Follow @PoliticsIE
 
 
 
Page 1 of 9 12345 ... LastLast
Results 1 to 10 of 89

Thread: Debt Forgiveness - A Solution?

  1. #1

    Default Debt Forgiveness - A Solution?

    Total Global debt is between 200 Trillion and 300 Trillion US Dollars. Most of this Debt is in the western world. Total Financial assets are about 70 Trillion US Dollars. The planet is technically insolvent.

    We are in a debt deflationary depressionary spiral for which the only escape is via a hyperinflationary model. We screwed both ways. The possible consequense of all this is massive civil unrest and the breakdown of society.

    For Greece, with on and off balance sheet liabilities at over 800%, it's game over. For the Eurozone, with the same ratio at about 500%, it is also game over. For the US, at 500%+, it is, you guessed it (sorry Joseph Stiglitz), game over, but since we have the printers, it will simply take a little longer. Following up on yesterday's popular post on prevailing delusions as captured by Albert Edwards' colleague Dylan Grice, we present Albert's latest outlook. Please don't read this if you want to keep believing there is any hope left for the (developed) world.

    But first some aeral photography from Dylan Grice, indicating just how far the US government is willing to go to get the population stoked about owning fixed (shouldn't it be called broken really?) income. With British QE over, and the country still to implement the same criminal annuitizing of 401(k)s that Uncle Sam is contempltating in order to make "Buy Bonds" a "voluntary" option one can't really decline, maybe letters on modern architecture building blocks is all that would works. As Edwards says: "I'm not sure leaving man-sized building blocks around the City of London is really going to make an awful lot of difference, but I suppose when your public sector deficit is around 13% of GDP, every little bit helps!"
    Albert Edwards: At 500% Net Liabilities To GDP, It Is Too Late To Prevent The Collapse Of The G-7; Greece Is Irrelevant, We Are All Now Insolvent | zero hedge

    Is there a solution to this mess? I was just thinking about a concept called debt forgiveness. This is a process were some or all debts are written off and cancelled. To avoid the impending doom, the cancellation of debt, a reset and a new financial system? Could civil unrest be avoided if people were cleansed of debt?

    There are a lot of negatives and problems in this proposition I know. But its just an idea I had 15 minutes ago over a cup of coffee, please appreciate that and it is worth brainstorming at least.

    Whether or not this depression is by accident or planned we have to seriously start thinking of radicle ideas and solutions as the clock is ticking.
    “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.” - Friedrich A. Hayek

  2. #2
    Politics.ie Member
    Join Date
    May 2009
    Posts
    9,410
    Mentioned
    0 Post(s)

    Default

    No - people should repay their debts.

  3. #3

    Default

    Quote Originally Posted by toughbutfair View Post
    No - people should repay their debts.
    I agree with the metaphysical argument of that. I am debt free myself, but collosial global debt is the issue and the shrinking incomes cannot service this even with record low interest rates.
    “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.” - Friedrich A. Hayek

  4. #4
    Politics.ie Member
    Join Date
    May 2009
    Posts
    1,027
    Mentioned
    0 Post(s)

    Default

    Why not just cancel all debts on December 31st of every year? Then nobody will ever have to be in debt.

  5. #5
    Politics.ie Member eoghanacht's Avatar
    Join Date
    Apr 2006
    Location
    sitting on my toilet.
    Posts
    33,357
    Mentioned
    0 Post(s)

    Default

    Quote Originally Posted by toughbutfair View Post
    No - people should repay their debts.
    unless ofcourse they work/worked in irish banking, then you get a golden handshake and a villa in the algarve to golf for the rest of your day's
    Britain operated death squads - ''97% of the Loyalists I interviewed were working directly for the State.'' - Nuala O'Loan. #FreeAhedTamimi

  6. #6
    Ex Member
    Join Date
    Sep 2008
    Location
    Around the Corner everyone has turned
    Posts
    3,586
    Mentioned
    0 Post(s)

    Default

    Its time we really did consider this at least from Irelands point of view.

    Debt forgiveness would pump fresh life into the economy, people wouldnt need to rely on such levels of welfare, business could invest and take more staff on, in fact the only losers would be people who didnt have any debt and as Toughbutfair always seems to state, TOUGH!

    If we really want to get this economy moving again then Debt Forgiveness is the only way forward to start Ireland with a clean slate and get this country moving again.
    Last edited by Bi ciuin; 15th February 2010 at 08:37 PM.

  7. #7
    Politics.ie Member
    Join Date
    Dec 2008
    Posts
    701
    Mentioned
    0 Post(s)

    Default

    Quote Originally Posted by toughbutfair View Post
    No - people should repay their debts.
    True. People should repay their debts, but countries, and to a lesser extent businesses don't have to, in the sense they can keep rolling them over, in a way that people can't. The average person might have 40 odd years of productive life, but countries carry on (hopefully) longer than that.

    So, it makes little sense (to me) to combine all the different types of debt belonging to a country into a single figure. It really gives no clue as to the ability of a country to repay its debts. It makes for frightening headlines though.

  8. #8
    Politics.ie Member mr_anderson's Avatar
    Join Date
    Dec 2007
    Posts
    9,768
    Mentioned
    0 Post(s)

    Default

    I'm all for debt forgiveness ... just so long as you give me sufficient notice beforehand, allowing me to jump into the deep end of the debt pool.

    Yippeee free money !!!

  9. #9
    Politics.ie Member roc_'s Avatar
    Join Date
    Dec 2009
    Posts
    5,826
    Mentioned
    0 Post(s)

    Default

    Quote Originally Posted by toughbutfair View Post
    No - people should repay their debts.
    They should indeed. But the fact is that many are unable to. Here we have a primary nub of the financial crisis.

    I might add that the money lent out was your savings and pensions and the savings and pensions of the Germans, Chinese etc.

    So how come you and others didn't care how the banking intermediaries were lending your money out, and for what - as long as you got your little return? Now, all you have to say is that they must pay you back... when (a) they can't (b) the insistence on it is a very important component of what is crippling the economy.

    One thing that strikes me about this crisis is that people should have kept a better, more responsible eye on their money - looked into the eyes and soul of the actual people who was handling their money, and thought about what these people were actually doing with their money.

    I know I did a long time ago - I saw clearly that these bankers and pension fund managers etc. were of a low kind, in thrall to an insidious logic that left them as mindless amoral zombies. And I also saw that what they were actually doing with this money was even worse.

    So, I said to myself, no way would I put my money into such hands... I could never understand why most people were happy to.
    “Words are animals, alive with a will of their own”.

  10. #10

    Default

    Hugh Hendry and Joseph Stiglitz on Greece and DEBT…
    Hugh Hendry simply gives a lesson to Joe Stiglitz who proves that he does not understand debt. Hendry suggests that the only way out is through debt default or debt forgiveness. Yes, he is 100% correct, everything else is simply debt shuffling, and yes, that would whack the banks. Just ignore the Spanish Ambassador, he has no clue and a very biased outlook. Stiglitz, however, has no excuse and clearly does not understand debt saturation.

    Freedom’s Vision is the right course of action, not only for the United States, but also Greece and most of the world. (ht JB)
    http://economicedge.blogspot.com/201...iglitz-on.html
    “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.” - Friedrich A. Hayek

Page 1 of 9 12345 ... LastLast

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •