What Happens When a Country Defaults on Its Debt?

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  • Опубліковано 7 лис 2024

КОМЕНТАРІ • 601

  • @ThePlainBagel
    @ThePlainBagel  2 роки тому +39

    Happy Friday everyone! Use the following link to get a month free of NOA's premium membership: subscription.newsoveraudio.com/subscribe?offerId=plain_bagel_stdpx_1mt&UA-cam_Influencer&TPB&

    • @AlexanderTheGoodEnough
      @AlexanderTheGoodEnough 2 роки тому

      Interesting. I always thought that debt collection is what Santa did the other 364 days of the year to pad his Christmas fund.

    • @jeffharbaugh8683
      @jeffharbaugh8683 2 роки тому

      See the November 2015 National Geographic magazine for crop yield decreases due to Climate Change. FREE movie on UA-cam "National Geographic Collapse" about the future (Peak Oil). The oil companies knew about Climate Change long before the general public, people aware of this crises are in a desperate struggle for money because of what the public doesn't yet know...Peak Oil is coming; How to survive the worldwide starvation crisis caused by Peak Oil; "What can I do"? According to the experts you should: 1A. Garden with sustainable agriculture techniques (less pesticides, herbicides and fertilizer (organic & permaculture)). B. Learn to preserve, and learn the spoil dates of different storage conditions, learn how to check for spoilage (give a little to one healthy person (not the elderly or a child) if they don't get sick...give more to another...if they don't get sick...you should be ok. 2. Buy food and manufactured goods made locally 3. Pay down debt 4. Learn skills that will be useful in the future and make friends that have useful skills you don't have (related to providing food, water, shelter, and medical care: A necessary skill is organic/permaculture gardening/farming). Very important: medicinal plant and medical skills are the best way to ensure your survival. All others will gladly sacrifice their life to protect your life, so you are around to use your medical knowledge to keep their families alive. 5. I recommend, if you can...to invest some money into technologies to increase the "carrying capacity" of the planet (high risk investments); A. decrease negative environmental impact, B. alternatives for our food system input to improve production, C. alternatives to our current living arrangements, D. alternatives to our plastics industry, E. alternatives to disaster capitalism/socialism/communism F. "Savior Technologies" (ie faster-than-light travel), "Game Changer" technologies (ie Cold Fusion Energy) & "Delaying Technologies" (ie deep sea drilling technologies). 6. I also recommend you inform and prepare your family, friends, and others. It is best to initially suggest people have an emergency kit... for any emergency such as flood, earthquake, tornado, hurricane, loss of electricity due to a winter storm. Then, if the friend or relative puts together a disaster kit, tell them about #7A/B/C 7A. THE community based organization to mitigate Climate Change and Peak Oil is: www.transitionus.org/ (For non USA; transitionnetwork.org/) 7B. The FREE movie "National Geographic Collapse" on UA-cam. 7C. Google "2052 free book download summary" www.2052.info - "A Global Forecast for the Next 40 Years". This website is a supplement to the book '2052-A Global Forecast for the Next Forty Years', written by Jørgen Randers. 7D. "Plan C: Community Survival Strategies for Peak Oil and Climate Change" Pat Murphy 7E. www.goodreads.com Three of my Facebook pages were removed, "History Channel's Prophets of Doom Mike Ruppert" and my 2 pages on the "National Geographic Collapse movie" were removed. Never give up, your families lives are at stake! I anticipate worldwide deaths at 7 out of 8 (worldwide population of 8 billion people becoming 1 billion). The US is the number one military power, number 2 economy, and a net exporter of food. Thus, I anticipate 1 out 2 will die in the US. So you just need to be above average, easy to do if you know and accept Peak Oil. In the US I estimate all those that survive the collapse will endure severe psychological and/or physical trauma. If SHTF; the Appalachian and Rocky Mountains will probably have mountain passes and bridges closed. An expert in the field of Peak Oil (Liam Nelson) felt people would willingly go into FEMA camps vs. not having any food or water. I believe it is best to consider living between the Rocky and Appalachian Mountains well away from the southern coast and especially away from where Central and South Americans will travel into the US (roads will be made obstacles and the desert is a natural obstacle). Thus, consider the northern Midwest US whith access to water (and the locals will accept you). Avoid being near nuclear reactors since the government may not shut them down. Note; many rich in the US are stockpiling resources in New Zealand to flee there (verify with Google, using credible newspaper articles). Think of a return to the Middle Ages (but with trains) or the old Western US without horses. The leaders of Bug Out Locations will deter unrest by keeping some form of the US Constitution, at the minimum the Bill of Rights. Without a Bill of Rights, history will repeat- We will have a repeat of "Game of Thrones" where the leaders constantly face assassination and betrayal. Try Facebook pages; 1. Peak Oil 2. Increasing the Carrying Capacity of the Earth 3. Organized Effort to Maximize Peak Population - OE-MP 4. Platue/Peak Population 5. Peak Oil Loners United

  • @SauceChef
    @SauceChef 2 роки тому +891

    How to colonise a country in the modern world:
    1. Lend money to a failing country
    2. (Optional: if it doesn’t fail) silently trigger their economic collapse
    3. Become the big brother and say “it’s ok, you don’t have to pay me back, but this time lemme do the work”
    4. Bring in your state-owned corporations to fill in their industry
    5. Increase in economic productivity
    6. Citizens gain your trust
    7. Overthrow government

    • @w花b
      @w花b Рік тому +119

      8. Repeat

    • @Srbenda126
      @Srbenda126 Рік тому

      Exactly what happened in my Serbia, only economic collapse was not silent. you don't even have to be silent if you have the mass media to push the narrative

    • @krillnyetheshrimpguy6152
      @krillnyetheshrimpguy6152 Рік тому +77

      Hmm, sound like a certain country...

