Topic: Why is developed nations asking money from other nations? (Read 196 times)

I believe they do that because of their too much printing of money. Their money have lower value now unlike before. Furthermore, being the world's strongest economic country doesn't guarantee economic collapse.

I believe that is worst than that. If they kept over spending on the stuff like Military and Weapons then they are just wasting their money. We are not at War and there may not be any in next decade at least! In the Era of Scientific exploration and Education country like USA is falling apart in terms of that. Countries like India, Japan and rest of the asia has emerged as land of science, businesses, unlimited employment and such!

India got upgraded with 40 new billionaires during the Pandemic. If you calculate their worth combined then it's in multi-trillions! India has huge amount of money flowing around.

Don't forget its not "PRINTED" money, it is real in and out with businesses, services, sells with domestic and international market. If USA don't plan for it then that kingdom is on the verge of fall in next 4-5 decades.

A collateral is given in return for loaning these countries' funds, So it's not like these developing countries are at a great loss, plus they gain the favor of US which is really good in the event of a war, knowing that USA has a vast arsenal of weaponry and a nuclear weapon at its disposal. So they gain collaterals and security as well by letting US loan funds on them.

And by selling weapons to every other nation around the globe. Sometimes it's for money, sometimes for favors, and if you don't want to buy from them you're the enemy (like Saddam).
Most countries are barely holding on if you think about it. The ones that are printing less are held together by a leader's strong hand, others, with more freedoms, have to print more because free people want more and you can't shut them up by force, you have to bargain more.

According to them, they are trying to avoid getting economy into recession so they always want seek support from other countries and in return, they would definitely have something inform of collateral in return for the money they borrowed.
In my country here, we are surrounded by clueless leaders who are in those positions to benefit their self always borrowed money from China and in return they gave out huge mineral resources like nickel and gold leaving the host community without much benefit.

I think that answer to the question is similar to situation when rich people dont pay full price when buying a new and expensive car, but instead buy by installment. Same goes with private property and etc. Even people who earn a lot, choose to buy new iphone with 12-24 month contract, instead paying full price, which they can do easily.

I guess that developed counties prefer to ask money because they plan in future to offer something in exchange or be in situation when other nations owe them and will write off the debt.

I think one reason why this is the case is that the currencies of developing nations are not as stable as the USD, JPY or EUR. So poorer nations who have a lot of international trade are looking for ways to diversify their currency exposure. Holding USD in government debt is one way to store money outside of the local currencies. Especially for countries with a lot of commodities which are being exported overseas there is a high demand for assets in other currencies.

That is not something as bad as you might imagine, it is something that could help those nations as well in the long future because they own debt from USA which everyone knows will be paid. USA may have as much debt as they want and that is of course bad for USA but the reality is that most of that debt is inside, so basically USA owns USA and the rest to these nations and these nations if doing worse, could just tell the people they owe money to "when I get money from USA I will pay that to you" and it will work, it is nearly impossible for that not to work.

I wish my nation had that kind of debt from USA as well. India and China and Japan and any other nation USA owes money to will be using this to actually show as a proof that they will have money one day from USA and can create their own debt as well. That is not a bad thing, obviously I would rather have the money itself, that is the bad part, but at least USA is a good nation to have debt from.

In reality, I would  say every nation needs support. Resources are scattered  across  the globe and no single country  can survive without  the help  of other Nations.  If the figures listed  in the OP, is anything  to go by, I think the media always tries to cover the negative side  of the USA. Currently,  I believe  China is relatively economically  stable  and less  indebted  compared  to any other  country in the world.

Before any developed nations asked for financial support to another country may be they have inner motive issues through their economy, because what really causes countries financial handicap is shortage of economy and crisis between political parties via power.
At times a country lend money because of the project at hand, that really means that developed countries likely to borrow from another country or the lowest country so far, from my perspective it's matters of execution of instant programmes or project at a particular period or time,

It may not be direct money because if countries asking money to other nations they can simply print money and lend it to them but I think its probably like of trade deal or something so the supposed revenue from the project(s) are going to be that value. Developing countries will be trying to build good relationships with powerful nations all the time so it's a kind of mutual agreement between both nations.

They understand and the last time I checked they didn't force the country to borrow them the money cause it was a bilateral arrangement between them.

