the national debt if all debts were called in.   That isnt possible normally as some of these bonds are not due for 20 years but still its not fantasy situation but a reality and the end result is continual dollar devaluation.

Yes, I remember this thread! Well, tell me how "the US ran out of cash"? Has the dollar already collapsed? Is the US economy bankrupt? Yuan has become the world's international settlement currency? Not ? Oh - why so? Yeah, I understand - now the national debt will grow to $ 35 billion, and then "everything will definitely collapse in the USA"! But you will be surprised - NOTHING will happen. You just need to read less science fiction propagandists

I guess the US president will not allow such thing to happen to their citizens economy than to do everything possible to eliminate inflation,bad economy and make cash surplus to the people. President will not accommodate corruption that will make his country to run out of cash than to print more money that will sustain the country economy like 20 years before another government will take over the government and to make sure the economy do not collapse for his hands.

US president has done so much to their economy which they will never experience economy crisis or cash crisis in the country. US Centra bank is well ready to print any amount of money the president will instruct them to print more cash that will make inflation not to near their country.

It's not that worrying for them though, they've been in a lot of housing crisis before so I really don't know if they're experiencing something bad, to be honest I think that they will eventually recover from this even without paying those debts because I feel like they care more about letting the debt stay because those who lend those money probably cares more about the favor rather than the getting the money back.

$30T in national debt is a lot of money. I think COVID has terribly damaged the US economy where there would be no point for recovery. If this keeps up, then the US will go bankrupt taking the global economy down with it. After all, the US Dollar is the world's reserve currency. There's only one solution to this problem. And that is Bitcoin. If people start saving money in Bitcoin, their wealth/purchasing power would be unaffected by the USD's ever-rising inflation rates. Governments can benefit from Bitcoin's deflationary abilities, if they adopt it as legal tender. El Salvador already did the move, what makes you think other countries won't do the same? With Fiat collapsing, there could be a strong reason to switch to Bitcoin altogether.

We'll see how everything will turn out to be in the future as the American economy goes on the brink of collapse. Just my opinion

Read this: https://www.voanews.com/a/us-national-debt-tops-30-trillion-for-first-time-in-history-/6424498.html

According to this source US national debt tops 30 trillion for the first time in history!

For the first time since World War II in 1946, the United States was indebted to such a large amount. Which is a matter of considerable concern.

So, still you think the news is unnecessarily alarmist. You should read the whole news from this source before you think so.


The government can run out of money because of the debt of such a large amount. And printing more money would not be able to save them.
Prior to the outbreak of the corona virus, the country was already in debt and the COVID spread and the economy began to collapse in a lockdown.
And that's why so many people in the United States are out of work. And the United States has to borrow more to cover the deficit.
According to the US Department of Revenue, from January 2021 to January 2022, government debt increased to $7 trillion.

In this regard, Janet Yellen's statement seems to be correct.

December 15 is long gone, but we don't see anything negatively impacting the US finances and economy. They used to close financial problems by printing new dollars. Of course, this cannot continue indefinitely. In this case, the states will gradually abandon the dollar, and the reasons for this may be different. Russia is now doing this to evade international sanctions. The news is that the dollar is really falling and it is better to invest in the British pound, Japanese yen and Swiss franc. The Euro does not seem to be much quoted either.

Personally I believe that wealth tax is a regressive idea. The democrats are debating about it, because they believe that it will make the billionaires pay more taxes than they are doing right now. It was Ron Wyden (D-Oregon), who first proposed to tax unrealized capital gains, claiming that the uber-rich hardly ever sell their assets and that makes it extremely difficult to tax them. I don't support this move as well, but for me at least on paper taxing the unrealized capital gains sounds more viable than imposing a wealth tax.

The US can't keep up their taxes on the wealthy with their spending habits, despite the harsh rhetoric of wealth taxes or ensuring the rich pay their fair share. Most of it is political pandering, as are many other things related to demonizing the rich, but on a deeper level politicians are aware that if they keep driving up the effective tax rate, it'll slow down growth. The strategy for the US, I'm assuming, has been growing the economy in order to raise enough revenue to pay off the debt. Their reckless spending has not slowed down, and Covid has slowed the economy, so all this has thrown a wrench in their plans. Expect a wealth tax to be passed sooner rather than later.

They always have a way of lobbying the opposition members to reach a compromise and get the economy running. If the US runs out of cash,many sectors will suffer, even stock market could crash heavily and many nations dependent on US aid would be distressed. The US really need to enforce some financial discipline and stop reckless printing of money that always cause inflation.