    • @carlroberts4540
      @carlroberts4540 Рік тому +15

      Send.in.the.debth.collector.

    • @TheThreatenedSwan
      @TheThreatenedSwan Рік тому

      Just don't be a third world country managed by extremely corrupt kleptocrats

  • @idontliketoinvest
    @idontliketoinvest 2 роки тому +510

    Not sure the Russian default would be a perfect example, as it was mainly due to sanctions by the western world more like a forced default. Whereas Sri Lankan default is more like a true default as it was a direct cause of the country's poor economic performance and management.

    • @iloveprivacy8167
      @iloveprivacy8167 2 роки тому +43

      The Sri Lankan crisis was immediately precipitated by factors beyond their control, though (spike in food/fuel prices due to war).
      The Russians made their own bed, and now it sucks to lie in it.
      Sure, they thought it would go better for them: they'd roll over 🇺🇦 in 3 days, and it would all be fait accompli before any serious sanctions were imposed - but "they fought back too effectively! 😭" isn't a very compelling argument.

    • @currentaf8455
      @currentaf8455 2 роки тому +5

      I think here sl govt was unprepared for uncertainty while russian govt being resource rich could still pay it off. Besides both countries were/are unhappy or unsatisfied with their government.

    • @wafercrackerjack880
      @wafercrackerjack880 2 роки тому

      Why did they get the sanctions? Because they went to war. Did they know they will get sanctioned if they go to war? Hell yes. It was not forced, Russia knows being sanctioned and defaulting is where they're going to.

    • @rbayat108
      @rbayat108 2 роки тому +45

      I was just going to say the same thing. The Russian default occurred because their funds were frozen due to sanctions. Not a true default, they had the money to pay.

    • @wnsjimbo2863
      @wnsjimbo2863 2 роки тому +3

      it does not matter , they dont have the dollars to pay its on them

  • @novamaster0
    @novamaster0 2 роки тому +1156

    Obviously the country should just get a second job, deliver pizzas on the weekend, needs to have a garage sale, and just use the debt snowball method to pay off their debts and build the psychology of being fiscally responsible

    • @xenthia
      @xenthia 2 роки тому +14

      Lol

    • @effctoocool9763
      @effctoocool9763 2 роки тому +98

      Cancel netflix 😂

    • @graham1034
      @graham1034 2 роки тому +110

      Cut down on that avocado toast

    • @joshlanders
      @joshlanders 2 роки тому +85

      Countries these days have no work ethic. /s

    • @xiphoid2011
      @xiphoid2011 2 роки тому +59

      actually, those methods (get a second job = raise taxes, fiscally responsible = cut military/welfare spending, snowball = pay off the highest rate loan first) all would be sound advice.

  • @adrianliew8076
    @adrianliew8076 2 роки тому +31

    Hey Richard, just want to say thanks for all the genuine videos you have been sharing for the past! Appreciate the way you present the topics with your professionalism, not overcomplicated layman term, and with a sprinkle of bagel humor. Keep up the great work!

  • @SamuelBSR
    @SamuelBSR Рік тому +66

    0:26 You actually can. Russia did not default on its debt, it was not allowed to pay instead. Russia pushed a money transaction and it had enough money but the transaction was declined by the Western banking system. In order to pay back, Russia suggested that the borrowers get paid in Rubbles directly bypassing any artificial restriction. So, everybody who wanted their money back probably got them directly from Russia.

    • @dannybeane2069
      @dannybeane2069 Рік тому

      Yeah just good luck going into Russia, getting your money, and then leaving the country with all of your limbs, fingers, and/or genitals.

    • @SamuelBSR
      @SamuelBSR Рік тому +3

      @@dannybeane2069 we are talking about institutional loans. Some foreign institutional investor bought Russian debt, they can get payments directly from Russia avoiding western infrastructure. There is no reason to go to Russia to accomplish it.

    • @David-fj5lz
      @David-fj5lz Рік тому

      But how does the Rubble equate to the dollar in the debt repayment?

    • @Anon-jt1kl
      @Anon-jt1kl Рік тому +4

      @@David-fj5lz that’s why Russia and China and many countries are ditching the dollar. They no longer want to be held responsible for the US poor financial decisions. They are introducing their reserve currency in august while the us will default on its debt in June (if they don’t raise the debt ceiling)

    • @aycc-nbh7289
      @aycc-nbh7289 Рік тому +1

      But what use do rubles have outside of Russia?

  • @kenxclout
    @kenxclout 2 роки тому +105

    I have the best debts in the world!
    Every single one of them is Outstanding!

  • @ryanendoh8750
    @ryanendoh8750 2 роки тому +229

    Can you do a follow up video on the implications to stocks and bonds held by investors (in both debtor and creditor nations) when a country defaults?
    Thumbs up if you'd like this too.

    • @akapoka8732
      @akapoka8732 2 роки тому +3

      I’d imagine the situation is a tough one 😂

    • @Velumbra
      @Velumbra 2 роки тому +1

      That'd be pretty interesting.
      I hope buddy or somebody for that matter covers the topic.

