| NJ5 said: @steven787: What is the fundamental difference between credit card debt and national debt that you're thinking of? |
Credit card debt is generally accompanied by fees, high interest rates set by the creditor. The amount borrowed is determined and limited by the creditor with limited openess (as a debtor can't shop too much for a credit card, because each report inquiry hurts their score, what economist call asymetric information)
Government bond and treasury note interest rates are set by the debtor slightly above inflation based on demand for the note. The amount borrowed isset by the debtor and sold on an open market with complete disclosure (symetrical information?) .
Debt held by U.S. citizens (saving bonds, etc.)
6,059,726,289,765.44
Total debt
10,334,206,499,002.15
That's about 60% of the national debt.
Savings bonds and treasury notes are basically a voluntary program where people can receive interest for "investing" in america. This keeps taxes low and encourages savings.
Credit cards encourage people to buy stupid shit that they can't afford.
That being said, that doesn't mean that national debt is good. When it's too high, they have to raise interest rate to encourage more sales, meaning there will be less to use later.
I would cite regulation, but I know you will simply ignore it.
