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What would happen if the US defaulted?
It literally cannot. It prints the currency they owe debt in. Worst case is they print a shitload of money and devalue the USD heavily and lose its status as global reserve currency, but at this rate they're heading that way anyways...
Why do people keep lending to them when the total loss of value is the most likely outcome?
Because so far the fed has remained independent, and national debt matters far less than most people think it does. Take a look at Japan - theoretically in debt WAY over their head, but the Bank of Japan is actually trillions of yen in the black and mostly invested in the Japanese economy, getting yields of 6-7% on their holdings far above their debt service. Their pension fund is a majority stakeholder in basically all internal infrastructure, and despite stagnant "growth", Japan's real wage growth is like 4-5% YOY.
As with anything economics, a single metric usually tells a bad story. Whether we like it or not, the US economy is pretty robust and even a moron like Trump can't really kill it totally in 4 years without messing with the currency directly. The downfall will be long and drawn out.
Isn't the whole fact Japan's basically had a 0% interest rate been a massive bandaid on the global economy and with them actually removing that quickly fucking everything.
Uh, vaguely, yes. They're essentially pinned to 0% because they need to get their inflation up, but that's not really caused by their national debt. They're definitely not in an enviable position overall, but their 260%+ debt:gdp ratio isn't really why.
How did you get the impression that default is the most likely outcome? Borrowing costs for the US are likely to rise, but there isn't any particular reason to expect outright default.
Because up until very recently that hasn't been the most likely outcome. In fact, that change is so recent a lot of people still haven't realized it yet.
the Debt:GDP ratio was 2.6x higher than it is now in 1980. Sure the GDP is flawed, but the U.S.'s issues are tied around wealth distribution, health, education, and the underlying bigotry being promoted by bad actors knowing it helps to keep the wealth distribution slanted in favor of the ultra rich, using it to exploit people into voting for stupid things out of false principles.
The Epstein class extracts wealth through convoluted debt schemes and rapes children. That’s their thing. That’s the billionaire club. These are the people in charge of the world.
The rich folk need a monetary system to keep score in their funny game. Make the number go up.
Btw the US spend 6.8 trillion (!) dollars from 1976 to 2007 protecting Hormuz, mostly from Iran.
12 billions in the current war, which means that in comparison to the time period between 1976 and 2007, the US is spending around the same amount per day.
I also found mentions of the cost of protection between 2007 and 2010 to be 1,2 trillion dollars, but no sources.
https://www.sciencedirect.com/science/article/abs/pii/S0301421510000194
this post was submitted on 19 Mar 2026
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