    • @phuocluong7974
      @phuocluong7974 Рік тому +1

      The answer to your question would depends on how the country plans to get out of the default. There are three major ways in which a country can do that:
      1. Get bailed out by other countries, this is usually coupled with austerity measures and some debt negotiation with creditors (Greece for example)
      2. Print out money to pay the debt (USA will likely resort to this if it comes to it)
      3. Refuse to pay the debt and risk unable to sell any further bonds in the future (Russia is kinda doing this right now)

    • @phuocluong7974
      @phuocluong7974 Рік тому +1

      As for the consequences:
      1. Stocks usually goes down due to lower government spending and higher taxes. Bonds prices goes down because most of them will not be paid back on their full face value. A lot of hedge funds actually made huge profits buying Greek bonds during the crisis and sell the bonds as the Greek economy starts to stabilise.
      2. This would interesting one because money printing would lead to inflation. Which could either rocket boost stocks or make it goes down depends on the % of inflation. Bonds prices would go down because new bonds issued would have higher interest rates.
      3. Stocks prices will depends on whether the economy is self-sufficient. If it’s not then stocks prices will collapse. If the economy is self-sufficient (little to no international trade), then stocks would likely remain the same. As for bond prices, the assumption would be that it is zero as government is not paying back debt and no one is willing to lend government money.

  • @qwertyuiop-cu2ve
    @qwertyuiop-cu2ve 2 роки тому +31

    Pretty much comes down to it that the most you can do is to not lend anymore to that party ever again. You still lost your money and they can live happily ever after if they can manage without your cooperation.

  • @Fenix-fg6cs
    @Fenix-fg6cs 2 роки тому +19

    Thanks a lot! I would love a more in-depth video about this topic, like a history of government defaulting, why it happened, etc

  • @idraote
    @idraote 2 роки тому +17

    IMF are financial sharks. The miracle is that countries are actually able to recover after getting IMF """help""".

  • @hendrikheim5665
    @hendrikheim5665 2 роки тому +120

    Russia one was a bit silly of an example, as their debt is in a limbo, they could pay it but the recipent doesn't want it.

    • @idrathernot_2
      @idrathernot_2 2 роки тому +42

      This, Russia is willing and able, it's US shenanigans at play.

    • @dean_l33
      @dean_l33 2 роки тому

      But it's climbing, shenanigan or not

    • @hendrikheim5665
      @hendrikheim5665 2 роки тому +1

      @@dean_l33 What is?

    • @potatofuryy
      @potatofuryy 2 роки тому +15

      They want to pay in the wrong currency lol. That doesn't count.

    • @Srbenda126
      @Srbenda126 Рік тому +5

      @@potatofuryy No they wanted to pay in original currency but it was frozen. THen they wanted to pay in rubles, they didn't want it neither

  • @bestgirlie09
    @bestgirlie09 2 роки тому +92

    What's needed? Liquid cash. Everyone only has credit. If you have stacks of cash, you can capitalize on everyone's credit. A recession as bad it can be, provides good buying opportunities in the markets if you’re careful and it can also create volatility giving great short time buy and sell opportunities too. This is not financial advise but get buying.

    • @kozovski6628
      @kozovski6628 2 роки тому +6

      Cash can be king , but it depends on how much you have. I.E- if you have 300,000 cash when the house market crash occurs you will have a LOT more opportunities VS many others especially when people get foreclosed.

    • @AmandaMichelle.
      @AmandaMichelle. 2 роки тому +4

      When the stock market rebounds, many investors may come to regret not investing in the red today. It's possible that this pricing will never be seen again. If you have a fantastic vision for it, there is always opportunity in the midst of chaos.

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      @hobbs252 2 роки тому +2

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    • @hobbs252
      @hobbs252 2 роки тому +2

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      @Green-ed7wq 2 роки тому

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  • @agustincarrasco5372
    @agustincarrasco5372 2 роки тому +24

    The World Bank and the IMF both started from the Bretton Woods conference in the 40’s, which came about because the U.S dollar, as a result of war-fleeing European gold, had so many gold reserves backing it. Inevitably, however, inflationary Keynsian policies-which the Bretton Woods Agreement was founded on-plagued the U.S dollar and, much like Britain during WW1, the U.S defaulted on its gold IOUs and Nixon went off the gold standard in the 70’s.
    The IMF and the World Bank are essentially American and fully backed by dollars. So, when you control the global reserve currency-and with it, all these international funds/banks (e.g., IMF and the World Bank)-it begs the question: what happens when the biggest debtor of all defaults?

    • @simonfrancis110
      @simonfrancis110 2 роки тому +6

      worldwide recession

    • @Madafaca6969
      @Madafaca6969 2 роки тому +9

      "oopsie woopsie we did a fucky wucky
      also, we have like a million soldierd so chill the fuck out"
      something like that I imagine

    • @got2kittys
      @got2kittys Рік тому +1

      Financially, the waste hits the air mover.

    • @howardbaxter2514
      @howardbaxter2514 Рік тому +1

      @@got2kittys society will essentially get the FUBAR treatment

    • @TheSuperBoyProject
      @TheSuperBoyProject Рік тому +3

      Fleeing european gold is one hell of a way to say looted German gold by Germany's opponents.

  • @saynotop2w
    @saynotop2w 2 роки тому +16

    Sri Lanka politicians are living cushy in America while the nation is in turmoil.

  • @nirmaljayasuriya9472
    @nirmaljayasuriya9472 2 роки тому +45

    From Srilanka, thank you for covering this,

    • @me0101001000
      @me0101001000 2 роки тому +5

      Hope all of you will be alright, mate. Stay strong!

    • @williamcase426
      @williamcase426 2 роки тому

      don't die

    • @ep9203
      @ep9203 6 місяців тому

      I was in Sri Lanka 2 years ago.. Beautiful place! I hope everything turns around for you guys..

  • @johnnewsom2059
    @johnnewsom2059 2 роки тому +111

    Russia was forced into default, Sri Lanka might be able to settle/restructure the debt with Japan.

