There have been literally hundreds of times when governments stop paying their debts (default) in the last 150 years. Since it is all over the news today (more on that later) take a look at the Wall Street Journal's view on it.
I feel like it is important that the government, the leading force of the nation, does what is right and just to set an example to its people and their communities. The fact that their are numerous instances where governments stopped paying their debts shows how it doesn't care about the well-being of their people, who are relying on them to make things better. I feel like being the government, they should take full responsibility and take action in helping their people live comfortable and peaceful lives.
JW- Even in the face of overwhelming evidence, there are those who will turn a blind eye. In modern times, such as many Americans, it is not even necessary to ignore facts; ignorance tends to prevail. However, it is still unsettling to draw the parallels through history repeated even though it is recorded. The article points out the European financial crisis and some of its sources including the lenient foreign loans within the union and then notes how foreign investment in Germany and non-sustainable borrowing led to defaults and a serious problems. How similar, indeed.
Neither blindness nor ignorance corrupts people and governments. They soon realize where the path they have taken is leading them. But there is an urge within them which they do not resist; it continues to push them forward as long as they have an abundance of strength. He who overcomes himself is hard to find. Most see their destruction before their eyes; but they go still do the wrong. -M. Misir Period 9
I agree whole-heartedly that history repeats itself. This isn't the only time that similar events had taken place that had already been seen in the history textbook. Debt is a big part of the economy, and it seems that the economists hadn't learned their lessons from back when the Allies had demanded a large reparation from Germany to pay off loans. Even today, as powerful as U.S. is, the large debt continues to haunt our economy. Debt will always be a part of an influential country's economy, as is stated by the author of the article, and will remain a problem in the future. -Raphael Kim
This article talks a lot about the economic problems that the world has today and throughout history. This is all caused because of the debts of each country. The article relates back to World War 1 and describes the conditions in which the treaty of Versailles had for the losers. In the treaty, Germany was forced to pay reparations. This was so the winning team could pay off their debt. But soon they realized that this wouldn't help in anyway. So, in 1924 Charles Dawes created the Dawes Plan. He even won the Nobel Peace Prize in 1925 for the plan he created. Thanks to his plan German payments were lowered. This was sort of a help for Germany. In today's world, the U.S and many other countries are going through the same same economic problems. Hopefully, a solution like the Dawes plan or an even better plan will be made soon! Maria U.
I feel like the concept of international loans doesn’t make any sense. This article gave the example of the reparations Germany had to pay after World War I, however, since they were so poor they had to borrow money in order to pay off their debt. So, the cycle ended up being Germany borrowing money from the U.S. which was then given the Italy which was then given back to the U.S. Therefore, nothing was really solved other than Germany drowning in debt. So really, the borrower of the loan ends up becoming even more in debt. And the country that the money is being borrowed from doesn't really benefit either (considering that the United States literally just circulated their money from Germany to Italy and back).
I find this article interesting for many reasons because it shows how the treaty of Versailles was a failure because most of the reparations were for Germany and personally I think that it's stupid because they know that the debt amount is unattainable. I think that the Dawes plan was a smart idea to some extent but still it was mostly only based on Germany. I think that everyone after WW1 didn't know what to do because they all had debt to each other which they obviously can't pay off so there is no need make others pay. One thing I don't understand is that everyone just sees the black and white but, they don't see they shades of gray and how it will affect their countries in the future. AM Prd.9
SK period 9: History repeats itself. At the end of WWI Germany was responsible for large reparations according to the Treaty of Versailles. Germany struggled to make payments because of their defeat and as as a result, things had to change. That's when the Dawes Plan helped out. The Dawes Plan reduced and restructured the payments. I think it was a smart idea when governments aid other governments, but I wonder about future economic issues. As the article stated, "future sovereign debt crises are inevitable."
