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A very sobering analysis

Posted by Robbie53024 9 years, 4 months ago to Economics
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  • Posted by png 9 years, 4 months ago
    Oh, please. This doesn't even survive the most cursory analysis. The US national debt was a much larger fraction of GDP during World War II. http://en.wikipedia.org/wiki/National_de... As you can see from the article, the debt is currently about 74% of GDP. That's an awful lot of money, sure, but compare that figure with your own real-world experience. Imagine a plumber who makes $40,000 per year and owes $30,000 on a mortgage. Who would call that a problem, never mind unrecoverable? Don't focus on the amount of the debt, focus on the nature of the debt. Focus on the fact that this debt was imposed on us without our knowledge and consent, and that whatever the amount of the debt, it can only be repaid by taking the proceeds of our productive efforts away from us at gunpoint. That's what matters here.
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    • Posted by $ jbrenner 9 years, 4 months ago
      Your data regarding the national debt is very outdated, png. The debt is now > 100% of GDP. Moreover, back during WW2, we didn't have nearly the off-books promises of payment for Social Security, Medicare, Obamacare, etc. that we do now. We now have well over $100 trillion in promises to pay - over $300,000 per individual. For productive individuals like us, we are expected to "contribute" more like 2 million dollars, which is close enough to what many of us will make in our lifetimes that we are effectively slaves to the state.

      The better analogy for your $40,000 per year plumber is having about $200,000 on a mortgage - when you include the off-books promises to pay.
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      • Posted by $ jbrenner 9 years, 4 months ago
        Moreover, in your analogy, you are assuming that all citizens are producing at the rate that your plumber is. They are not. The number of people employed right now is close to the same as those who are not.
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      • -3
        Posted by png 9 years, 4 months ago
        It isn't "my data", it's the real data. I gave a source, which ultimately goes back the US Treasury. You're welcome to attack the credibility of the US Treasury if you like, but leave me out of it. Also, it's completely ridiculous to throw in all the budgeted future payments for Social Security and so on without also counting the budgeted future revenue that will pay for those things. In other words, you're just making stuff up, and even AFTER you do that, you still end up with hypothetical numbers that don't represent a particularly bad financial situation. Stop wasting our time.
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        • Posted by 9 years, 4 months ago
          Problem with future payments is that there are increasingly fewer paying in. It soon will be down to 3 paying in for every 1 taking out, then 2 to 1 and finally 1 to 1, and eventually less than 1 to 1 at which point it will fully collapse.
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          • -4
            Posted by png 9 years, 4 months ago
            Now you're just making stuff up, too. Why do people feel the need to support irrational arguments with outright lies? It doesn't help. Please stop.
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            • Posted by $ jbrenner 9 years, 4 months ago
              When you start dealing with hospitals and nursing homes like I am, and then see the very large sums of money that are being "paid by Medicare", you will soon understand what I mean. It is not hard to rack up medical bills at a rate of $20,000 per month.
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            • Posted by $ Mimi 9 years, 4 months ago
              The current system is unsustainable because a majority of the population within the next twenty years will be the over-65 crowd. That is a fact.
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              • Posted by 9 years, 4 months ago
                Well, it won't be a majority, but it will be the largest percentage the nation has ever seen, due to medical advances and the boom in births after WWII. There is a slight decrease as the BBers finally all expire, but then the amount increases again to a roughly steady state.