It is difficult to say what to expect, but if the US itself does not do stupid things and / or an objectively more profitable instrument does not appear than the dollar, and it is not accepted by the world economic majority, the dollar has no problems on the horizon. China is perhaps the biggest bubble in human history. And soon enough you will see the Chinese economy rushing downward, picking up speed and demolishing everything in its path. This will destroy the Chinese economy, and affect the world economy, but the world economy is larger and more stable than the Chinese one, ABSOLUTELY dependent on the market of buyers from the same EU and the USA.

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Absolutely agree ! No matter how stable the dollar and the US economy are, an overestimation of its capabilities always leads to very unpleasant consequences. But now I do not see any signs of such "stupid actions" that can really lead to a catastrophe of the US economy and the dollar as a whole. There is still one side of the problem - even if the dollar is "bad", the question is - who will replace it? euro? yuan? pound? The world economy will not be able to operate on multicurrency settlements; they need a unique means of calculation. But none of the above are suitable for this role.


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That's the point. The US is still the leading economy of the world, even with the negative effects of the COVID-19 pandemic. Since the US Dollar is the reserve currency of the world, the government can easily manipulate the mainstream economy in its favor. "Running out of cash" is simply an excuse to print more money in the long haul. This will only create a higher inflation rate, effectively devaluing the US Dollar. Of course, this won't remove the US Dollar's dominance on the world economy. But it will have a negative effect over people's pockets as costs become too high to bear. Luckily, this will "pump" scarce assets like Bitcoin and Gold all the way to the moon. Holders of these assets will obtain greater purchasing power as inflation grows like crazy. The US government claims the current situation is temporary so there's hope everything will go back to normal after the end of the COVID-19 pandemic. Just my thoughts

The december 15th, 2021 deadline is looming large on the horizon.

My memory of past debt ceiling raises and the implications of it not being raised are vague.

Some sources claim that failure to raise the debt ceiling would result in a default. Other sources have said that essential operations and funding of programs like social security, unemployment and food stamps would continue to run normally while other less critical aspects of government would be shut down.

If the debt ceiling is not raised before the deadline, I guess we will all find out together what the real world implications are.

Vaguely, I seem to remember the debt ceiling not being raised and government shutting down under Obama. Without anything serious happening, most may not even have realized it occurred. But I could be remembering incorrectly on that.

They got complacent, the dollar has been the reserve currency of the world for so long that they think they can keep abusing of their privilege forever, this is why they can get away with financial and economic policies that will simply bankrupt any other country, but this is not going to last forever.

Competing countries are tired of this advantage the dollar gives to the US and they are looking for ways to reduce the amount of dollars they keep in reserve and that they accept as payment, and if enough countries begin to do this then the rate of inflation of the dollar on its home country will increase dramatically as those dollars will have nowhere to go but back to the US.

The question is what would be the alternative to the reserve currency US dollar for export-strong countries?

There is none. It would damage confidence massively, but in principle not much would change. There would be only two options as a reserve currency, that would be the Euro and the Yuan. But both have their weaknesses, and other currencies like the Yen or the Swiss Franc are too small to serve as a world reserve currency.

It amuses me how perfectly developed country like U.S. can get into trap like this? I mean developing countries are way better than U.S. in managing their economy and reduce the inflation at faster rates. For example, many asian countries are on the list who has so much population, so much infra to develop and survive on both farmers and huge IT and pharma sectors. They have giant infra to develop for their country, they have huge problems being democratic countries, no presidential rule, yet contributing to biggest economic bulge to the globe. I am pretty sure U.S. is like a country who overspends the budgets all the time on unnecessary stuff. They have so much industrialisation and perfect taxation system then also they run out of the funds. It's way funny to think. I am not sure if this is true but I have read somewhere that they overspend the money military and keep doing so in trillions of dollars. Is it really necessary to do so?

Not surprised. US penalizes wealth creators by imposing more and more taxes (now there is an insane proposals to tax capital gains up to 60%), and encourages those who are unproductive. China on the other hand prioritizes wealth creation and clamps down on social parasites and welfare rats. The results are out there for everyone to see. Wealth creators are moving out of the US, and opening their factories elsewhere. Obamacare and rising minimum wages have made opening businesses and factories in the US unsustainable.

