One of the wildest ideas to hit the US Presidential campaign trail might become a reality sooner than you would think.
Donald Trump, the Republican party’s nominee, has claimed that the US national debt, standing at more than $19 trillion (£13 trillion), does not need to be repaid.
“This is the United States government, you never have to default, because you print the money,” he declared live on air.
His comments signal his belief that America’s authorities, could, if they wanted, print enough money to pay back their creditors without raising an extra cent in taxes.
To many, Trump’s comments were startling. Yet, those familiar with the gyrations of central banks know that they contained more than a grain of truth.
The notion of helicopter money – having a central bank issue new money to pay for government spending – could also be used to finance the US deficit, and eventually, to fund a budget surplus that could pay down the national debt.
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