                The upshot being that we never had this level of retirees before, but will have essentially forever. Thus a system where current inflows paid for current outflows is unsustainable without drastic increases in taxes or decreases in benefits.
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              • Posted by png 9 years, 4 months ago
                That's a clumsy lie. Can you cite a source that agrees with you? ... I didn't think so. Here's one that doesn't. http://www.smithsonianmag.com/40th-anniv... "The portion of the population that is currently at least 65 years old—13 percent—is expected to reach about 20 percent by 2050." First Google hit.
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                • Posted by $ Mimi 9 years, 4 months ago
                  The aging of population is worldwide.
                  http://ije.oxfordjournals.org/content/31...
                  The 65-over group will be somewhere in the neighborhood of 20% percent of our population. But how many age groups made up the 100%? Five or six? Do you know?
                  The 65-over group will always have an advantage in statistics because it covers several decades, while the other groups tend to be counted in ten-to-fifteen year increments.
                  I think I saw one article recently that actually make a separate group of the 85-older, but still...that doesn’t happen often.
                  So tell me: What age group has a bigger than 20% pool? Hmmm?
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            • Posted by 9 years, 4 months ago
              According to the SSA (yes, I know, it's gov't data), in 2010 we were down to 2.9 paying in to every 1 receiving benefits. With the significant decrease in the working population and the baby boom bubble continuing to march towards retirement, that has had to have moved further downwards.

              Even if a significant number of illegals are allowed to enter the payee ranks into SS, they will do so at a much lower level than those being replaced. This cannot make up the difference and the outflow will continue to increase faster than the income.
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        • Posted by xthinker88 9 years, 4 months ago
          It's a stupid analogy. The plumber gets paid his $40,000. The government does not get paid the GDP. Measuring debt against the GDP makes no sense at all except as spin to try to make people believe things are ok.

          Estimates are that the US government will collect $1.6 trillion in tax revenue in 2014 (although that includes social security tax). Against that, the US Federal debt is $18 trillion as of November not including unfunded future liabilities. So if we use your plumber analogy, the $40,000 a year plumber now has $450,000 in debt not counting unfunded liabilities.

          What bank would give the plumber more money?
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        • Posted by $ jbrenner 9 years, 4 months ago
          The "real data" that you quoted from the Wikipedia source is several years outdated. No, I didn't make anything up. The budgeted future payments for Social Security and Medicare do not decrease the amount of money that would need to be paid in to meet the gargantuan expectations of what we are expected to pay. Those future payments are merely the amount that the politicians expect us to pay. The remainder of those future debts will be simply printed from out of thin air to allow the government to devalue the dollars that savers like us already have.

          To further this analogy question, if I had approximately a $300,000 mortgage and the bank expected me to pay $200,000 of it, then either a) the bank would foreclose on me, b) the bank would not make the loan in the first place, c) the bank would ask the Federal Reserve to print the money of thin air (which is what they do for the federal government), or d) they would ask the federal government for a bailout as they did in 2008. Any business that used US Treasury accounting practices would wind up like Arthur Andersen and Enron did. More of the spending is off budget than on budget. Just curious, did you play Monopoly with a kitty under "Free Parking" or not?
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          • Posted by 9 years, 4 months ago
            Plus, there are no "reserves" in the SS trust fund, merely IOU's from the general fund to the SS fund. There is no reserve, it was all spent. To redeem those IOU's the SSA will be looking for the US Treasury to repay the bonds being held. That will call for more money from the US budget, money that either comes from more taxes or more loans.
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            • Posted by $ jbrenner 9 years, 4 months ago
              The difference between the 100+% debt/GDP ratio and the 74% debt/GDP ratio quoted by png is mostly such IOU's from the Social Security trust fund, with some Medicare thrown in, as well as a few other smaller items.
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              • Posted by 9 years, 4 months ago
                And those are not "intra-gov't" loans, they are loans held in trust to those future SS recipients. The fact that they are held by the SSA does not negate the fact that they are real obligations owed to real people.
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          • Posted by png 9 years, 4 months ago
            The data are absolutely current! Read the article. Go to the source page at the US Treasury. Stop making stuff up.
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            • Posted by $ jbrenner 9 years, 4 months ago
              You are choosing to believe that intragovernmental debt is not real debt. If I owe money to my wife, you could argue that that is not "real debt" because it is within my family. However, if one part of government were to pay off another part of government (which will likely never happen), then where would that part of government get that money. It would either tax us, or it would create that money out of thin air. The latter is the current approach by the Federal Reserve. Such fiat currency manipulation is a hidden tax on anyone who saves in the form of inflation. Over the last several years, several trillion dollars has been made up out of thin air. I simply reject your premise that intragovernmental debt is not real debt. It is an accounting gimmick that any company or any person would not be able to get away with.
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              • -3
                Posted by png 9 years, 4 months ago
                Your logic makes no sense. If you owe money to your wife, it doesn't contribute to your family's indebtedness. Why do you work so hard to come up with these ludicrous arguments? Just accept facts, for crying out loud. If you have some argument that reflects the facts, make it. Otherwise you're just making noise.
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                • Posted by 9 years, 4 months ago
                  Your concepts of economics and accounting are woefully inept. Please refrain from commenting on things that you cannot present a rational and reasoned argument.
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            • Posted by $ jbrenner 9 years, 4 months ago
              Current GDP is $17.4 trillion for 2014:

              http://www.statista.com/statistics/26359...

              The official national debt is over $18 trillion.

              http://www.usadebtclock.com/

              That is over 100% of GDP, not the 74% you quoted.

              Moreover, this debt presumes an unsustainable interest rate. How long do you think seniors will accept the paltry return on investment that they are getting when they were told by their financial advisors that they were going to get 5 or 6% on their CD's?
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              • Posted by $ jbrenner 9 years, 4 months ago
                Using the web site
                http://www.usadebtclock
                you can see that the "average household" has an unfunded liability of just a shade under a million dollars. Virtually all of us here in the Gulch make substantially more than the average household. I am quite sure that the government considers $2 million my household's "fair share".
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              • -2
                Posted by png 9 years, 4 months ago
                Do you even understand that $18 trillion figure? That includes money the government owes to itself-- what they call the "intragovernmental debt." If someone in your family owed $20 to another family member, would that be part of your family's overall indebtedness? Of course not. Seriously, try reading BEFORE writing, it works out better for everyone.
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                • Posted by 9 years, 4 months ago
                  You should try thinking before writing.
                  Simple scenario: US Gov't takes in $100 in income taxes and $20 in SS payroll taxes. The gov't spends $130 using the income tax money, sells $20 in bonds to the SSA, and sells $10 in bonds on the open market. How much debt is owed? Well, you seem to say that since the $20 is intergov't debt, that it shouldn't count. But at some point in the future, that $20 bond is going to be redeemed and will have to be repaid. Where's it going to come from? The general fund in the form of more taxes or more borrowing. But it has to be paid, because the original funds were already spent.
                  Really, think about things first. Your arguments/analysis is faulty.
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                • Posted by $ jbrenner 9 years, 4 months ago
                  Yes, I understand intergovernmental debt and intragovernmental debt. The government is using an accounting gimmick that my company would never be able to get away with.
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                  • -1
                    Posted by png 9 years, 4 months ago
                    Large businesses often shift money around from one departmental account to another WITHOUT making any attempt to pay it back later, which means that tracking intragovernmental debt is actually more fiscally responsible than companies are required to be.
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                    • Posted by 9 years, 4 months ago
                      Now you're making foolish analogies. If a company moves money around internally, that has no material impact on the overall finances of the business. If the company had a subsidiary, and borrowed money from it, and spent that money, they damned better report that as a liability or they'll go to jail. And if that is not repayed based on the terms of the loan, intra-organization or not, they will go to jail.
                      You are the one out of your depth, here. Stop digging your hole deeper.
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                      • Posted by png 9 years, 4 months ago
                        Why can't you accept the facts? Intragovernmental loans come from previous revenue-- trust funds running a surplus. There's been no borrowing from outside the government, unlike the other Treasury instruments that make up the real debt.

                        You people are so disappointing. I noticed when I worked to support the Ron Paul campaign in 2008 that most of the people around me were 9/11 Truthers-- ironically, of course, people utterly resistant to truth in any form because fantasies of vast conspiracies were so much more comforting to them.

