In a July 25th video which went mildly viral in libertarian circles, Ron Paul (R-TX) declared that a United States default is inevitable given the nation's level of indebtedness. At this point in the dog days of summer, the Congressman's assertion can hardly be dismissed as hyperbole. Yet, his definition of default is a curious one. The financial definition of default is when a debtor is unable or unwilling to fully comply with a borrowing agreement, such as missing a payment or seeking to restructure the payment schedule. Paul stretches that definition to include default by inflation. In this scenario, a nation "defaults" by reducing the value of its fiat currency, which diminishes the debt. Five thousand dollars of credit card debt seems significant, unless the average household income is fifty thousand dollars a month and a loaf of bread costs eight hundred dollars. Most American Conservatives, the author included, are hesitant to enthusiastically support ...(Read Full Post)