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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum
GLD 379.91+0.4%Nov 11 4:00 PM EST
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To: Joseph Silent who wrote (145317)1/11/2019 11:20:14 AM
From: Haim R. Branisteanu  Read Replies (1) of 217699
 
Joseph, you received an adequate answer from Horgad. The underlying strength of a currency and a country debt is the perception of those lending the money about the ability of the respective country to pay back its debt. It is mostly based on credibility and nothing else when the debt to GDP crosses the threshold limit that some put it at 100%

Many years ago we had on SI a discussion related to what best reflects a store of value. Something that is unaffected by debt. Many promoted precious metals which I personally dismiss as you cannot eat it or transact it and the value is a perceived value.

What you mention in your question is basically what will be the perception of the market participants that China will pay its debt back or the US will pay its debt back as is the case with Japan or Italy.

It is all perception of value and ability to get your money back at the same relative value.
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