    • @elonmusk8673
      @elonmusk8673 2 роки тому

      Hello giving out 5-10eth be part of the 5 lucky persons

    • @migooknamja
      @migooknamja Рік тому

      Russia had the money to pay its debts, but the money was frozen/stolen and the media declared that they "defaulted".
      Lender: Hey Russia! You owe us money!
      Russia: Yes. Please give me your wire instructions
      Lender: We don't do business with Russians!
      Absolute Clown World- brought to you by the Democrats

    • @fueback6261
      @fueback6261 Рік тому

      @@elonmusk8673 gimmw and dont ask for money 😂

  • @Nobody-e6e
    @Nobody-e6e 2 роки тому +35

    I am Greek and I approve this video.

    • @DeedoDoop
      @DeedoDoop 2 роки тому +2

      GERMANYYYYY

    • @logank444
      @logank444 2 роки тому +12

      Greece needs to get a second job and stop being poor

    • @grimaffiliations3671
      @grimaffiliations3671 Рік тому +2

      greece messed up when it abandoned its currency to join the Euro

    • @Nobody-e6e
      @Nobody-e6e Рік тому +2

      @@grimaffiliations3671 i agree

  • @CaedenV
    @CaedenV 2 роки тому +1

    The new delivery is, as always fresh and warm! Exactly the way I love my plain bangles!

  • @brandobatel
    @brandobatel 2 роки тому +5

    He moves his hands and arms so much. He must be Italian

  • @JohnDoe-ph6if
    @JohnDoe-ph6if 2 роки тому +36

    Really surprised me when you used the rare 'денюжку' instead of 'деньги') almost nailed the pronunciation too! Great video as always

    • @timtrainage
      @timtrainage 2 роки тому +6

      Really? I thought it was awful

    • @alexkaramov6342
      @alexkaramov6342 Рік тому +2

      ​@@timtrainage ye Im russian and I didn't understand what he said

  • @n0code
    @n0code 2 роки тому +7

    Russia didnt default beacuase it didnt have the money, Russia defaulted because it literally couldn't make its payments because of the sanctions you know.

  • @Max-ve5tu
    @Max-ve5tu 2 роки тому +159

    The story about unregistered swimming pools in Greece goes to illustrate how selfish the Greek population was and how incompetent the government was at collecting those taxes.

    • @wanderingthewastes6159
      @wanderingthewastes6159 2 роки тому

      Yeah, how dare they no give their hard worked money so the public machine could eat 30% of it and the absolutely rotten Greek politicians another 20%.

    • @WellBattle6
      @WellBattle6 2 роки тому +25

      @@robertmusil1107 At least France paid for the machine learning software to identify them. Greece just spent all their time holding elections.

    • @Max-ve5tu
      @Max-ve5tu 2 роки тому +40

      @@GeorgeWashingtonLaserMusket What if everyone starts to think like that? Then nobody wants to pay taxes, sales taxes, highway fees, etc. Just pay what you are supposed to instead of trying to trick the system. There is enough for everyone to go around if you aren’t so greedy.

    • @pebblepod30
      @pebblepod30 2 роки тому +7

      @@Max-ve5tu
      This video create made a mistake here.
      In Greece,federal taxes pay for spending, the Greek govt does not have a central bank that creates Euros, and they have no power at all over ECB that does.
      That is completely different to the US, where FEDERAL taxea do not pay for govt spending.
      Think about it.
      It is VERY VERY different when a Govt borrows in a foreign currency it does not create, vs a currency it does create & their central bank cannot say no. Then its "borrowing money from yourself in a currency you create".
      See The Deficit Myth by Stephanie Kelton for more info

    • @wanderingthewastes6159
      @wanderingthewastes6159 2 роки тому

      so they spent money to suck more money? Boy let me tell you

  • @JuanManuel-nm1ch
    @JuanManuel-nm1ch 2 роки тому +20

    Me, an Argentinian guy watching this: rookies

  • @rommaninc
    @rommaninc 2 роки тому +44

    That Russian needs a bit more practice.

  • @TheMrFishnDucks
    @TheMrFishnDucks 2 роки тому +17

    Great video. Very informative. Keep up the good work.

  • @weksauce
    @weksauce 2 роки тому +4

    lol, "dingey, pojalsta" is more anglicized pronunciation of "money, please" in Russky

  • @brujua7
    @brujua7 Рік тому +17

    The video topic is very insteresting and well made, but it would have been awesome if you covered more previous examples of countries defaulting

  • @AtlasTheStoicSage
    @AtlasTheStoicSage 2 роки тому +16

    I 😓always wondered about the United States and the trillion dollar of debt it owes. The U.S. raised the debt ceiling to avoid a default. There is also the federal reserve which prints more money 💵 to lend out to the government which may be a Ponzi scheme at an international level🫡🧨. 🤔 there are other factors contributing to a countries default on 💸 debt.

    • @grimaffiliations3671
      @grimaffiliations3671 Рік тому

      ?

    • @grimaffiliations3671
      @grimaffiliations3671 Рік тому +2

      @@jwdory "way out" implies we're in trouble. We're not. The national debt is just a stockpile of US treasuries so it could just as easily be called the national savings account. And it's nonsense to say the US is close to insolvency

    • @grimaffiliations3671
      @grimaffiliations3671 Рік тому +1

      @@jwdory No we're not. Schweikert is a politician with little understanding of how the federal government operates as a currency issuer

  • @treyshaffer
    @treyshaffer 2 роки тому +27

    HAHAH hearing you speak Russian at 0:29 деньги пожалуйста was amazing thank you so much for that lmao

  • @julianheinrich7567
    @julianheinrich7567 2 роки тому +12

    Good video. Actually informative and the ad really did not bother me at all. Well done. I actually learned something.