And that is the main issue, there was a time the British pound was the reserve currency of the world but then it got replaced by the dollar, so while the US is taking full advantage of this it may come the day in which the US dollar will be replaced by another currency.

And while this is inevitable, at the same time the way they are manipulating their currency supply and causing high inflation all over the world means that competing countries have more and more reasons to begin to look for alternatives to the current system, accelerating the collapse of the dollar in the process.

Okay, that must be great points.  The  U.S. dollar being in power gives it a lot of advantages. Maybe all these things that people are saying that there will be a problem and this and that, maybe it’s not going to happen, but don’t you think that they still have to be careful and try to apply measures that are going to help make things better? Because this is just like a wearing of shoes, maybe it wouldn’t have an effect now, but as time goes on as it continues to pile up,  the time might come when it will finally have an effect, and the effect they might not be able to handle it.

So, if they really want to avoid such a problem, maybe now would be a good time to start applying measures that are going to help them to avoid all these problems in the future. I do know that for many years now that a lot of people keep saying things like this but it never happens come but they (government) still have to be careful and mind the kind of actions they are taking.

This makes quite a lot of sense and honestly, how often has it now been said that the US is going to be broke in a couple of weeks from now? Countless times by now?

What you just outlined here is the truth and actually the one thing that does indeed safe the US. I am wondering though whether the US dollar will stay on top for very long as there is reason to believe that this could change in the future.

https://www.bloomberg.com/news/articles/2021-11-15/global-wealth-surges-as-china-overtakes-u-s-to-grab-top-spot

China's net worth grew from $7 trillion to $120 trillion between 2000 and 2020 whereas the US doubled their net worth to $90 trillion over the same period of time.

Understand one simple thing - the USA produces the most demanded product in the world - the DOLLAR! Everyone needs it, because he can do anything. Whether someone likes it or not ... And given that the "blood" of the world economy is the same dollar, the printed extra billions of dollars will not create any noticeable negative for either the US economy or the world economy. The world market will eat all the pieces of paper that the United States will give him. In the end, when the printed money returns to the banking system, everything that the USA needs will be bought with it - they will saturate its market with what it needs, the "extra paper" will dissolve in the accounts and wallets of manufacturers around the world.

I don't think there's reason to panic, especially when the US Dollar enjoys its status as the reserve currency of the world. The United States of America can simply manipulate the economy to its own benefit. Inflation has always been there, but now the situation is worse with the pandemic affecting the global economy. Constant government spending will only increase the debt, greatly affect the value of the US Dollar. Long-term speaking, the US Dollar will fail. But in the short-term, it's highly unlikely that'll happen due to reasons mentioned before. As long as we have Bitcoin, nothing else matters

As long as USD is the reserve currency of the world, they can go on doing this. And although there have been attempts to use currencies such as Euro and CNY for the global trade, they were met with limited success. It is foolish to assume anyone outside China would be willing to use the CNY, which is perhaps the most manipulated currency in the world. US Dollar is not the best currency, but right now it is more reliable and trustworthy when compared to the other fiats out there such as the CNY, RUR and GBP.

It is true the US cannot really default on its debts as they can pay with newly printed dollars if they want, however how long can they keep this? Even before the pandemic countries like China and Russia were looking to trade using their own currencies and were avoiding the dollar.

If this continues then more countries will begin to do the same and the hegemony of the dollar could collapse, and if it does the world economy will be in huge problems, this will help bitcoin but at the same time this will probably harden the posture of many governments and they will begin to go against anyone that was cautious enough to put their wealth in a store of value like bitcoin.

Well if we look into the past there were the same Rumours many times but every time there was some way out for all those scenarios.
Unlike in the past, everything will be settled as there wasn't any such situation occurred ever (i.e: entering into new agreements or by some other legislation processes) but please note down that there aren't going to be run out of cash.

Not like USA has ever hit the ceiling, not like they never stopped the government before, not like both Obama and Trump failed to pay government workers for a long period of time just because they couldn't come to an agreement, this would be unique and for the first time right??

Come on guys, Janet is basically trolling right now with how she is acting all innocent and worried and so forth and all she is trying to say is that something bad is about to happen and there is nothing we could stop it, it is bad but we are going to do it anyway because we have to. They will maybe even shut the government down for a while just like how they did it before and then they are going to increase their debt by 10+ more trillion dollars in just 5 years or maybe even quicker and act shocked when the next president needs to increase the ceiling all over again.

