What if the US govt went bankrupt? How would that affect typical person? Would the gov. fold?

If they keep printing money the way they are at the moment, it probably won't take very long to bankrupt the country. but that won't happen. Before that happens, they will just revalue the dollar. A ten will be worth one, etc. etc. Inflation will be out of control soon and that might force a revaluation.

If we want to avoid severe hardships in the next few years, we had better start getting rid of the dead weight in the congress. You know, the folks who put us in this mess. The old timers who spend, spend, spend, take money from lobbyists, the ones who are in charge of financial committees and don't do their jobs. The dummies who didn't listen when the top economists told them there were big problems afoot.

The congressional elections this year, are probably more important than the presidential race. but you can't depend on the press to tell you about that. They just want to keep us divided and attacking and hating each other. This country is facing a severe moral bankruptcy.

Don't worry about the money, it's the morals.

Well, I'm an Australian, and I see it like this. You guys have one of the worst health care systems on Earth. There are third world countries with better health care systems than you guys, unfortunately. It's not your fault. It's the system you've got. If the US economy collapsed, the UN would probably step in to help you guys in an emergency. Big improvement in health services instantly. Military forces stationed overseas would probably come home. These well trained people with their specialist skills would be in high demand. This amazing resource would be the backbone of your new workforce. You chaps have a pretty well organised and well funded military. The US dollar would be worthless. Instead of tying value to the US dollar, countries would probably tie their currencies to the price of Gold instead, which is a lot more stable. World economies would take a huge hit, meaning that Americans with investments would be paupers. Trade would probably return to barter in the meantime, at least in the US. The world would be hit by a major recession. However, be confident that after every stock market plunge, there is an even bigger boom. Every time. Rest assured, I am sure that the United States will not go bankrupt. They are a highly organised government with some of the best educated people in the West. Your Federal Reserve has already shown it's ability to stave off financial problems by stimulating the economy with interest rate drops. (Thanks, but no thanks, by the way. Interest rates in Australia are seriously high, and your Federal Reserve isn't really helping! All this stimulating the US economy is making it worse over here). At the worst, if the government had serious financial problems, they would probably stop subsidising the US farmers. Farmers would go back to growing stuff for market price. People would buy stuff at market price, like they do out here. If a farmer can't run the business based on what they earn from running the business, they go bust. The economy would stabilise itself. In Berlin, post WW2, the Allies decided to stop setting the official price of things (the currency was cigarettes). By about noon the same day, the economy of the city had stabilised all by itself. A loaf of bread cost the same number of cigarettes all over the city! By MIDDAY! Economies are amazingly resillient things. I doubt the US will go bankrupt. Microsoft is one company, and it's bigger than the entire Australian Share market. I'm sure you're fine. If things get really bad, move over here. I'll help you with the answers to the Australian Citizenship Test! Best wishes

There are two options:

-the government can default on its debt. It can say - I'm not paying any of this debt. This could potentially lead to armed conflict with other nations that are owed by the US, but that is unlikely given current US military superiority. Many other institutions that hold US treasury debt will lose lots of money and possibly go bankrupt, but the US government will be fine and survive. The government cannot really go bankrupt since it has unlimited powers of taxation. Only if there was nothing left to tax would it really go bankrupt.

-the government could renegotiate its debt and/or sell of its assets. It can offer to pay 80% of what it owes or nothing (with a threat of default). And it can sell its many assets - this includes all federal property, including lands and buildings.

Bankruptcy is not plausible, but a debt default or renegotiation, while far off in the future, is not out of the question. Some US states and municipalities have defaulted on their debt in the past (which is why lending to states and/or cities is considered riskier than lending to the Federal government) and some other countries, like Argentina, have defaulted on their government debt and forced the debtors to renegotiate or forgive some of the debt.

I am not sure of the total effects if the government as a whole went bankrupt. I know that NewYork City went bankrupt years ago and the state of California did too. It would not fold, but things would finally have to dramatically change once and for all. Government would have to curtail all uneccessary spending and cut back to the basics. (which they should do anyway) Who knows maybe they should pretend they are in that condition now and prevent it actually happening in the future. Because it so easily could.

Wouldn't it be really ironic to see the IMF, World Bank, Chase-Manhattan and all these other global finance players literally sticking it to their own government? All this time, they've been screwing over the 3rd World, and now they'd have to do it to their very own source of stability. They would end up biting the hand that feeds them until the entire thing collapsed in on itself. It would become increasingly obvious that the police and military are working for the banks, not for "the nation."

Then, perhaps, the market would actually be free, because the bourgeoisie would no longer have a State to do its bidding, and the working-poor majority would no longer have to fear that military wing of capitalism -- cops, military, and the "justice" system.

As long as our economy isn't backed up by gold or some other precious commodity, we are essentially bankrupt already given our debt. The only thing keeping us afloat is the PERCEPTION that we will work ourselves out of this mess.

Our money is worth less than nothing. The money itself is inherently worth nothing. Whats scarier is that our currency is mostly made up of money that doesn't even physically exist - the actual physical currency is a tiny portion of our money.

If you have gold you will be fine. But what will you do when you go to the bank and they won't cash your pay check.... That is what happens. Sounds like a fun winter doesn't it.

Before the U.S would go bankrupt another country would attack us and attempt to take us over. Wouldnt be that hard since we could not make weapons to defend ourselves.

We'll find out next month.

Read up on Argentina in the meantime.

the concern is the ONLY reason why the economy is dieing right now.. -_- ppl are skepticall of stock so their pulling all the money out and crap and thats why were in this state right now..