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Message:: [QUOTE="Cloudsweeper99, post: 1324130, member: 3011"]A lot of folks assume that since there is already too much debt to ever be repaid, the most likely solution/outcome will be to inflate it away at some point by increasing the money supply.  The byproduct of this is a dollar with much lower purchasing power.  This is a good supposition.  But there is an alternative outcome which is to default on the debt.  An outright default is unlikely, but the Fed and Treasury are far more astute than people give them credit for, and they might find a way to implement a sort of "shadow" default.  This could be done, for example, by declaring void all of the Treasury securities held in the Social Security trust fund.  Or by some sort of retirement of debt held by foreign central banks in exchange for -- "something."  Or by nullifying Treasury securities held in pension funds in return for solvency guarantees.  Or by reinstituting Treasury Notes as an alternative currency to repay interest on the debt.  I'm not smart enough to figure out exactly how a default would be implemented, but I think it is probably just as likely as an inflation rate high enough to make the debt easy to repay. But be advised that this is a strictly minority viewpoint and will no doubt attract rebuttals.[/QUOTE]