This has been the case for as long as I can remember. Creating a situation, a crisis and then asking for your voters to look at it so they would care about it and vote for your party is the key to success over at USA. Platon said (2000 years ago!!!!) "democracy is an education work, without education democracy would turn to oligarchy and if you continue then you will have demagogues and from demagogues you get dictators".

This is something that is still valid today and USA is not a very well educated nation, try to explain to any other nation why they should not have free healthcare with their taxes, try to explain to them why all their taxes should go to military getting new ships with airplanes on it, none of them would vote for you because those people are educated. However in USA saying things like "you can't afford free healthcare, we need to buy more guns!!!" gets you votes. Janet Yellen basically uses the same tactic to divert attention something else.

Inflation has always been there. But now it's more noticeable due to the negative effects of the pandemic on the global economy. It's up to you to secure your capital by investing into scarce assets like Bitcoin and Gold. Only then, you'll avoid losing purchasing power in the long run. The US Dollar is already losing traction so it should only be a matter of time before another currency replaces it as the world's reserve currency. I'd imagine inflation having a positive effect over Bitcoin's price in the long term. Who knows if prices go higher after Dec 15? Just my thoughts

The US is not in trouble.The US politicians are again creating some drama that nobody needs.
The US debt ceiling debate has become a normal thing,which happens in the end of every year,since the Obama administration,if I remember this correctly.
Both parties will settle some kind of agreement and the debt ceiling will be raised again.I assume that before that agreement,there will be some accusations between both democrats and republicans,so the drama seeking mainstream media can be happy,but there will be a compromise in the end.
The USA cannot go default because they have a money printing machine and US dollar is the global currency.

The silly thing is, the US can print as much money as it likes (within reason) because it has a rather unique power of being the foremost reserve currency of the world and that gives it a lot of perks. If it prints more money it can devalue any debt denominated in US dollars, which of course is what the US government sells to other people all the time. So at present the only thing that would cause this calamity to happen is the grand standing of politicians of both parties who are trying to squeeze various concessions but could great amounts of unnecessary stress to lots of people with these doomsday headlines and both sides trying to weaken the other but never actually solving the problem - which is runaway spending habits, often on useless junk like overly generous military spending.

It is true that some responsible people have been warning about this possibility for a long time, however the general population and the politicians like always are misinterpreting the signals.

This is similar to when you get sick, at first the symptoms are mild, however you still feel fine and you are not really that affected by the symptoms, but you receive some early warnings from your family members about seeing a doctor but you do not listen, then it gets worse but since it has not killed you and so many other diseases you got did not kill you then you assume this is going to be the case as well, eventually things get even worse and you finally go and see a doctor which tells you it is too late to do anything, you complain of course but the doctor states this could have been easily solved if you went and see them immediately.

This is what is happening with the US economy, since the crash has not happened despite the warnings politicians believe it will never happen, but it will, and the longer the delay the harder the crash.

Pretty scary that they might go into some sort of depression all over again because that kind of debt defaulting will only result with that one thing. I don't see how it's going to affect bitcoin or crypto in general though? I just can't piece it together. Now that I think of it, the lifespan of an empire is around 250 years before a collapse and I think that USA is around 246 years old so...

The reptilian overlord Janet Yellen at her best. I laughed quite a lot after hearing about the possibility of the US "running out of cash"... Do you guys know how much cash did they printed in the last 2 years? The M1 monetary supply for US Dollar went up by almost 3 times in the past 2 years. Now she wants to print more money? I am not sure about what happened to the tens of trillions worth of banknotes that were printed during the last two years. All that cash vanished without a trace? And now they are running out of cash?

Quite a shocking news, what baffles me is that despite this information being accessible to the governmental bodies, despite the dangers that they were warned about since the time of Trump, they still continue to do things to make the value of not just the dollar or the government, to make the value of the whole country, go down, plus it would be so sudden that any recovery might take a lot of time. US is also loosing a lot of workers, a lot of employees, therefore their economy might not be able to sustain itself.

The debts which are already huge would just increase more and more, what I think is that the financial ministry is not doing their job right, if the government still continue to make these decisions despite them having troubles with printing more money than recommend.

The public debt is already 28.91 trillion more than it has ever been before. Hopefully the government is able to reform their decisions before it's too late.

Hasn't this happened already in the past multiple times?

The fiat system is irretrievably broken and this is just one of the symptoms. It's not the root cause of its issues like Yellen makes it seem.