  • @peterbakarePB
    @peterbakarePB 2 роки тому

    love the delivery

  • @QwkDraw
    @QwkDraw Рік тому +1

    DEPENDS! Is THAT country the 'reserve currency'? Well then, we're SCREWED!

  • @timbit827
    @timbit827 2 роки тому +1

    The video was the perfect length of time for me to wash dishes and learning something new.

  • @gerwyntiberius1918
    @gerwyntiberius1918 Рік тому +1

    Why can't a new government refuse to pay back the debts incurred by a prior government. Considering it was not them who took the loans but a prior government couldn't they claim they don't owe it back?

    • @samsonsoturian6013
      @samsonsoturian6013 7 місяців тому

      Define new government. France counts every administration as a government.
      And no one knows. For instance, Communist China claims to own everything formally belonging to the Republic of China except its debt. However, the Russian Federation accepted ownership of all debts of the USSR

  • @archingelus
    @archingelus 2 роки тому +2

    also point of clarification: Russian defaulted mostly because the payment was not receivable from the sanctions not because they are not capable of paying, whether they were NOT willing to pay however is another matter

    • @dundun8640
      @dundun8640 2 роки тому

      Dude, they invade countries because they want to, i'm pretty sure they won't pay if given the chance.

    • @archingelus
      @archingelus 2 роки тому

      @@dundun8640 so again, in my comment, i stated clearly, whether they have the willingness to pay is completely different matter, also ABSOLUTELY different matter is the political decision to invade or wage war, there are no correlation other than the resulting sanctions in my point,
      my scope is strictly from economical point of view, not from the point of any other countries being invaded, or the point of view and decision of a madman to wage a war
      even if they wanna pay, they can't and now the sanction is being turned upside down infact now you got to use their currency if you want gas, so, BUGGER LOL

  • @FrankBowness
    @FrankBowness 2 роки тому +1

    Nice video Richard! Hope all is well

  • @earthling_parth
    @earthling_parth 2 роки тому +2

    Thanks for covering this situation. Highly appreciate the new delivery method too 👏

  • @successfulusername
    @successfulusername 2 роки тому +1

    So… what’s your thoughts about t-rowes emerging Europe market fund? Think it will recover once the war is over? Will sanctions lift?

  • @abubakarsharif5993
    @abubakarsharif5993 2 роки тому +51

    I wouldn’t make a comparison between Russian “default” with the SriLankan one. Russia had the money however due to sanctions were not able to give the payment in US dollar.

    • @kvikende
      @kvikende 2 роки тому +11

      True but Russia still didn’t pay so for the owners of the debt russia defaulted.

    • @josephhoward4697
      @josephhoward4697 2 роки тому +17

      A default is a default.

    • @Matt_History
      @Matt_History 2 роки тому +12

      @@kvikende not really. Most countries would disregard a default that's outside of a nation's control. Especially if they're an exporter. Like Russia

    • @TheManinBlack9054
      @TheManinBlack9054 2 роки тому +11

      @@josephhoward4697 well, those are two different kinds of default: a technical one and an actual one

    • @mynameismynameis666
      @mynameismynameis666 2 роки тому

      @@josephhoward4697 who decided the default? rating agencies? how trustworthy are these historically, because i know at least 5 cases in which countries sent delegation with bribes in order to change their countries ratings... usually the rating only changes once the government is not aligned with US/UK warmongerers and color revolutionaries...

  • @Robliss
    @Robliss 2 роки тому +1

    Great vid. easy to digest. Cheers!

  • @daanishdan318
    @daanishdan318 2 роки тому +42

    Point of Clarification: World Bank invests in projects. IMF does bail outs. The nature and purpose of the two are very different. Also, it is alleged that the two are basically US's version of leveraging up international funds - they voting/influence is directly tied to the funds contributed. And US remains the largest contributor. Due to this, they are hesitant to give Sri Lanka money if it is being used to pay back China.

    • @migooknamja
      @migooknamja 2 роки тому

      Start using silver and gold as currency and break the shackles of being in debt to globalist banks

    • @arthas640
      @arthas640 2 роки тому

      I dont blame them for being hesitant, China is the single largest borrower from the IMF and World Bank. China is essentially borrowing from america to steal American customers and american tech so they can compete against America on the world stage, and this is after decades of american business investment in China

  • @ernestogiusti5802
    @ernestogiusti5802 2 роки тому +2

    Don,t cry for me Argentina... oops, sorry
    Don't cry for me Sri Lanka. And Zambia. And Lebanon, and...

  • @teleman07
    @teleman07 2 роки тому +1

    Great shirt.

  • @faisalejaz3326
    @faisalejaz3326 2 місяці тому

    Dear sir, if a country get defaulted then what would happen to investors money in stock exchange market and bank savings accounts?

  • @roaringfork
    @roaringfork 2 роки тому +27

    Didn't the Russians default because it wasn't possible to pay after being kicked out of swift? That's technically a default....but what happens?

    • @josephhoward4697
      @josephhoward4697 2 роки тому +2

      Lending rates go up, as people see the investment as riskier. This makes loans harder to access.

    • @TheManinBlack9054
      @TheManinBlack9054 2 роки тому +1

      True, Russia has the money to pay, but the US just blocks all transactions.

    • @renanfelipedossantos5913
      @renanfelipedossantos5913 2 роки тому +2

      Yes, regardless of the reasons that lead to non payment, lending becomes riskier and therefore more expensive.

