debt free living

The National Debt Crisis Explained in Simple Terms


The line that scares me most is around 4:32 when he said that if banks can’t pay their bills, you couldn’t withdraw your savings.




  • Just finished watching the video. I was more concerned/confused with the ending. The video said we should all start preparing, but how? Do they expect people to buy gold? Am I supposed to bury my money in a mattress? Start hoarding food? The video was informative up until the very end.

  • I thought the explanation was a good one until they started talking about default. We won’t default; we will print money until dollar bills are worth less than toilet paper (see, e.g., the Weimar Republic, created owing more in war reparations than it could ever pay). The best hedge against this, in my opinion, is to own things that retain their value after inflation hits. Gold has historically been one such asset. Real property is another, if it is income-producing, like rentals or farmland. Stocks in denominations that will be least affected by our hyperinflation will lose value, but will still be worth more than USD. But, honestly, all of us who rely on salaries to pay the day-to-day bills will be in deep trouble, so much so that it’s probably not worth pursing these end of the world portfolio scenarios, as the downside if the world doesn’t end is often high.

    However, we are not quite there yet. We still have a chance to cut spending, and, with moderate inflation, get out of this morass. But I think the real given here is that inflation will surpass the historical 3% average for the next few years at least, and perhaps for all of our lifetimes. So borrow now if you’re gonna, and beware long-term fixed-interest investments.

  • Thanks for the video – very informative! As for your questions about not being able to withdraw savings, that’s exactly what happened when the stock market crashed before the Great Depression.

    I’m not sure I agree with the reasoning that we can’t cut spending. Yes, it’s not ideal but I think that in this situation, it’s the lesser of 2 (or 3?) evils.

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