The more the debt ceiling gets lifted, the more money is going to come into circulation and therefore inflation will pick up. Our only chance is holding cryptos as a hedge.

I believe that it is mainly ineffective method of spending the money that they get. They collect so many taxes every single year and in the end they always spend it on the wrong things. For some weird reason, Americans believe that if they are not insanely powerful when it comes to military, then they are going to be doing horrible.

Even the idea of "thanks for your services" to every single soldier they see is a weird one. What service really? The last justified war happened 70 years ago, all the soldiers you see actively working either went to another nation to kill them, or they have been stationed in their nation and did basically nothing, this cost the whole nation probably 20+ trillion dollars in the past 2 decades, probably more. So I am pretty sure if they focused on making their own nation better instead of focusing on killing other nations, maybe they wouldn't be this much in debt.

Even though I'm not a US citizen, I remember very well how Joe Biden's policies were at the beginning after he was sworn in. Several controversial regulations were passed, ranging from taxes to economic stimulus with a very large value as well as a focus on infrastructure development. As at the beginning, I thought that the economic crisis would appear soon, but it has already begun to be realized. The policy solution that can be done is to actually implement a tapering off policy, as well as other contractionary monetary policies.

This is good for Bitcoin, but bad for the global economy. Knowing that the USD is the reserve currency of the world, anything that affects its value (like inflation) will have a negative impact over other countries worldwide. This is not to my surprise, since the pandemic severely affected the American economy. Continuous government spending and money printing will only make matters worse in the long run. Crypto will be put to the test, as the current banking system nears the edge of collapse. Bitcoin "hodlers" will inevitably gain more purchasing power, as the cryptocurrency itself is the antithesis of inflation. Who knows if the decaying global economy opens a path for Bitcoin to become the world's next reserve currency? Just my thoughts

The only outcome I see is the increase in inflation.

Increasing their debt ceiling is the result of ineffective management of loans, and yet we still perceive the USA as a powerful nation when they are now struggling with paying their debts. I feel that one country will rule above the USA as in the long run they will not be able to keep their problem and people will lose faith in USD, but anyway, it's good for crypto for sure.

It sounds bad, and it might look like the US is in trouble, but I'm with those pointing out that the US will get away with this. No other country could allow it, but given the significance of the USD worldwide and firm economic standing of the US in the world, they'll just print more or do something like that, and who knows, maybe the inflation won't even be that bad as a result because, again, dollar is in such high demand worldwide and so much other fiat relies on it as a reference point of stability, against which other coins' values are measured. One day, it will backfire, but not this time. US is still too powerful. But I do believe that the poor will be affected more than most, of course, and in this sense, it can be devastating for the US even this time around.

I only know the situation back home and where I live now, and yeah, I can see prices for basic food items already notching up. I'm not driving but fuel's going to bite in winter anyway, my energy provider went bust, so my long-term contract's out the window and the new provider already is giving me very painful estimates. I don't spend much on luxury or anything else but I do cook almost daily so the markups are quite evident.

I always said jokingly 1 million dollar Bitcoin's actually possible when the US dollar goes to shite but yeah, all this talk of default and US economy and dollar worst-case scenarios won't happen in our lifetime. Not because it's not heading there but because those in charge won't allow it.

Still many people are reluctant to have only fiat or the so called safe heaven as they are living only in the delusional world where fiat is king but they are ignoring the rising inflation and cannot spot the corrupt government policies and yes they are still unaware about usage of bitcoin that could free them from the chains of centralized slavery but this is social trap and they are unknowingly becoming victims and puppet of the government and living an ordinary life which tells btc is not good and bad for environment but the so called paper money is good because it's government legal tender and accepted by all.The percentage will increase but it might be too late till they realize this fact.

So it really does not matter if the debt ceiling is increased or not... the outcome will be the same. The government cannot honor it's commitments and the tax payers become the safety net again.    The only negative impact will be market sentiments... but who will worry about that? (The US are one of the strongest economies in the world and they have bounced back from several "near" market crashes before)

Also if all fails... WAR is the solution. These wars give them unlimited funds to stimulate the economy and to create jobs for the unemployed. (Cannon fodder for the rich and powerful) 

It is a bunch of theatrics for sure.

I doubt that this will actually transpire into anything meaningful.

They will eventually raise the debt ceiling because everyone understands what is at stake for the U.S. based fiat currency system if it doesn't happen. But it'll certainly happen slowly, and contingent on demands from both sides.

