How does inflation affect national debt

182 viewsEconomicsOther

If we have lower federal rates, that causes an inflation right?

Currently we have massive national debt. And we pay interest on that.

Why not try to maintain inflation just slightly above the interest rate of our debt, so that eventually our debt is irrelevant (the “buying power” of the 30ish trillion dollars would be reduced faster than the interest we pay on it).

In: Economics

11 Answers

Anonymous 0 Comments

Can’t believe no one here has mentioned the obvious.  The interest rate on US debt is tied to inflation.  If inflation goes up, so does the interest rate.  

You are viewing 1 out of 11 answers, click here to view all answers.