Honestly, it took me some time to read and understand this article and I have a lot of questions to ask, such as-how do people buy foreign bonds and the debts of other-or their own-countries? What I do understand is that we have made a severe economic mistake in the past after World War I and the creation of the Treaty of Versailles, and that we cannot look back a couple of decades and correct the mistakes. I cannot understand how not even one country as a whole could recognize the repetition of the mistakes of the past and call them out so we do not repeat them once again. I also do not understand another thing. The U.S. loaned Germany money to pay Britain and France back, so Britain and France can pay us back. I understand the part where it is like a starting stimulation fund so Germany can invest it in itself and make more out of it so it can start paying back, but it did not work out like that. The money ended up falling down the drain. But after that said, currently many of the Eurozone nations such as Greece, Portugal and Spain are being submerged in debt and anchors such as Germany are throwing bailouts and bailouts as U.S. did to them after the war. In both cases, it has not and is not working, so why do they continue to aimlessly throw around money? Jugal
I think that government's system of promoting loans to foreign governments freely is not secured entirely, and in most cases ends up damaging the investors who purchased the bonds instead of benefiting them. As it should have been learned from the Dawes' Plan, where Germany's main central bank renegotiated the payment plan, the whole system ended up damaging investors and America's involvement to protect its financial situation with countries involved with Germany. I believe the system of government lending must be improved and reconfigured in order to protect and benefit investors with security.
I think that this whole idea of punishing Germany was greatly flawed, and it ultimately led to world war 2. Additionally, I don't understand how the american public could support the idea of loaning money to germany, so that they can payback britain and france, so that they can pay back america. The whole concept doesn't make sense. -Eshawn Sharma Per 9
I find that it is stupid that we can't exactly base decisions on what we know rather that just the simple way out. We know what happens afterward so if it's not favorable we shouldn't try to still pursue the same route to solving a problem.
Governments are always looking to gain power, and this sometime causes them to make decisions that may unstable the future economy and ruin stabilizing paths that were previously agreed to. Governments are made of people, and people will always behave like people, they have interests and desires, and that creates different economic positions. -Krish
I agree with the line that says "The history of government loans is really a history of government defaults." As we studied, along with details shown in the article regarding WW1, the entire debt that Germany, France, and Great Britain acquired was solely due to poor government decisions from waging war to creating a poorly constructed treaty, where the losers have no source of income to pay reparations. With debt plaguing societies, depression hits, decimating global markets and economies. This actual example can be traced back to the faulty government and I think that the current governments can learn from this to prevent another depression from occurring.
In reading about the tremendous debt that Europe had sank into after WWI, it amazes me how quickly plans can be formed. As each country had their own matters to attend to in addition to their debt and how it affected such a large portion of the world, it was smart that there was a universal system of being able to pay other countries as needed. However, this system failed because it relied completely on bonds, which doesn't actually contain the cash up front, and although it is ultimately an official piece of paper that says the possessor is entitled to the money, but it is not cold cash. This made it more of a problem when accounting for how much was actually paid, therefore making it a faulty system. -DS, Pd 9
I couldn't agree any more while reading this article. After learning about 10,000 years of history, it has become pretty much a guarantee that any nation or country that wants to do well will have debt. However, I never really thought about that or realized just how customary debt was until I read this article. I think this article was interesting to read and very eye-opening. - Michelle Lim
Chirag Soni WH10: This article is practically about how governments support other governments to loan. While on the other hand, loans have been hurting our foreign connection with other countries for many years. I feel that there is no way, for a country produce the amount of money some countries do, so another method of payment should be devised. Just waiting for the money, will never work because that country will need enough money to support its self and in the world to day there is barely a surplus. Though through the Dawes PLan, Germany had less to pay, life in Germany probably became harder because this amount of money is more wanted. We need to remember that we are all trying to create a world with a good life for its people, not harming them and that is what we do, when we put restrictions on countries to pay back their loans.
I agree with everything that this article has to say. It concept of these international loans is so strange. Just giving other governments loans is not really safe and definitely not a good idea! The article even states that because these governments are promoting government debt, "future sovereign debt crises are inevitable." Something that I was a little confused about was how people can buy foreign bonds of other countries.
History does repeat itself. Debt has been a problem for centuries, its what puts a nation in a tough situation where 1. they pay the debt probably hurting their economy or 2. borrowing from another country just putting them in more and more debt. International loans is just an endless cycle where money really is just a number that is never paid. when the article says that governments support loans it pretty much means they are using it as a way to put their debts off over and over again. -Kevin Johnson
Governments are confusing. That's what I got from this article. I don't understand why our government would give somebody that already owes us money, so that government could pay back another country that also owes us money. Like what? It really makes no sense to me. -KC pd9
I feel like it is important that the government, the leading force of the nation, does what is right and just to set an example to its people and their communities. The fact that their are numerous instances where governments stopped paying their debts shows how it doesn't care about the well-being of their people, who are relying on them to make things better. I feel like being the government, they should take full responsibility and take action in helping their people live comfortable and peaceful lives.