                        This was a total reversal from Dr. Paul's campaign in 1988, which I also worked for, having the privilege of spending a day with Dr. Paul and hosting Andre Marrou at my home. By and large, their supporters were the very best of the Libertarian Party, the nut jobs having been mostly distracted by Russell Means. But now the LP, like much of the Objectivist movement, has become an asylum run by the inmates. No wonder Dr. Paul went back to the Republican Party-- people like you drove him back there.

                        There's a similar but even greater irony here, which is that a forum named after Galt's Gulch is dominated by people like you who have no interest in facts, only a fanatical devotion to their own comforting fantasies. Do you remember what John Galt said about Galt's Gulch?

                        "Nobody stays here by faking reality in any manner whatever.”

                        You don't belong here. This place should belong to those who accept the facts, think rationally, and speak the truth. People like me.

                        Get the hell out of our way.
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                        • Posted by 9 years, 4 months ago
                          Peter: You seem to be the one who cannot accept facts. The money that was gathered by the SS system was paid out in benefits or "loaned" to the fed gov't. Those excess funds were not meant for the general fund, they were meant for the SS system. Bonds are not money, they are promises to repay money. That money must be repaid. It is a debt, and the bonds are only worth what one expects to get for them. Up to this point, that was pretty secure. Now, the probability of repayment is decreasing daily. That repayment looks to be only possible via higher taxes or additional borrowing. Taxes are unpalatable and borrowing merely kicks the can further down the road.
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    • Posted by Zenphamy 9 years, 4 months ago
      png; Your last two sentences strike to the core of the life we have today and as you say, 'what matters'. But I differ on the focus of the nature of debt vs. the amount of debt. That strikes me as playing the leverage game based on the Fed's 2% inflation and 2% GDP growth and the ability to continue to roll over the principal of the debt with continuing debt service with inflated money and increased revenue from the GDP growth stretching out to infinity. Yeah, the government manages to keep it's books looking like they make sense, but what happens to the citizens earnings, wealth, and value of 40 years of work.

      I've witnessed a lot of businesses trying to play the debt game but ignoring the cash flow requirements and the available market, lose their asses along with a lot of their investors. You simply cannot continue a debt based system into infinity. The full faith and credit of the government based on promises against the productivity and buying power of your citizens, then their children, then grand-children--somewhere the teetering ball at the top of the pyramid falls.

      In simpler terms, its the old adage of 'Robbing Peter to pay Paul' that I was taught as a child and we're Peter.
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    • Posted by $ jbrenner 9 years, 4 months ago
      You are correct in one respect. The US national debt was a higher fraction of GDP during WW2. However, after WW2 was over, the federal yearly budget as a fraction of GDP was FAR lower. Moreover, the expectation was that Americans paid off their debts. That is no longer the case. Creditworthiness is no longer evaluated on someone's ability and likelihood of repayment. It is now based on how much debt you are willing to tolerate.
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    • Posted by xthinker88 9 years, 4 months ago
      It's a stupid analogy. The plumber gets paid his $40,000. The government does not get paid the GDP. Measuring debt against the GDP makes no sense at all except as spin to try to make people believe things are ok.

      Estimates are that the US government will collect $1.6 trillion in tax revenue in 2014 (although that includes social security tax). Against that, the US Federal debt is $18 trillion as of November not including unfunded future liabilities. So if we use your plumber analogy, the $40,000 a year plumber now has $450,000 in debt not counting unfunded liabilities.

      What bank would give the plumber more money?
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    • Posted by plusaf 9 years, 4 months ago
      Great... in 1979 I had a gross income of about $24k and a mortgage of about $70k. At 9.89% or so.

      What mattered was that, with all other expenses covered, I could handle the carrying costs of the mortgage... I could (just barely) pay the monthly payments of principal AND interest without sucking down savings.

      It's the INTEREST costs that are important, not the principal amount!