Probably yes cause the loan can be use in an exchange for some assistance from the US.

 The masses will never understand the behavior of the government especially when it have to do with political ambition.

That's one good thing about the US, they can go extra just to get the needed solution.

Yeah it can be a good quote, why loan the money from a developing country when the US can print them   . If there is an inflation caused by the policies they make i am sure the entire market will be affected including the bitcoin market and we might see a shift in the momentum of global trade from the US dollar to Euro or other currencies and i doubt bitcoin can be that global trading currency.

This beautiful expression explains the ugly reality. Yes, it seems that the main role in this age of the media is to decorate everything and deceive us that everything is fine while the reality is quite the opposite. I thought that this only exists in the third world, but now I was surprised that this is the same thing even in the developed world.
Everything depends on polishing the picture.

We all know that U.S.A is one among the most important and economically powerful country of the world but as BrewMaster said, they are literally weak in handling spending and borrowing. Currently the total debt is at a rate of $29 trillion which is projected to hit an all time high of $100 trillion by end of 2050. With the coronavirus pandemic, United States spending on Medical facility has increased a lot more and a surplus money was need again to maintain the equilibrium of spending and hence they printed another $1.9 trillion. With COVID risking the global economy many of the developing countries like India has become literally very poor and would continue to worse in the upcoming years. While considering a country like India, it has more employees than the employers hence it is estimated the poverty rate would top to an ATH very soon.

Here US owning India a $200 billion isn't really profitable to India since I believe US being a powerful country could increase debt monetization in the future if they are on the verge of bailout. On top of that, almost 80% of the Indian IT industry is dominated by US companies hence if US does a hyperinflation act it might end up in companies investing more into India as the number of employees are large in number.

This situation will be worsened as decades passes by and this was one of the primary reasons behind the creation of bitcoin. Eventhough bitcoin has turned into a speculative investment by no-brainers the real fact behind the coin's creation could never be forgotten and I believe adopting a global currency would the only answer for such a huge debt driven economy.

because US only has the strongest economy in the world on paper. in reality it is quite weak and fragile actually. it is kept afloat by increasing the debt, printing more money and fooling everyone into thinking everything is OK.
it reminds of that picture where everything is on fire while the character keeps saying everything is fine.

I don't think this is a normal thing, I do not understand such matters. Frankly, how can a country like the United States which has the strongest economy in the world be in debt to countries much less economically like India or China? This is illogical. There must be hidden political reasons and interests behind such incomprehensible matters.

The loan stuff I see is a new and growing trend. Before this time around like 30 years back, it was not a popular phenomenon but it is now a new speck. Many countries that can take care of themselves have gone off that to also have a reliance on third world nations. Some reasons for this I think maybe,

I believe is just the trading pact that has occasioned this act of loan or borrowing from even developed countries to less developed and "smaller" nations.

Again, they say you have to be closer to know your friend and those you have relationship with. The developed nations are moving inside the frontiers of less developed natons with the guise of loan from them.

They also do that for exchange of manufactured products, man power and skilled labour. They are all consideration in the loan agreement that you don't see in public is just from government to government.

Is another type of colonialism called neo colonialism. They do that to allow easily access to move to there country for jobs. That is the beginning of brain drain.

The united states bailout of troubled foreign nations.

Parallels the european unions endless bailout of greece. A hard bailout rather than steps taken towards addressing greece's insolvency and debt issues.

There's a question of whether scenarios like US and EU bailouts could constitute a destruction of wealth. Which in turn could negatively affect our collective standard of living.

I'll try to give an example. In The Dark Knight Returns. The joker played by Heath Ledger burns a big pile of money. This might be considered destruction of wealth and something that could kill jobs and businesses. Decreasing standard of living in Gotham City.

It is possible that enormous amounts of wealth swallowed up and lost in the bailout of greece and nations bailed out by the USA are similar to the joker burning piles of cash. Over the long term it could destroy our standard of living. We could all end up poorer with fewer options and opportunities in life as a result of it.

Every country has its own debt, and for use they are using that money to strengthen their military program and not to fight poverty because many private institutions are already working for that which the government took advantage and become more corrupt. That debt can easily be paid, they’ll just print money but of course inflation will hit them back if they do that, taxpayers will be the one to shoulder that debt.