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Politics : Mainstream Politics and Economics -- Ignore unavailable to you. Want to Upgrade?

To: RMF who wrote (55068)10/10/2013 9:41:25 PM
From: TimF  Read Replies (1) | Respond to of 85487
 
Hey, you know not defaulting doesn't just involve making interest payments...

Yes you also have to roll over the principle. But doing so doesn't mean borrowing more. As for cash on hand, the income is enough if some of it is held for that purpose (rather than being spent as it normally would be).



To: RMF who wrote (55068)10/11/2013 10:26:37 AM
From: Brumar89  Read Replies (1) | Respond to of 85487
 
Oh come on, you don't know about rolling over bonds? As bonds mature and have to be paid, they simultaneously issue and sell new bonds, funding the redemption of the old ones. That doesn't increase the overall debt level.


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