But maybe it's not all so terrible? Technically America can pay off its debt, no matter how large it is, at any time. The thing is, that the very government debt is denominated in US dollars, which the Federal Reserve can print as much as necessary and pay. Of course, it will cause many other problems such as an increase in inflation and a removal of the dollar from the pedestal of the world's reserve currency. Yet in this way the debt can be paid off, and it gives hope to the creditors that the probability of a sudden default is very low.Since the election of President Donald Trump appeared another alarming fact - yield of US Treasury rushed up and is now close to multi-year highs. This increased the cost of debt service, and one of the priorities of the new government should be the solution to this problem.
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