Considering the ceiling was raised during Obama and then Trump and now probably on Biden, it is just a regular part of life for USA government. They never really covered the nation properly and they never did a proper taxation so it is quite common for them to not have enough funds to compete with anything else.

I get that some people may want to see USA doing better but it is just not possible at this moment. They are spending money at a rate even socialist countries can't tax enough. I am one of the belief that rich people should be taxed a lot more, specially with their stock gains, but even that won't be enough to cover all these expenses. It means instead of trying to find funds, they need to cut expenses.

In a nation that spends 79 billion on education and 750+ billion on military, maybe it is time to cut that down. In a situation where 1 trillion dollars such a huge amount, if they cut 500 billion out of that military then it would be paid back in 2 years, all of pandemic would be covered in 6-8 years.

The United States faced the same problem about ten years ago, but this time things seem more serious. At that time during the Obama administration, Standard & Poor's (the largest credit rating company in the world) lowered the credit rating of the United States from (AAA) rating to (AA+). And the American administration faced severe criticism because this reduces the confidence of investors in the United States of America, now the situation seems much more dangerous with the spread of the Corona virus and the many crises that the tired American economy suffers from, the main problem in my opinion is that the collapse of the American economy will lead to the collapse of the global economy as happened in a crisis Mortgage in 2008, which threatened the entire global economy at that time to collapse. The main reason is the centralization The link of the global system to the US dollar and the US economy clearly shows the necessity of moving to a decentralized global economic system that Satoshi laid his foundations with the invention of Bitcoin.

Understanding US Debt is one of my aspirations.

When you talk about your usual run-of-the-mill, third world country defaulting on its debt, the meaning is pretty much straight-forward. Countries have debt from International institutions or other countries on which they need to make regular interest payments. Failing to pay up amounts to default.

Now, who does the US owe fund to? To its own public, it seems.

This makes it pretty difficult to figure out what exactly does this mean. Some of the biggest creditors are the retirement and social security funds. This is because common people keep funding these by putting apart of their continous savings into it. These "Pension funds" are essentially cash cows. Thus, they buy up bonds from the government in return of the cash.

Now if the US govt defaults, guess who loses? These funds. Because then the debt held by them will lose its value and it'll be a situation of their funds having made a "bad investment" by investing in US Bonds.

Isn't that neat? The Govt gets to fund itself from people's savings. If it defaults, its the people's savings that gets hit.

On further reading, this gets funnier. Apparently the US can only default on its debt, if it breaks its debt ceiling. The Congress votes to increase this ceiling. If it can't do it with bipartisan agreement, that will mean a debt default. This is supposed to spook the markets and lead to a financial crisis. The only threat is the "sentiment". Nothing else. This essentially means that as long as USD is surmount, nothing bad can happen.

The situation this time around is a little bit different with China starting to gain ground. Even then, I don't think any of the major financial institutions, pension funds and banks that hold US debt are ever going to get spooked and move their investments elsewhere. So, these headlines are little more than click-bait; AND a trick to make you learn about this crazy system.

While I love America, it seems that it has become so polarized around the extremes - it is at it's worst now with politicians trying to score points and maintain their own career salary instead of doing what is best for the country. The Republicans spent their last term trying to build a wall instead of focusing on the crumbling state of roads and bridges, now they're acting like babies because it creates good publicity for the democrats. I don't think the Democrats are angels at all, but at least they are not building their political base on hatred and division. It's a sad state of affairs when democracies only revolve around two political parties because it leaves so little room for compromise or change.

But how many such people are there in the US or globally? I will not go into the percentages that often come from various surveys based on a few hundred or maybe a thousand respondents selected from parts of society who have higher education and know how to secure themselves financially, but even that 10% of US citizens own Bitcoin, I'm sure few can say that they do not care about what will happen to their economy and currency.

Bitcoin is still relatively underrepresented as a storehouse of value for ordinary people, meaning they are dependent on the system and the mostly incompetent and corrupt governments that run it.

This time it will!!!! 

These are just like zerohedge predictions, I remember this line from gentlemand:

Guess what, nothing will happen.
The US government won't run out of money, the US will not default and the next year we're going to have the same discussions again and this time it will be the last time...or maybe not!
The US debt is in $, the US can print $, unlike any other country they don't need another currency but others need theirs, so, nothing to see for a while, move along.


