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pahunkboy -> The Reenactment of 1776 (1/16/2009 3:51:12 PM)
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http://reenactmentof1776.com/
some guy wrote this up- it is a good read. I agree with most of it- unfortunately.
it sure does make one think.
/excerpt here -->
5. When these bonds mature the government has to pay them off. If they cannot pay them off then they will default. The United States government has never defaulted on its bonds. If you and I default on our debt then that means we're bankrupt, kaput, out of business. Same with the government. If the government defaults then no one will loan it any more money. These bonds mature every quarter, March, June, September and December. The fall of our government will probably come during one of these months within the next year to year and a half.
6. If the government cannot borrow then they have one alternative. That is to just print the money to pay off the IOU's. It is called monetarizing the debt. They will have to print so much money that the worth of a dollar will be reduced to nothing. Too much money chasing too few goods creates inflation, which will in all likelihood result in a hyperinflation not seen since the pre-World War II days in Germany. In this scenario the dollar will become like the Confederate currency of old or the German mark prior to Hitler. In Germany they had to get a wheel barrow and fill it with money just to go to the store for a loaf of bread. Those that forget the past are doomed to repeat it. A loaf of bread could easily go to $50 or higher. For people on fixed incomes the burden will be insurmountable, because their income will not go up; it is fixed. For people on retirement, social security, unemployment and welfare, clearly one fourth of their income would go for one loaf of bread. The people will not be able to eat or purchase staples that they need.
7. If hyperinflation hits, the worth of the bonds will plummet. Individuals, institutions and investors and foreign governments will either sell every bond they have or risk losing everything invested. The ones who will have to buy those bonds are banks, insurance companies and pension funds. As stated above, they are broke and cannot buy the bonds. The government bond market will fall apart, only this time the government will not be able to bail it out. This will be equivalent to a run on a bank, only this will be a run on our entire financial system.
8. Because local and county governments don't have borrowing power they will be the first to fold. Individual states and then the federal government will follow into default. If the police aren't getting paid they won't be on the streets. Minus law and order, chaos, rioting, looting and other forms of lawlessness will take place. It will get ugly./snip
you can read the entire thing at the link.
much of the media, INCLUDING the internet- is missing the point.
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