      After years of inflation (and wife getting a job!) the monthly mortgage payments fell to noise levels and I ended up prepaying, refinancing at lower interest rates and eventually paying the mortgage off!

      If y'all would stop thinking in terms of income and total debt, this discussion might make sense.

      Today, if real interest rates are under 1% (the rate at which the government can borrow money or the interest rate ON the Debt... 'we' can go on paying the interest on the Debt forever.

      It's not like anyone is going to call in the mortgage next month or next year and we've got to come up with the Payoff Balance!

      Though CNBC or CNN might like you to look at it that way... Fear, Uncertainty and Doubt-Arama!
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      • Posted by 9 years, 4 months ago
        Some good points, but in fact, the "mortgage" is being called in - in the form of the bonds being held by the SSA that need to be repaid to pay the retirement for the BabyBoomers. This money was foolishly spent by the politicians when it was being taken in. Now, when it needs to be available to pay out, it isn't. So, not only are the interest rates important, but the principal is critical as well.

        The situation with the SSA is more akin to having an interest only mortgage. You paid the interest monthly, but now you're coming close to needing to pay off the principal, and you haven't grown your income sufficiently to do so.
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        • Posted by plusaf 9 years, 4 months ago
          No argument from me on that, Robbie... but all I'm trying to point out is that the situation you've accurately described is the result of nearly a hundred years of failure to adjust the rules and deductions and contributions leading to the future debacle.

          What I'm trying to say is that if it takes 100 years to really screw up a system, maybe 'plans to change course' shouldn't include expectations to Fix Everything in our next Five Year Plan... if there even were one.

          I have proposed and supported plans to make SocSec voluntary and opt-in OR opt-out, with clearly-defined terminology and rules and obligations on the part of all workers who sign up or out.

          That's why I referred to a roughly '40-year working life' as what I considered a 'reasonable' amount of time for most humans to adjust their savings, spending and retirement planning to achieve a safer and more secure retirement life for themselves and their families.

          As for 'calling in the debt,' I think we all can expect that the 'solution' that will come out of DC will be some kind of kicking-the-can-further-down-the-road, coupled with pulling the wool over as many eyes as possible so that 'harsh realities' don't have to be experienced by Anyone, Ever. Including Congressmonkeys....
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    • Posted by 9 years, 4 months ago
      As jbrenner states, your scenario is too simplistic. Our debt is more than 100% of GDP and increasing yearly (even if the politicians try to make hay out of not rising as much as it did last year). So your analogy would be more correct if it was a $40k plumber with a $100k mortgage and putting an additional $10k on credit cards every year. That plumber will never get out of debt.
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      • Posted by plusaf 9 years, 4 months ago
        But your example is a straw man. It assumes that the plumber will never find a way to live within his means and will, forever increase his credit card load.

        As I said before, I was a "$24-27k marketing guy with a $70k mortgage"! My wife and I DID have a negative cash flow of about $1000 a month for nearly a year until she found a well-paying job.
        Inflation obviously helped decrease the impact of our mortgage payment (something like $610 a month... I just unearthed some old tax records to shred...) but about 15 years later, we'd paid the entire mortgage off!

        To paint the picture that an alternative scenario is impossible or that everyone in the 'plumber's position' will be there forever is what I call 'the catastrophization of America.' All problems will destroy everyone all the time and no solution is feasible without everyone getting screwed one way or the other.

        If I want that kind of rhetoric, I can turn to leftish TV 'news' broadcasts or virtually anything that escapes Obama's mouth.

        Sorry...
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        • Posted by 9 years, 4 months ago
          Please show me any willingness by those that control such things to reduce expenditures below tax inflows so as to pay off the debt. The only time this has happened recently was during the '90's, and that was due to the BB generation reaching peak productivity and peak spending which caused taxes coming in to grow dramatically (the spending reductions helped, but it was mostly increased inflows). That will not happen again. And in fact, the influx of illegals will pay in a relatively small amount and draw out substantially more than ever paid in. That action is accelerating the collapse.
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          • Posted by plusaf 9 years, 4 months ago
            Hey, I NEVER claimed that there was any "willingness" to reverse the trend! The Liberals see tax revenues as a bottomless well to pay for anything they think is worth paying for AND so do the Conservatives.

