There’s a very popular story going around today that is intended to make it sound like the USA is running out of money. The article compares Apple Inc. to the US Federal Government. It says:
“According to the latest statement from the U.S. Treasury, the government had an operating cash balance Wednesday of $73.8 billion. That’s still a lot of money, but it’s less than what Steve Jobs has lying around.
Tech juggernaut Apple had a whopping $76.2 billion in cash and marketable securities at the end of June, according to its last earnings report. Unlike the U.S. government, which is scrambling to avoid defaulting on its debt, Apple takes in more money than it spends.”
It’s amazing to me that these sorts of comparisons trump common sense. The USA can never “run out” of dollars that it has the ability to print. Our debts are entirely denominated in a currency that we can produce at will. So, technically, the USA has infinitely more dollars than Apple Inc. could ever have.
Apple is a currency user. The US Federal government is a currency issuer. This is a very basic fact that Americans need to start understanding before they can elect politicians who won’t continue to drive this economy into the ground.