Day 151: On Debt

I’ve been listening to this podcast episode over the last couple of days. And I heard this brilliant sentence: “if you're holding debt of a highly indebted entity, you're likely to lose part of your money.”

And if that entity is a corporation: you're likely to lose your money nominally. I.e. If the company defaults, you will lose at least some (if not all) of your money. 

If that entity is a sovereignty (like a country):  you're likely NOT TO lose it nominally. Instead, you will lose your money in real terms. Meaning you will get your dollars back but they will be worth less (sometimes much less) than what you paid into that. I.e. via inflation.