    • @tomlxyz
      @tomlxyz 2 роки тому +2

      I think it has more to do with freezing Russia owned currency reserves outside of Russia. I think most of Russias currency reserves are outside Russia

    • @thatonedudenextdoor7840
      @thatonedudenextdoor7840 2 роки тому

      Russia will borrow less from the west and more from China, pushing them further towards China therefore long term strengthening China.

  • @kingstonchi
    @kingstonchi Рік тому

    My uncle Joe gets asked a lot, as he is a banker, and we heard him say a hundred time .. What happens when a loan is in default ? Three possible outcomes .. You get all the money back, or you get none of your money back, or you get something in between ..

  • @vasilikimanoli9285
    @vasilikimanoli9285 2 роки тому

    In Greece we had to fid out all that information the hard way a few years ago...

  • @ZAR556
    @ZAR556 2 роки тому +3

    Sri Lanka government defaulted,,
    the culprit dynasty still enjoying life like usual

    • @fizzybubblech2128
      @fizzybubblech2128 2 роки тому

      It wasnt just the. It was the ill advise of the world bank and economists like stiglitz to go all organic. Always remember - in most events, the US or at least some of their elite - has a hand.

    • @starrynight43451
      @starrynight43451 Рік тому

      The dynasty actually tried to avoid a default. There were many NGOs funded by George Soros, that spoke infavor of a default.

  • @Matt_History
    @Matt_History 2 роки тому +108

    The inflation example is backwards, you showed deflation. If .5 M= $1 then the debt would effectively be cut in half and only be 500 million

    • @ThePlainBagel
      @ThePlainBagel  2 роки тому +100

      You're right, thanks for highlighting. Working on fixing it now.

    • @sharan9993
      @sharan9993 2 роки тому +5

      @@ThePlainBagel Yeah u said it correctly but graphics was reversed 😂
      Anyways as always grt video. Keep up the good work. Thank you for breaking down complex economic topics.

    • @bdubb5390
      @bdubb5390 2 роки тому

      He's propaganda. Probably cia, bit who knows.

    • @deebil8099
      @deebil8099 2 роки тому

      @@ThePlainBagel Please make a video on capital flight from a country and explain how it effects their currency and effect on their economy. You briefly mentioned this hypothetical situation in the video but I think this is an interesting and important macro economics topic now that the dollar is strong and a lot of other currencies are down.

    • @yuvrajguglani821
      @yuvrajguglani821 2 роки тому

      i just thought he was referring to debt denominated in foreign currency like a lot of the world debt outside the US is denominated in USD.

  • @dundun8640
    @dundun8640 2 роки тому

    The way you said that russian phrase, doood that was so bad, like literally the worst but in a way, kinda holds itself up there

  • @spacekettle2478
    @spacekettle2478 Рік тому

    @10:33
    Greece: Hey guys, I have an idea!

  • @misterzetius7240
    @misterzetius7240 Рік тому +1

    Technically, Russia hasnt defaulted, it has resources to pay dept, just no one allows it to do so.

  • @aCycloneSteve
    @aCycloneSteve Рік тому +1

    Russia "defaulted" but they had the money but couldn't pay because their payment would be frozen by the West before it's used to pay the debt. Not quite the same thing.

  • @chat-1978
    @chat-1978 2 роки тому +2

    There is no country that has benefited from IMF action unless there were drivers similar to Belgium.
    Biggest issue is that these saviours don't just drive sanitation of the country's organisation but force the sellout of expensive infrastructure that is usually of national interests. This is where the sovere6 principal is thrown out of the window.
    For example, Greece had to privatise all airports, some of them being military bases as well. Also the haircut was virtual. Practically the debt was moved in the future with some Troika creative economics.
    But I like your relative impartial approach in the topic. Probably you've already read it, but anyhow consider reading "the shock doctrine" for the IMF history.

  • @rightwingsafetysquad9872
    @rightwingsafetysquad9872 2 роки тому +18

    The last time Russia defaulted on its debt, Khrushchev had to pay for his Pepsi addiction with obsolete naval vessels. For a few months Pepsico had the 6th largest navy in the world. The fact that Coca Cola still exists is remarkable.

    • @bigpapagorge9667
      @bigpapagorge9667 Рік тому +5

      no
      this is entirely wrong
      the deal never went through, the ships were not warships, but cargo ones, and even if the deal went through, at the time, it’d be around the 22nd-24th largest navy in terms of both tonnage and size

    • @AjarTadpole7202
      @AjarTadpole7202 Рік тому +1

      Thats wrong on so many different levels

  • @JoelReid
    @JoelReid Рік тому +1

    One of the most invaluable historical methods to avoid debt was slavery. by engaging in slavery then a country could use the cheap labour (slaves are not technically free, they are just very cheap) and build infrastructure to recover from economic downturn and supply businesses with alternate options. When you see ancient civilizations you will notice those that avoid slavery for extended periods of time get more debt.
    In fact, countries could allevieate their debt to other nations by supplying slaves to them volluntarily.
    I am not advocating slavery, rather just pointing out that the modern world post industrial age is a new and crazy place.

  • @benjamins2458
    @benjamins2458 4 місяці тому

    Making it difficult to borrow money in the future is a positive side-effect, not a negative!

  • @ghb323
    @ghb323 Рік тому

    3:27 the country version of *ah long* from Malaysia and Singapore

  • @gogo-cx9xc
    @gogo-cx9xc 2 роки тому

    you should do a video about "simply wall st", I want to know what you think about it, do you think its reliable or just ya know, not reliable

  • @bartoszdolewski4915
    @bartoszdolewski4915 2 роки тому

    So country can't go on sale?

