A clear change in attitude has occurred among homebuyers in the United States. From having paid off their mortgages over 30 years, now one in four choose to set up a plan to pay off their debt within 15 to 20 years, as lower interest rates are allowing this.

At the same time, there are new thoughts in the financial market, that the U.S. government could possibly ignore parts of their loans. The U.S. government owns over 15% of their debt via their own Federal Reserve.

“The state has borrowed from itself, so why not just tear the bonds up? In this way, the debt immediately would be reduced by more than 2 trillion dollars.”

Money is not a mathematical or scientific phenomenon, but rather a phenomenon entirely based of trust between people. When someone gives you a 100-dollar bill you trust it has a value of one hundred dollars.

If the state asks the National Bank to print money against a bond that they at a later stage then tear up, what has happened to the trust? It is a huge risk that could lead to the destruction of the entire financial system and displays how fragile trust really is. Who wants to take the risk to go back to barter trading?

The whole idea with borrowing money is based on the concept that you can pay off the loan. A satisfied lender, a satisfied borrower is what is necessary to have a satisfied society where money functions in the form of payment and credit.

It is of absolute importance that before you borrow money, you have a plan for paying off the debt, rather than just allowing your loan to be shredded to pieces. Homebuyers in America seem to understand this attitude. / Ulf Egestrand