Greece Defaults. What now?

[sc94597]

padib said:

sc94597 said:

Yep. I have no confidence that any of these countries will stop what they are doing: going back and forth on interest rates until their bubbles get bigger and bigger due to malinvestments (directed by said interest rates), bailing out said malinvestments, while they amass trillions of dollars worth of debt which they'll never be able to sustain. There will be a larger recession than the one in 2008, hyperinflation, and higher unemployment everywhere. Furthermore, with the growing economic powers in the second and third worlds global wealth distributions will more often transfer to these other, more stable regions. The cause of this? Cronyism.

Who would they be defaulting to? If every country defaults, then who is going to enforce the rules of debt?

This cycle of chaos will only lead to war.

The internal private parties to which they owe money (bond holders, social security fund, government contractors, regional and state governments, social program funding, military pensions, etc, etc) as well as other national governments and businesess at different times (they won't all default at once.) Government will just refuse to pay these, which means they have defaulted on their payments. Alternatively the government can print money to pay these groups, but the effect is hyperinflation, so really the true monetary value they receive is not what was promised. Either way government is not paying people that it owes money to, and therefore has defaulted.