Darrell

California's Default Is Certain

The dollar is accepted as legal tender in most countries in this world. Meaning I can use my dollars in Italy and buy their goods, services and/or assets. We don’t even have to get these dollars from earnings; our Federal Reserve simply prints more dollars when needed.

The dollar is one of the few currencies that are accepted as legal tender, globally. And this is why we have a large population of immigrants in the USofA, legal and otherwise. As of today, over 50% of all dollars are held by foreign interest.

Since the beginning of the cold war, we have been using currency to buy what we need. And we will continue to do so, until the commercial world no longer accepts the dollar as legal tender.

Our budget deficit is occurring because foreign dollars holders are using their dollars to buy our debt.

Likewise immigrants are coming here because our dollar is a global currency and we can buy what we need without having to go through the process of exchanging value for value. If our government had to fund programs through the taxation of earnings, our consumption prosperity would not have occurred and we would see a more even development through out the world.

China, Brazil, Russia and other countries have advocated that national currencies used as a global currencies be replaced with on global currency. Once this occurs then we will see our government leadership act in a fiscally prudent manner. Until then, expect more of the same.