A recurring theme among economists all over the world is how countries should manage the debt of their settlers within the territory. A star within the discussions is the united States, with its issue of loans to college students. However, one of the presidential candidates seems to want to forgive the $ 1.6 trillion. To see this we ask ourselves how that would affect this event to Bitcoin.
Contents
Context
First of all, it is necessary a brief context about the situation with the united States, stressing that it will be a brief summary of the topic and may be incomplete. If you want us to do a more detailed article of the debt in the united States, they can leave it in the comments. In concise terms, to continue university studies in the united States is highly expensive in comparison of two variables. First, the average income of the residents of the country, second would be the rest of the world. This happens because they are constantly raising the prices of tuition in the universities. The reasons why happens this event are varied, however, the dominant indicates that there is a monopoly within the system, allowing to charge high prices. In addition, the mechanism of transition to prices is acquiring expense luxurious. An example posed is to change each year the mosaics of the pool for a few more expensive. Therefore, the average family of the united States turn a financing to be able to afford the high prices. Highlighting that these loans can be beyond the life of the person, that is to say, his or her heirs. This process has been going on for years, managing to accumulate in this way a student debts of $ 1.6 trillion. Highlighting that thanks to how the system works, the debt only grows, some would say that in addition to expands exponentially.
Bernie Sanders
Returning with the news of today, the presidential candidate of the united States on the part of the democrats, Bernie Sanders, announced that among its plans is to forgive the debt. Apparently, he wants the residents to feel free and not be hanged by the finance ill-managed of the country. The way by which you want to perform this plan is that the central government assume the full costs of the debt, by paying in this way to lending institutions. This implies that the U.s. debt would increase by the next fiscal.
Impact
Once known the situation, we can analyze that could happen with Bitcoin if Sanders manages to reach the presidency and to pay the student debts. In the short term there could be an increase in the demand of Bitcoin, since people could distribute their income in another way. In this way, it could cause a rise in the prices of Bitcoin. However, in the medium term would lead to a new problem for the pockets of the families, given that Bernie also has a plan to pay the deficit of the united States via taxes. That is to say, it would increase the tax burden on individuals and their real income would decline. The impact on Bitcoin is open-ended, as it could affect in a negative way or positive. Finally, in the long term would occur a vicious cycle, because the root of the problem has not been resolved, being the high costs of studying in the united States. In this way, it is highly likely to turn back to loans to be able to study. However, we want to know your opinion about this situation, given that it is a controversial subject among economists and the public. Do you think that the united States pay for the entire debt would be positive? The following two tabs change content below. I am a student of economics, interested in innovation and technological development, always faithful to that tomorrow will be a better day.