Archive for January 30th, 2009

Debt Reduction Plan

Friday, January 30th, 2009

 house paid off

pic by SMDOOM

The United States government goes on a debt reduction plan for Debt  of $10 Trillion dollars.

While the nation is experiencing a serious recession the government is in a great position.  It can now borrow at 0%-2.3% and charge 8%-13% for having preferred share invested in banks and financial type businesses under the bailout.  It can buy distress securities for a major discount and hold them until their worth a whole lot more.  It is charging a premium for guaranteeing debt which provides additional revenues to the federal government with no cash investment upfront.

There are no investors waiting for a return and we all known government can wait out the down turn.    I wonder with these three options how quickly the payoff will take to reduce the federal deficit and provide for for the payoff of Americas debt.