>He is correct, with one unspoken addition: You can't go broke if you can print your own money AND the creditor will accept it.
>If you have a bookie who accepts RopellaBucks and pays in green backs, you will be good forever! If Greece can borrow dollars and pay in their own currency, same deal. 1) This is a compelling argument for a return to the Gold Standard. 2) Substitute "UncleSam" for "Ropella" and add the following "walk softly and carry a big stick to beat up weak nations and then compel them to buy little sticks to 'defend' themselves which they must pay for in Ropella (sorry US) bucks". On Fri, Oct 8, 2010 at 1:20 AM, ERIC P. CHARLES <e...@psu.edu> wrote: > Glen, > He is correct, with one unspoken addition: You can't go broke if you can > print your own money AND the creditor will accept it. > > If you have a bookie who accepts RopellaBucks and pays in green backs, you > will be good forever! If Greece can borrow dollars and pay in their own > currency, same deal. > > I'm not sure how international borrowing works, but eventually someone will > stop accepting your currency if it has devalued too much. At some point > after that, other people will stop trading for it too, so you won't even be > able to convert your RopellaBucks into usable currency. Then, in the long > run, you might be even more screwed than the semi-screwed you are in the > short run from being stuck on the Euro, with no ability to escalate > printing. > > Eric > >
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