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The government pays interest rate because it wants to look good internationally, otherwise it wouldn't even pay the "low interest rates". Explain to me how in the world the governments use trees to make money and a machine and then they have to borrow money. They can make as much money as they want and they would go and borrow money. This procedure is just crazy since the government has monopoly on all trees in their states. There is something more sinister to this method. Another thing is that the government can lend money tons of money to other third world countries, but is in debt itself. The government always find millions to invest in wars, but is in debt.
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∙ 15y ago
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Does congress have the power to borrow money?
Yes, Congress does have the power to borrow money that is taken on the credit of the U.S. This power is granted to Congress by the Constitution.
How does the government fund a budget deficit?
The U.S. Government finances a deficit by borrowing money from a couple different places. 1) U.S. Citizens and corporations in the form of bonds. 2) From themselves by borrowing money from other programs such as Social Security or Medicare 3) From other countries on the open market. Currently 30% of US debt is owned by other countries with China owning the most at about $850 billion. Remember all of this money eventually has to be paid back with interest.
What are principal and interest on a loan?
Principal is the amount you borrowed and interest is the money you give them as a 'gift' for letting you loan their money.
Is it legal to pay acredit card with another credit card I dont mean to transfer balance from one card to another what I mean is to pay a credit card with another by buying a gift crd to pay other.?
This can be done, but is usually done through the use of a "convenience check" that credit card companies send out in the mail. They work like cash advances on the credit card. The problem is if you are borrowing money to pay for money you borrowed, you are headed for disaster fast. You're robbing Peter to pay Paul, which will end in financial disaster for you, when Peter and Paul quit giving credit and want their money back. You'll probably borrow the money at a higher interest rate (cash advances are always the higher rate), to pay for the money that you borrowed at an already moderate to high interest rate. Don't dig a bigger hole than the one you might already be in. Cut them all up and then pay them off as quickly as possible.
What are the pros and cons of Speed Cameras?
I think speed cameras do nothing and the government should stop spending money on them but money on things that are actually necessary.
Is borrowed money taxable?
Money that is borrowed is not taxable. If you borrow it and don't pay it back, it can be classified as income and be subject to income tax. If you borrow money and are not being charged interest, the government will consider the cost of interest to be income that is taxed.
In order to distribute money does the government sell money to the banks?
No, the Government does not sell money to the banks. Instead they loan it to them at very low interest rates. The banks borrow money from the central bank a.k.a the government to use for their operations and repay the money along with the interest to them.
How does the Fed lower interest rates?
In reality, the Fed does not lower interest rates. It lowers the rate charged to banks to borrow money. This usually results in a lowering of commercial rates.
What do people pay to borrow money?
The loan is called the principal. People pay interest to borrow money, but payment is interest plus money toward the principal.
What is money a person pays to borrow money?
Interest.
Who decides how much money the government has to borrow?
Nobody decides how much money the government has to borrow. When the government wants to borrow money it has to issue or create debt with the US Treasury.
What are the advantages of a lower interest rate?
When you borrow money - either loan, overdraft, credit card etc..... - you will not be paying back as much interest. However, there is always a down side. You will not be getting as much interest on your savings. I say borrow a million, and blow the lot!!!!!
If I borrow money knowing it has interest - is it up to me to pay it and if I do not is that stealing?
If you borrow money on agreed terms, including the obligation to pay interest, then choose not to pay the interest, that would be stealing.
What kind of interest works against you if you borrow money?
compound interest
How does the Federal Government borrow money?
The federal government borrows money from issuing Treasury bonds. The bonds are bought by people, businesses and other government agencies. The bonds work by people lending money to the government who in turn pays back that money plus interest.
What is preferable a loan with lower interest present value or a loan with a lower periodic?
The lower interest rate is always preferred because interest is the amount you pay for borrowing money. In either case, you'll have to pay back the principle, so it amounts to a cost of money borrowed issue. By opting for a lower periodic payment, you are spending more to borrow the same money. Not the best option unless you are the lender.
Can states borrow money?
yes. states can borrow money from citizens through government bonds