Really depends on what you're buying.
Things here are just a mess, a complete mess, prices for energy have skyrocketed, prices for some things like electronics or spare parts the same, some foods again, but others...not really. Meat and vegetables stayed nearly flat, fruits barely moved, transportation costs flat (except if you drive yourself, of course), most services the same, or clothes and health products.
It has a lot to do with what you import, how much of it, and how bad the sector was hit by this.

The governments have been putting the financial stability of the countries at stake from ages and when they see situations going out of hands they face the public with negative outlook and all these situations is potrayed as this has happened due to pandemic.But they have the simple solution to this which is printing more notes as they have been doing from the past.


To all those who hold bitcoin don't care about social security at all as and all the freedom lies in their hands and government will not tell u and make you fool devaluing your inflationary fiat slowly and then next government will come up with same excuses and filling up their pokcets and you will have nothing left with you.

I think this news is a bit unnecessarily alarmist. Whenever the US government starts facing a cash crises they always find a way to pawn off the debt in complicated ways. I think they will just print more money, therefore dropping the value of the USD via inflation and the ones who will have to foot the bill will be the citizens of the US. That way the dollar amount debt they owe stays the same but loses value at the same time.

And bread and milk at the supermarket rises in price, the unemployment rate up down because the companies can't handle the inflation without firing people and now you have more people on the streets.

Some use this situation to keep markets under constant pressure and create a classic FUD that the world will collapse because the US will run out of money, and we all know that this will not happen anywhere else except maybe in a movie. Democrats and Republicans may play their political games from time to time, but when the water reaches their throats they will agree very quickly and everything will continue at the usual pace.

Absolutely! That's the price they will pay and that's what makes it a one-time thing. Once it's used, it's gone forever. Nobody will trust the currency again!

So we also have record inflation on the cards not just in the US but in most of Europe, and large swathes of the global South.

Inflation, debt and defaulting of the world's biggest economy. That has got to be good for Bitcoin, no? Though I wonder if 100k usd next year is going to be as valuable as 100k usd now.

This should send everyone a very powerful message: there is no going back and the more they print, the deeper the scar will be.  Raising the debt ceiling is of no good.  It is going to only make things worse.  Once the recession triggers, we are going to wish there was no debt ceiling raise.

We are right at the start of a very deep crisis.  Look up the inflation rate of almost any country and you will see how bad this is becoming.  Not only in US, not only in Europe but worldwide.  There is no time to make any mistakes and I am really concerned about a choice as such.  As much as we do not want to see a crisis and to acknowledge there is going to be one, pushing it back again and again will only backfire on us stronger than ever.

-
Regards,
PrivacyG

And I'm familiar with this from many years ago as well, this happens periodically in the USA, kind of Groundhog Day but in politics. I don't have a crystal ball, but it is clear to me that they will not run out of cash, in the end they will reach an agreement in extremis and everything will be settled, as has happened several times in the past.

The government prints a lot already. Although it may be considered a solution, it's also going to make inflation rise as it is happening already in US.
There had been debates about raising the debt ceiling but no one will really want to be portrayed as a bad guy which is likely either Dem or Rep will not support it. But we'll see if this someone out there going to stand up and be the one.

The US can't practically run out of cash as long as the world reserve currency is the USD. They can print money to pay their debts even to foreign countries. Of course that's a single use get-out-of-jail card. Because once they do that, the USD will cease to be the reserve currency.

Possibly at that point some "other" currency that is not controlled by any single government... perhaps something decentralized.

Oh, this looks like news recycling. Unfortunately, it isn't. But this is the exact same headline I read on the papers in July and then in August and in September and in October and now in November. Are we gonna be reading the same news next month? What's happening to the most powerful country in the world?

Is raising the debt ceiling the only way to resolve this issue once and for all? Or are the Republicans right in blocking it and instead pointing out the indiscriminate spending of the government?

....



More at source. I trimmed the article down to its most relevant parts.

It appears that a US federal government default is on the table. An event which has reached mythical proportions over the past century. Every year for the past 50+ years people warn the government could default and social security will collapse. This negative sentiment has become so common and widespread that over time americans have come to believe it can never happen. "Social security will fail." Oh but people have been saying it will fail for 50 years and it hasn't. This means social security can never fail.

As time passes and debt grows, our options and safety net for resolving these issues in a positive way, shrink.

If anyone has bright ideas for how these issues might be resolved. Now would be a good time to voice them.

A jump start on what could develop into a full blown crisis might also be a good policy.