  • @DeVallaR
    @DeVallaR 2 роки тому

    Commenting from the defaulted economy :D

  • @helpyourcattodrive
    @helpyourcattodrive Рік тому

    Everything is a mess..

  • @aemeromedia
    @aemeromedia 2 роки тому

    cool post!
    💪

  • @hiddenname9809
    @hiddenname9809 2 роки тому

    See? We make the countries accountable. We need to make individuals accountable as well.

  • @odinsrensen7460
    @odinsrensen7460 2 роки тому +36

    I always thought that Greece could at least pay back some of it's debt with clay. I'm sure the Germans would like some Aegean holiday islands.

    • @vasilikimanoli9285
      @vasilikimanoli9285 2 роки тому +15

      This is actually very close to what has happened. The greek government was forced to put all valuable land and public wealth (as the water supply service) to a big fund and then sell it to foreign corporations (mostly German) to pay out its debt.

    • @potatofuryy
      @potatofuryy 2 роки тому +5

      @Babd lmao

    • @Lawrence330
      @Lawrence330 2 роки тому +9

      @Babd Ah yes, let's not learn from our history. Never mind the fact that the "victors" plundered Germany's wealth after WWI (reparations), directly enabling the environment that enabled the 3R to come into power in the first place.
      Besides, it's not like the Greeks are any strangers to plunder. They were a world power once...

    • @CountingStars333
      @CountingStars333 2 роки тому +3

      @@Lawrence330 Return the Great star of Africa while you're at it.

    • @Jose04537
      @Jose04537 2 роки тому +4

      @@Lawrence330 Well, Germany kind of deserved it. That tends to happen when you miscalculated the posibility of you losing a war you voluntarily decided to participate in.

  • @nrpbrown
    @nrpbrown 2 роки тому

    Very interesting video

  • @Magdalene777
    @Magdalene777 2 роки тому +3

    They should have aggressive collection agents call Putin constantly.

  • @michaelthoma4423
    @michaelthoma4423 2 роки тому

    what's with the noises in the background?! other than that, great vid

  • @chaffejcarraway
    @chaffejcarraway 2 роки тому +6

    I was listening while driving and that car horn when you did the Canada thing scared me. I thought someone's blowing horn at me!

  • @jinchoung
    @jinchoung 2 роки тому +1

    very informative. always wondered about this issue.

  • @HeavenHalos
    @HeavenHalos 2 роки тому

    Very good video.

  • @malcolmsilva
    @malcolmsilva 2 роки тому

    Mostly algorithm comment, but also format is good 👍

  • @arzhenal1
    @arzhenal1 2 роки тому

    Nice new setup!

  • @lain11644
    @lain11644 2 роки тому

    Interesting video!

  • @deletedaxiom6057
    @deletedaxiom6057 2 роки тому +3

    One thing that i find confusing is when it is said, that the country can't buy fuel or medicine.
    Are you saying the government is importing food and medicine then selling it? I always thought some company X bought the food and medicine and sold it. I thought governments only taxed/tarriffed the imports.

    • @testacals
      @testacals 2 роки тому

      In Sri Lanka at least, all fuel importing companies are owned by the government. So yeah, the government is importing it and then selling it. I am pretty sure this is the same for medicine in SL but I could be wrong.
      I am not exactly sure how imports from normal companies work but I have heard that the government need foreign reserve to even make those imports happen.

  • @emmanuelrajah7329
    @emmanuelrajah7329 Рік тому

    Golden Point - Next Time, When Anybody Brags about How Powerful their Army is......Politely Remind them that their Army was Too Chicken or Cowardly to Send 1 Soldier with Binoculars against Villagers with Knives, Swords etc...

  • @RealishNPC
    @RealishNPC 7 місяців тому

    I have a question, so my mom showed me a 10,000 peso bill that apparently was used many many years ago in Mexico, and as most of know now days I think the highest bill is around 200 pesos, does anybody know exactly what happened here? And when? Or a video that explains things like that, thank you

  • @salardz
    @salardz Рік тому +2

    Thank you for all of your videos; they have taught me a lot. I'm looking for an explanation. Why are governments in debt in the first place? They have all the resources! I understand that printing more money to pay it off is not a viable option. but I cannot figure out how it works.
    Can you please elaborate on this, or do you have any specific videos that you can recommend?
    Thank you very much.

    • @ilhamsyamsuddin
      @ilhamsyamsuddin Рік тому +1

      Based on my limited understanding, It is because getting a loan is much easier and faster than collecting taxes.

    • @ryanprov
      @ryanprov Рік тому

      I think a big part is that government deficit spending is very popular now - look at the US. Governments only tend to balloon in size unless something drastic happens. When you can borrow money to an almost limitless degree, and getting re-elected depends on how much you can promise to spend, it’s no wonder they borrow insane amounts.
      If you look at the history of government budget deficits, this era of insane borrowing is really a recent thing. The US for example had a budget surplus as recently as 2000 (not zero debt, just not adding to the debt). Previously, massive budget deficits really only showed up around the world wars. Now Covid has resulting in a crazy amount of spending but it’s not just that, we’ve been running at a significant deficit for the last 20 years or so.
      I think government borrowing is attractive for the same reason personal borrowing is: you get the money now. And when your interest rate is super low and there’s not much your creditors can do if you default, plus almost anyone will lend you money because you have a “perfect” credit score (despite only ever borrowing more and more), it kind of makes sense. If you could borrow $10M right now at 1% and you pay it back in 200 years or whenever you want, and if you default your creditor has to come pick a fight with your entire town to get anything back… wouldn’t you do it??