            The Liberals tend to want to spend the money on 'social support and infrastructure' whether any of the programs have ever demonstrated success in reaching their alleged goals, AND the Conservatives love to take that money and funnel it into National Security issues... like military programs... whether the Pentagon even wants the program or not.

            Oh, and as a current footnote on debt versus income, my wife and I currently carry a debt load of about $75k and ALL of our 'income' is from SocSec and IRA withdrawals.

            In ten and a half years, our TOTAL IRA balances are down about 2/3 of one percent, after hundreds of thousands of dollars of fees and withdrawals. Our SocSec 'income' would cover maybe half of our outstanding debt (which comprises a Home Equity Loan and our Visa account (which is paid off in full every month from our checking account.))

            It's not the Debt... it's the debt LOAD on your cash flow that matters!

            Keep in mind, too, that the Boomer Generation (which began just after I was born) grew up into the instant-gratification and "pay"-with-plastic credit card mentality, and severely hyperextended itself in every way possible. The Boomers supported the 'government will supply all of our needs' belief and didn't save bupkis towards their own retirements.

            Reality bites.
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            • Posted by 9 years, 4 months ago
              The debt matters when it comes due.
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              • Posted by plusaf 9 years, 4 months ago
                Robbie, that's another fiction, too... Some debts have fixed 'payoff dates,' but I don't think there is one set for 'the National Debt', is there? Link, please?

                Even a home mortgage with a paydown schedule has only a 'last payment date' not a 'callable expiration.'

                As my friends at MarketMinder.com keep saying, neither China nor anyone else is going to 'cash out of US bonds'... it makes no sense for them to do so and it would hurt them as much or more than it would hurt 'us.'

                Or, more simply, "What's the 'Due Date' on our National Debt?" Link, please? :)
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                • Posted by 9 years, 4 months ago
                  What I'm referring to is the Social Security payments and Medicare. The Baby Boom generation has started retiring and will be doing so in ever increasing numbers for another 2 decades. Payments into each system were used to pay for current obligations with the remainder being spent by the general fund. Those bonds will need to be paid back to take care of the ever increasing cohort of elderly. There will not be sufficient current inflows to cover the outflow. Paying back that debt will become an increasingly larger part of the annual budget and will either result in higher taxes (stifling growth), lower benefits (resulting in ballot box retaliation), or increased borrowing (kicking the can further down the road - but at some point, nobody is going to want those bonds as they will be unredeemable, and may already be there since the Fed is the largest purchaser of bonds).
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                  • Posted by plusaf 9 years, 4 months ago
                    Yes, exactly! And while most of us here are talking about The Problems, few have put forth any possible solutions. And the name-calling and ad hominums are really starting to piss me off, too.

                    I thought we Gulchers dealt with facts, not insults?
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  • Posted by $ CBJ 9 years, 4 months ago
    I was reading the same "point of no return" stuff 20 years ago. Nobody actually knows when (or if) an economic point of no return will be crossed. So far, improvements in technology appear to be keeping prices down in spite of the rapid expansion of the money supply. And serious investors (or countries) buying or selling U.S. Treasury debt are certainly aware of the possibility of a rapidly depreciating currency, and have adjusted their risk profiles and expectations accordingly.
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  • Posted by freedomforall 9 years, 4 months ago
    How much is debt that was issued to investors vs how much is debt only created to "save" the banks? How much exists only on the balance sheet of the fed (created as an electronic entry only)?
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  • Posted by johnpe1 9 years, 4 months ago
    they don't have to engineer inflation -- it "engineers"
    itself. . the feds say that inflation is zip, right now.
    but go buy some groceries. -- j

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  • Posted by Zenphamy 9 years, 4 months ago
    Makes sense to me. The US economy measured as GDP is roughly $16 trillion per year , current debt is $18 trillion (which doesn't include off the books or entitlement debts), current spending is near $1 trillion deficit, current legal immigration is 1 million per year, current illegal immigration is god knows per year. Inflation of 2% per year against GDP growth of 2% per year doesn't cut it. None of it cuts it. There is no logical mathematical algorithm that gets from here to there.

