Another crazy 'what if' discussion by me & my friends

[ryan256]

Could North Korea buy up all of the US treasury notes and debt from other asian countries and then try to destroy the US economy by cashing them all in?

I say no because the other asian countries would never sell these instruments to North Korea. However if they somehow managed to get ahold of them I think the US would refuse to pay. What all that would do the economy I'm not sure.

Discuss.

 

[PlatinumGold]

hate to break it to you, but the US economy is already broken. i just don't see how we will make a recovery from the current situation. we have no manufacturing. we have no way of supporting a middle class. the house with 2 cars in each garage dream is dead.

 

[KB]

Where would NK get the money to buy the debt? It is huge, too big for one economy to own.

According to a Federal Reserve news release "At the end of 2005, China, with $820 billion in such assets, was the second-largest holder of U.S. debt after Japan, which held about $10 billion more."

This source from the US Treasury shows more up-to-date foreign ownership (broken down by country) of US Treasury bonds http://www.ustreas.gov/tic/mfh.txt

 

[ElFenix]

they don't have the money to buy them all up and i'm pretty certain they can't just accelerate the notes.

Originally posted by: PlatinumGold
hate to break it to you, but the US economy is already broken. i just don't see how we will make a recovery from the current situation. we have no manufacturing. we have no way of supporting a middle class. the house with 2 cars in each garage dream is dead.

funny, up until the current issues we had more manufacturing than ever.




i have to wonder if, during the transition from an agrarian to manufacturing economy, people made the same 'omg our economy is dead we don't farm anymore!' type comments?

 

[Capt Caveman]

Since NK can't afford to even feed it's own people, how are they going to get the money to do this?

 

[nageov3t]

why would China sell to NK? they need America to stay afloat to buy all their crap at Walmart.

 

[Injury]

This would assume the following:

-North Korea could AFFORD to buy it all
-The countries they want to buy from are willing to give up their stake of the American economy
-The countries they are buying it from understand the political risk associated with doing this and that goods from THEIR countries would no longer have a place to ship to.

 

[MmmSkyscraper]

You got the 'crazy' part right.

 

[sdifox]

What kind of dumbasses think NK is a credible threat to USA?

 

[KnickNut3]

I'm surprised that no one else yet has pointed out the caveat that you can't "cash in" debt. How is this supposed to work, how is the US required to respond, and how will it "cripple" the economy?

I just see Bernanke running through the streets, mugging people, screaming "WE NEED TO PAY NORTH KOREA! THEY CASHED IN THEIR BONDS!"

It's not like whoever owns our bonds is a loanshark.

 

[Gothgar]

Originally posted by: KnickNut3
I'm surprised that no one else yet has pointed out the caveat that you can't "cash in" debt. How is this supposed to work, how is the US required to respond, and how will it "cripple" the economy?

I just see Bernanke running through the streets, mugging people, screaming "WE NEED TO PAY NORTH KOREA! THEY CASHED IN THEIR BONDS!"

It's not like whoever owns our bonds is a loanshark.

lulz

gimme my money bitch!

 

[yllus]

Originally posted by: ElFenix
i have to wonder if, during the transition from an agrarian to manufacturing economy, people made the same 'omg our economy is dead we don't farm anymore!' type comments?

Better question: Was nobody around here alive for the era in which the USSR still existed? The decade of awesomeness we just enjoyed was an exception, not the rule. I don't get why people are freaking out now considering the world is still doing incredibly well in comparison to other decades.