[roenxi]

Even that argument is starting to fall apart. What are the theatres where the US is supposed to be able to put on a strong showing? It doesn't seem to be Europe, they've got war on their doorstep and if anyone thinks the US is helping they should reflect on their reasoning. It doesn't seem to be the Middle East, the US has made the region less safe. They're not going to be able to act effectively against China given the trouble Russia has been giving them.

The US can't afford to extract tribute from people. It isn't powerful enough, relatively speaking.

[SideburnsOfDoom]

> Even that argument is starting to fall apart.

Yes, that's what's happening. They were paying tribute, based on a mutually beneficial status quo. Now they're asking if they should continue to.

[AnimalMuppet]

They weren't (for the most part) paying tribute. They were putting their money somewhere safe - somewhere where the risks of default, inflation, and devaluation were lower than other places.

But I agree, now they're asking if they should continue, because those assumptions are starting to look invalid.

[pjc50]

> What are the theatres where the US is supposed to be able to put on a strong showing? It doesn't seem to be Europe, they've got war on their doorstep and if anyone thinks the US is helping they should reflect on their reasoning

I think you have this backwards: the US was helping considerably, and then got taken over by pro-Russian conspiracy theorists.

But the bond stuff isn't "tribute" or nationalism; remember, it's being made by private sector investors, not national governments. Fairly straightforward calculation: which way is the exchange rate expected to move? Interest rate? Risk of default?

Up till now the US offered moderate interest rates, favourable direction of exchange rate movement, and imperceptible risk of default. There's still no reason to default other than madness and a desire to strap on the suicide vest and become Argentina.

[roenxi]

> But the bond stuff isn't "tribute" or nationalism; remember, it's being made by private sector investors, not national governments.

Are you sure about that? Back in 2022 the US Treaury reckoned that most holdings were foreign governments [0] - they had Foreign Official at ~3.9 trillion and foreign total at ~7.5 trillion. That has been shifting towards the private sector since then but the market has heavy sovereign involvement.

> and imperceptible risk of default.

The US clearly has quite a high risk of default - there isn't a reasonable path to them paying the money back. It takes imagination to even come up with scenarios where they try. In real terms they are going to default, in nominal terms there is still a high chance that they call it a default. There is no guarantee that they'll print money for foreigners; it is already going to be farcical claiming that they're not defaulting as they devalue like mad; it is quite possible they won't bother with the act and just do the honest thing.

[0] https://ticdata.treasury.gov/resource-center/data-chart-cent...

[pjc50]

> there isn't a reasonable path to them paying the money back

Indefinite rollover is completely fine! Yes there are problems if the total interest payment gets too large, and there's scope for discussion about that, but there's no hard cutoff, it just becomes more and more uncomfortable.

People saying there will be a default: deadline please. Or is this just a general assumption that mortality is inevitable for states? The UK has never defaulted, for example.

[roenxi]

It isn't completely fine and the interest payments are too large.

Sure the US can afford its debts if it avoids paying fair interest and never returns the principle. The idea that is reasonable from a lender's perspective is fantasy and we live in reality.

> The UK has never defaulted, for example.

The UK has traditionally not been in a state of running up debts; they borrowed money for things like world wars then spent most of their time paying loans down. The US isn't behaving like a creditworthy country because they borrow to consume and they aren't attempting to shrink the debt.

If the US tended to be repaying the money it borrowed then it'd be plausible that they intend to avoid a default.

[pjc50]

> never returns the principle

But it does! All the bonds pay out after X years, and everyone is completely fine with this.

> The UK has traditionally not been in a state of running up debts; they borrowed money for things like world wars then spent most of their time paying loans down. The US isn't behaving like a creditworthy country because they borrow to consume and they aren't attempting to shrink the debt.

You've not looked at the numbers, have you.

[roenxi]

> But it does! All the bonds pay out after X years, and everyone is completely fine with this.

I'm happy to argue with you but you're going to have to read the entire sentence. Possibly even the entire paragraph. Otherwise it is a bit pointless even for the fun of it.

> You've not looked at the numbers, have you.

I have, I put a good 5-10 minutes in to it. I suspect you haven't looked at the numbers.

You can find references on places like the BBC [0] but there are also charts that go back to the 1800s and the story is reasonably consistent. Historically most years the UK pays down debt. In fact, the last time it didn't was the 1930s and after that klutzy fumble it didn't get to be an empire any more, so that was a mistake.

[0] https://ichef.bbci.co.uk/ace/standard/800/cpsprodpb/16CB7/pr...

[aa-jv]

>the US was helping considerably, and then got taken over by pro-Russian conspiracy theorists.

This is such a nonsense conspiracy theory. Anything "non-American" isn't by default pro-Russian, ffs.

Come on people, this nonsense has to die. You can't be that dumb. Nobody believes this excuse any more.

Maybe America is in trouble because Americans are just shit at keeping themselves safe from real harm, and Russia has nothing to do with it.

[t420mom]

The Middle East is less safe because the US made an example of Saddam when he offered to sell oil for Euros instead of US dollars. That's a classic example of an empire ensuring the tribute continues to flow, at least until the current Emperor decides receiving tribute is a bad deal and demands every country in the world stops sending it.