    I kind of think that's been the whole idea from the start.
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  • Posted by wiggys 9 years, 4 months ago
    it finally opened for me. one thing that is not recognized is that when each generation appears to accept what ever is already in place. they don't know any different, so they accpt the situation. some with education may very well see that some of what has been going on is not good, but then they have to educate those around them. that is a problem. as time has gone by the government take overs become just accepted and the education needed to change things gets more and more difficult for two reasons, increase in population and a dumbed down population. the latter wouldn't understand anyway and the people who are working in the welfare system commonly called the government like it that way. nothing is going to change for the better at all and in my opinion all will get worse.
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  • Posted by mckenziecalhoun 9 years, 4 months ago
    Did he add in the debt owed to us?
    I find it interesting they always leave that off and as a result in any comparison of nations we're never shown as a debtor nation.

    Added together, we come out in the black.
    There are problems with relying on that, however.
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    • Posted by $ jbrenner 9 years, 4 months ago
      Check your premises. These countries have no more intention of repaying us than the government has intention of paying off its debt. Moreover, our country has no intention of collecting such debt either.
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    • Posted by wiggys 9 years, 4 months ago
      what is owed to us can not be paid to us by the countries that owe it to us because they do not have it. also they do not have a federal reserve company that can create the money from thin air as the federal reserve located in the USA can. so we will not be paid back and there is no way that we will ever try.
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    • Posted by $ jdg 9 years, 4 months ago
      No, the total still leaves the US as the biggest debtor nation.

      Read the works of Davidson and Rees-Mogg, especially "Blood In The Streets".

      I don't refer to it as "our" debt, though. I didn't authorize any of it. Nor, I suspect did you.
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      • Posted by mckenziecalhoun 9 years, 4 months ago
        Sorry jdg - I've seen the stats.
        Just not true.
        We're no where near the largest debtor nation.
        Greece is and many lead the way between us and them.
        There is no chart or list showing our total lending and debt that shows us anywhere near the bottom and I challenge you to show it.
        Doesn't exist.
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        • Posted by plusaf 9 years, 4 months ago
          And I believe what you're also implying is that folks who bitch about the huge US debt tend to ignore which country or countries have the largest GDP, too! Even looking at it on a per capita basis can make the list change a lot, too.
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    • Posted by $ jlc 9 years, 4 months ago
      Would you please elaborate, or point me toward a source that does? I had missed the fact that there are vast unmentioned debts owed us.

      Jan
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      • Posted by mckenziecalhoun 9 years, 4 months ago
        Just look for debts owed the USA - we loan money out to a variety of nations.
        It's a web of debts and debtors - it's not just debtors on one side and lenders on the other.
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        • Posted by 9 years, 4 months ago
          Again, from an accounting standpoint, those are assets, not debits. Only when they are defaulted on do they become liabilities. Might not be right, but that's the way it works.
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    • Posted by 9 years, 4 months ago
      Are you talking about entitlements like Social Security, Medicare, etc.?
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      • Posted by mckenziecalhoun 9 years, 4 months ago
        No.
        We borrow money from other nations for specific and general purposes.

        They do the same. Added together, the USA has NEVER been shown as a debtor nation.

        I'm using the following definition:
        DEFINITION of 'Debtor Nation'

        A nation with a cumulative balance of payments deficit. A debtor nation has negative net investment after recording all of the financial transactions it has completed worldwide.

        They always list the debt - but never list the debt owed us. I find that interesting.
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