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State defaults in the United States are instances of states within the United States defaulting on their debt. The last instance of such a default took place during the Great Depression, in 1933, when the state of Arkansas defaulted on its highway bonds, which had long-lasting consequences for the state. [1]
The years from 1834 to 1837 leading up to the State defaults were inflationary until the Panic of 1837. Prices for cotton and other exports sent overseas were rising. Through trade and state-backed bonds, the United States had a strong inflow of capital from the Bank of England and other European parties. Large infrastructure investments were ...
If the individual citizen or corporate citizen is a creditor of the state (e.g. government bonds), then a default by the state can mean a devaluation of their monetary wealth. In addition, the following scenarios can occur in a debtor state from a sovereign default: a banking crisis, as banks have to make write downs on credits given to the state.
The bonds were tied up in a lot of real estate in the state and the carpetbagger government was looking for ways to fund infrastructure projects, many of which turned out to be phony ways to funnel money into their own pockets. The Arkansas legislature passed laws to refund the bonds on April 6, 1869 [4] with 30 years interest. Afterward they ...
"Without enough money to pay its bills, any of the payments are at risk, including all government spending, mandatory payments, interest on our debt and payments to U.S. bondholders.
It currently stands at $31.4 trillion. On Jan. 19, the U.S. hit its limit on how much money it can borrow. That forced the Treasury Department to initiate what it is calling "extraordinary ...
Danish state bankruptcy of 1813. [2] Kingdom of France: 1788: On 17 August 1788, the royal treasury began paying creditors in IOUs rather than money after service on debt (mainly from the Seven Years' War and American War of Independence) had depleted the royal treasury to just 400,000 livres (one day's worth of state
A money market fund (MMF) is a mutual fund that pools money from many investors to buy safe short-term investments like government bonds and high-quality corporate loans. Money market funds aim to ...