    • @salardz
      @salardz Рік тому +1

      @@ThomasVWorm Make sense.Thanks for explanation, :)

    • @ryanprov
      @ryanprov Рік тому

      @@ThomasVWorm yes makes sense but eventually you do have to do the "tax to pay back your debt" part 😁 you could still run a budget surplus doing this by just paying back your debt in the same year, or relatively quickly anyway. If you only ever borrow the debt will obviously just keep growing. And if you stretch it out over decades then a different generation of citizens end up paying the debt that the previous generation received a lot of the benefit for.

  • @seanlander9321
    @seanlander9321 Рік тому +1

    Do as the French do and just walk away from debts, it’s much easier than paying or going broke. When asked about why they don’t pay sovereign debt the French just offer abuse in reply. They have trillions in unpaid loans that haven’t had a penny paid on since 1931.

    • @LiterallyEveryone217
      @LiterallyEveryone217 Рік тому

      The only problem is they are a major global power but honestly just America's main embassy to Europe

  • @sparkyfromel
    @sparkyfromel 2 місяці тому

    I has happened a lot in past history , for centuries !
    it end always the same , a serious bit of haggling about the size of the hair cut for the borrowers
    the bigger the country the smaller the hair cut

  • @mekbibtagesse8466
    @mekbibtagesse8466 10 місяців тому

    Whats your opinion on the case of Ethiopia which joined the list in the past week?!

  • @natashadickson4819
    @natashadickson4819 2 роки тому

    Good video

  • @formulah113
    @formulah113 2 роки тому +1

    what happens? their currency goes from being one of its self to zero of its self. people start bargaining for 👖 and Jerry crawls all the way home because "it kept working."

  • @ar4122
    @ar4122 Рік тому

    Just found you....like your content

  • @currentaf8455
    @currentaf8455 2 роки тому +1

    Causes (its never one.)
    Forex depletion : us raising rates hurt fdi ,
    poor tourism 3rd largest forex source ,
    Russia Ukraine war,
    Currency depreciation partly bcz of us raising rates and demand for dollars.
    from forex supply side and
    dependence -on increasingly expensive- for food (esp bcz switching to 100% organic farming decimated food production),energy
    increased the forex demand.
    Chinese projects mostly either unviable financially or vanity projects /political projects.

  •  2 роки тому +1

    Hey Richard, can you talk a little about MMT?

  • @contentweaverz2438
    @contentweaverz2438 Рік тому

    Bond is an unregistered security. Also, if everything is cake then cake is unregistered security.

  • @videovivo1154
    @videovivo1154 2 роки тому +1

    Argentina: First time?

  • @brucefisher3199
    @brucefisher3199 Рік тому

    A country that borrows in its own currency can’t be made to go insolvent.

    • @samsonsoturian6013
      @samsonsoturian6013 7 місяців тому

      If the currency goes worthless it's the same thing

  • @maxheadrom3088
    @maxheadrom3088 3 місяці тому

    That country will have a hard time get a foreign loan again - that's why Srilanka's case is different than Russia's: Putin has no expectation of getting a foreign loan from the West so defaulting makes no difference. Also, they already have Russia's money in their hands.

  • @kenxclout
    @kenxclout 2 роки тому +26

    I'm so much in debt, I can't afford to pay my electric bill...
    These are the darkest days of my life..

    • @TojiFushigoroWasTaken
      @TojiFushigoroWasTaken 2 роки тому +5

      "Let there be light!.....until you pay your electricity bill"
      - Jesus , that book every keeps quoting [21:8]

    • @josephhoward4697
      @josephhoward4697 2 роки тому +2

      Do not worry. The sun will shine again.
      You did pay your sun bill, right?

  • @D_Winds
    @D_Winds Рік тому

    Fitting that I see this before the great US collapse of June 2023.

  • @LuizFernando-ee3ub
    @LuizFernando-ee3ub 2 роки тому

    Make a video about Argentine inflation

  • @Paddythelaad
    @Paddythelaad Рік тому

    it seems like almost every country is in debt. I pretty much never hear of countries that are in credit, historically governments lended money out to other ones, do they still?

  • @Mrmaverickism
    @Mrmaverickism Рік тому

    Saying countries default because they are already in a bad financial situation without saying getting massively in debt IS the bad financial situation is misleading. The system of usury is not sustainable and is eating itself alive

  • @petargolubovic5300
    @petargolubovic5300 2 роки тому +12

    Love the new format, mr bagel! The information was very digestible, yet concise. The only fault was, as others noticed, this.

  • @justcommenting4981
    @justcommenting4981 2 роки тому

    Ah so delightfully banal. Debt restructuring and austerity measures. I was surprised to hear you mention nationalizing resources when usually the demand is the opposite. Privatization of formerly nationalized resources and frequently privatization of public sector services like utilities. Does Sun Tzu ever mention debt, or is it too devious a weapon?
    Good video, if a bit dry.

  • @Raggart
    @Raggart 2 роки тому

    Love the new format!

  • @thorin1045
    @thorin1045 Рік тому +1

    well, it is even more tricky in the russian case (sri lanka is the classic case of country not being able to pay,) as they are not out of money, just the lender decided they do not accept the money russia has, and also the lender do not want to change the money they have, and not because it is valueless (like in the late soviet era), but because reasons.
    who is the fault, if one side cannot pay, because the other side prevent them. if i have a loan to a bank, and the bank literally do not accept my otherwise perfectly normal payment, than did i missed my loan payment, or is it the banks fault?