ReplyDeleteJW-
ReplyDeleteEven in the face of overwhelming evidence, there are those who will turn a blind eye. In modern times, such as many Americans, it is not even necessary to ignore facts; ignorance tends to prevail. However, it is still unsettling to draw the parallels through history repeated even though it is recorded. The article points out the European financial crisis and some of its sources including the lenient foreign loans within the union and then notes how foreign investment in Germany and non-sustainable borrowing led to defaults and a serious problems. How similar, indeed.
Neither blindness nor ignorance corrupts people and governments. They soon realize where the path they have taken is leading them. But there is an urge within them which they do not resist; it continues to push them forward as long as they have an abundance of strength. He who overcomes himself is hard to find. Most see their destruction before their eyes; but they go still do the wrong.
ReplyDelete-M. Misir Period 9
I agree whole-heartedly that history repeats itself. This isn't the only time that similar events had taken place that had already been seen in the history textbook. Debt is a big part of the economy, and it seems that the economists hadn't learned their lessons from back when the Allies had demanded a large reparation from Germany to pay off loans. Even today, as powerful as U.S. is, the large debt continues to haunt our economy. Debt will always be a part of an influential country's economy, as is stated by the author of the article, and will remain a problem in the future.
ReplyDelete-Raphael Kim
This article talks a lot about the economic problems that the world has today and throughout history. This is all caused because of the debts of each country. The article relates back to World War 1 and describes the conditions in which the treaty of Versailles had for the losers. In the treaty, Germany was forced to pay reparations. This was so the winning team could pay off their debt. But soon they realized that this wouldn't help in anyway. So, in 1924 Charles Dawes created the Dawes Plan. He even won the Nobel Peace Prize in 1925 for the plan he created. Thanks to his plan German payments were lowered. This was sort of a help for Germany. In today's world, the U.S and many other countries are going through the same same economic problems. Hopefully, a solution like the Dawes plan or an even better plan will be made soon!
ReplyDeleteMaria U.
Caitlin McTiernan pd 9
ReplyDeleteI feel like the concept of international loans doesn’t make any sense. This article gave the example of the reparations Germany had to pay after World War I, however, since they were so poor they had to borrow money in order to pay off their debt. So, the cycle ended up being Germany borrowing money from the U.S. which was then given the Italy which was then given back to the U.S. Therefore, nothing was really solved other than Germany drowning in debt. So really, the borrower of the loan ends up becoming even more in debt. And the country that the money is being borrowed from doesn't really benefit either (considering that the United States literally just circulated their money from Germany to Italy and back).
I find this article interesting for many reasons because it shows how the treaty of Versailles was a failure because most of the reparations were for Germany and personally I think that it's stupid because they know that the debt amount is unattainable. I think that the Dawes plan was a smart idea to some extent but still it was mostly only based on Germany. I think that everyone after WW1 didn't know what to do because they all had debt to each other which they obviously can't pay off so there is no need make others pay. One thing I don't understand is that everyone just sees the black and white but, they don't see they shades of gray and how it will affect their countries in the future.
ReplyDeleteAM Prd.9
SK period 9: History repeats itself. At the end of WWI Germany was responsible for large reparations according to the Treaty of Versailles. Germany struggled to make payments because of their defeat and as as a result, things had to change. That's when the Dawes Plan helped out. The Dawes Plan reduced and restructured the payments. I think it was a smart idea when governments aid other governments, but I wonder about future economic issues. As the article stated, "future sovereign debt crises are inevitable."
ReplyDeleteHonestly, it took me some time to read and understand this article and I have a lot of questions to ask, such as-how do people buy foreign bonds and the debts of other-or their own-countries? What I do understand is that we have made a severe economic mistake in the past after World War I and the creation of the Treaty of Versailles, and that we cannot look back a couple of decades and correct the mistakes. I cannot understand how not even one country as a whole could recognize the repetition of the mistakes of the past and call them out so we do not repeat them once again. I also do not understand another thing. The U.S. loaned Germany money to pay Britain and France back, so Britain and France can pay us back. I understand the part where it is like a starting stimulation fund so Germany can invest it in itself and make more out of it so it can start paying back, but it did not work out like that. The money ended up falling down the drain. But after that said, currently many of the Eurozone nations such as Greece, Portugal and Spain are being submerged in debt and anchors such as Germany are throwing bailouts and bailouts as U.S. did to them after the war. In both cases, it has not and is not working, so why do they continue to aimlessly throw around money?
