Krugman has this to say about it:
For those not familiar with how financial markets work, US Treasuries are the ultimate safe asset, used as collateral for everything. Even a hint that some Treasuries might not be honored could bring everything to a screeching halt
Musk and Trump are both in the habit of stiffing people they owe money. If markets even suspect that this habit will extend to Treasuries, God help us
This breaks the economy.
If the US defaults on its loans, its creditability drops, which will probably destabilize the global value of the US$. China and Russia will benefit most. Every nation with financial ties to the US will suffer for it.
When trying to understand why certain decisions are made, follow the money. Donald Trump is a foreign asset.
Something most people don’t get is that China holding a significant portion of our debt gives them an incentive to protect USD. By defaulting, there is no reason for them not to do everything in their power to destroy USD. This is literally the only meaningful economic tool the US has and he wants to devalue it.
Russia has already defaulted on some loans. China’s second biggest trade partner is USA (EU is first but trade is more balanced between the two than USA), so this would hurt China greatly as well.
Seems to me EU would benefit the most.
Only usa can have total control no other currencies could ever replace it because they are not as good at being world leaders? Or something like that? All wealth would just move, probably half china half eu, and even then, it may already have happened mostly because this isn’t news to anyone with a brain
If you mean he is working for them… nah. He wouldn’t do what they ask, or would screw it up. They get smarter people to manipulate him into doing things in thier favor. I suppose that could be called a foriegn asset to. Not sure though.