ReplyDeleteJugal
I think that government's system of promoting loans to foreign governments freely is not secured entirely, and in most cases ends up damaging the investors who purchased the bonds instead of benefiting them. As it should have been learned from the Dawes' Plan, where Germany's main central bank renegotiated the payment plan, the whole system ended up damaging investors and America's involvement to protect its financial situation with countries involved with Germany. I believe the system of government lending must be improved and reconfigured in order to protect and benefit investors with security.
ReplyDeleteI think that this whole idea of punishing Germany was greatly flawed, and it ultimately led to world war 2. Additionally, I don't understand how the american public could support the idea of loaning money to germany, so that they can payback britain and france, so that they can pay back america. The whole concept doesn't make sense.
ReplyDelete-Eshawn Sharma Per 9
I find that it is stupid that we can't exactly base decisions on what we know rather that just the simple way out. We know what happens afterward so if it's not favorable we shouldn't try to still pursue the same route to solving a problem.
ReplyDeleteGovernments are always looking to gain power, and this sometime causes them to make decisions that may unstable the future economy and ruin stabilizing paths that were previously agreed to. Governments are made of people, and people will always behave like people, they have interests and desires, and that creates different economic positions.
ReplyDelete-Krish
Ansh Hirani pd. 9
ReplyDeleteI agree with the line that says "The history of government loans is really a history of government defaults." As we studied, along with details shown in the article regarding WW1, the entire debt that Germany, France, and Great Britain acquired was solely due to poor government decisions from waging war to creating a poorly constructed treaty, where the losers have no source of income to pay reparations. With debt plaguing societies, depression hits, decimating global markets and economies. This actual example can be traced back to the faulty government and I think that the current governments can learn from this to prevent another depression from occurring.
In reading about the tremendous debt that Europe had sank into after WWI, it amazes me how quickly plans can be formed. As each country had their own matters to attend to in addition to their debt and how it affected such a large portion of the world, it was smart that there was a universal system of being able to pay other countries as needed. However, this system failed because it relied completely on bonds, which doesn't actually contain the cash up front, and although it is ultimately an official piece of paper that says the possessor is entitled to the money, but it is not cold cash. This made it more of a problem when accounting for how much was actually paid, therefore making it a faulty system.
ReplyDelete-DS, Pd 9
I couldn't agree any more while reading this article. After learning about 10,000 years of history, it has become pretty much a guarantee that any nation or country that wants to do well will have debt. However, I never really thought about that or realized just how customary debt was until I read this article. I think this article was interesting to read and very eye-opening. - Michelle Lim
ReplyDeleteChirag Soni WH10: This article is practically about how governments support other governments to loan. While on the other hand, loans have been hurting our foreign connection with other countries for many years. I feel that there is no way, for a country produce the amount of money some countries do, so another method of payment should be devised. Just waiting for the money, will never work because that country will need enough money to support its self and in the world to day there is barely a surplus. Though through the Dawes PLan, Germany had less to pay, life in Germany probably became harder because this amount of money is more wanted. We need to remember that we are all trying to create a world with a good life for its people, not harming them and that is what we do, when we put restrictions on countries to pay back their loans.
ReplyDeleteI agree with everything that this article has to say. It concept of these international loans is so strange. Just giving other governments loans is not really safe and definitely not a good idea! The article even states that because these governments are promoting government debt, "future sovereign debt crises are inevitable." Something that I was a little confused about was how people can buy foreign bonds of other countries.
ReplyDeleteMonica Patel
History does repeat itself. Debt has been a problem for centuries, its what puts a nation in a tough situation where 1. they pay the debt probably hurting their economy or 2. borrowing from another country just putting them in more and more debt. International loans is just an endless cycle where money really is just a number that is never paid. when the article says that governments support loans it pretty much means they are using it as a way to put their debts off over
ReplyDeleteand over again.
-Kevin Johnson
Governments are confusing. That's what I got from this article. I don't understand why our government would give somebody that already owes us money, so that government could pay back another country that also owes us money. Like what? It really makes no sense to me.
ReplyDelete-KC pd9