$15 Trillion in 5 Days

Do you have enough cash to pay all of your debts off immediately? What percent of Americans do? Not very many. This is why you are in debt, you do not have the cash.

I simply do not see how this is pertinent. The US has been in debt for about 150 years or more now. Why do you think that suddenly the Fed should have to pay it off? I cannot name one western country except maybe Norway that the government has the liquid cash to pay its debts off today.

The sad truth is that the Fed does need to pay its debts off, it has your house, my house, and the entire US asset base backing it up.

Chris

 

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All the money spent in the USA through the Colonial period, the Revolutionary War, Civil War, the expansion to the West, WWI, WWII, the Moon Landings..., did not equal 1 Trillion dollars until 1973. Now they are spending this amount of money every few months. They can't pay it and the USA has moved into unprecedented and uncharted terms in it's economy.

Watch out when just the interest on the debt exceeds the country's ability to pay it.

 

98% of all the national debt has been run up since 1971. Just 40 years. It was expanded by 50% in just the last decade. The rate of growth is increasing.

 

They Feds made what 29 million in 4 hrs from us minus what production and cost of the silver! Give us a Denver mint mark Silver Eagle! Limit 100,000 and 1 per household at $100 per coin! Its not 15 trillion but every lil bit helps right! I'd buy, wishful thinkin

 

In nominal terms, but the amount of debt generated during WWII is staggering when put in todays values. As a percent of GDP the deficit being run today is bad, but not great multiples of previous periods. Listen, I hate it too, and if I had the power to would only vote for politicians who would promise to veto every single spending bill because its way too much money.

Just my opinion.

Chris

 

Not an equivalent situation. Debt in WWII was backed by real hard assets (gold & silver) and commitments by allies to pay it back. The United Kingdom, for example, finished paying back this debt in 2006. Ever wonder why 60% of Germany's gold is sitting in the basement of the Federal Reserve?

 

The nominal amount of debt is meaningless in historical comparisons, what's actually useful is percentage of GDP.

 

If the government spends $1,000,000 to buy toilet paper for the bathrooms in the congress with the money it borrowed, did the production of that toilet paper get added to the GDP? In other words, it's pretty much a meaningless measure.

 

Sorry, that's the only right way to compare historical debt measurements. The highest debt-gdp ratio was during WWII, where it reached 120% of GDP. But the GROSS nominal amount was less than 225 billion. You really think the debt situation then, with only $225 billion was better than before GW Bush took office, with a GDP ratio of 57% but a GROSS nominal amount of $10 trillion?

I don't even understand the point of the original post, much less this ponzi blather. No sense.

 

Yeah, during WWII they did push war bonds to help pay for it. I don't know how much they helped but it gave the people the feeling that we were paying for as much as we could. Since then, all the wars have gone on the credit card.

 

I would like to see a side by side comparison of US total debt/GDP from 1945 and now. US total debt (Federal, state, local, personal) is now 363% of GDP. It has increased in 11 years from 276% of GDP.

Here's what google returns:
http://www.dailymarkets.com/economy...io-is-now-worse-than-in-the-great-depression/

Yeah, it's worse than the Great Depression or World War II. What this means is everyone is going to want to raise taxes. The Federal Government, the states, the cities. Where does all the money come from? If the debt is too big it can't be paid. It will be defaulted, restructured, or inflated.

The only good thing for the US right now is our debt is deemed safer than that of most other countries, especially the PIIGS.

 

Debt accumulated from interest in October was $200 billion, which means we'd have to come up with that much just to keep from getting further into debt. This is the problem with usury and compounding interest (interest charged on debt accumulated by interest instead of only on the original loan). GDP can never grow exponentially as such a debt does, and the budget cuts being discussed over the next 10 years will only address 1 year of interest alone. The amount of budget cuts and taxes for the debt to be paid back in traditional terms would be so extreme at this point that nobody will propose it; it would almost ensure they don't get any votes because most folks won't want to tighten their belts (which are already tight) after decades of living beyond our means thanks to the benefits that having the world reserve currency brings (such as exporting inflation).

US debt may currently be safer than the EU area, but counter party risk will impact banks here just as well as over there so it's only a transitory sentiment. Precious metals are the only money without counter party risk, and must return to their former role in order for the debt situation to be rectified.

 

Jefferson County (Birmingham, Ala) just voted to default on the outrageous amount of money it borrowed to finance its sewer system. So far it's the largest municipal default in USA history. More to follow, once the states and municipalities realize that defaulting on debt to the banksters has no effective repercussions.

 

They keep saying they have to stop it but they never do! They are too busy with their PR crap and party vs. party shenanigans to do anything useful.

 

But if you read more on this story, the corruption surrounding the borrowings were so bad that many public employees went to jail, they accepted bribes to sign loans that were way too risky for municipal borrowing. The county entered into Chapter 9 mainly as a negotiation tactic.

In this instance I believe they were right to do so, but most municipal borrowing does not have the same situation. In fact, most municipal borrowing in issuing bonds that many individuals, pension plans, and small businesses own. Most local governments are in trouble because of entitlements and Personnel and Benefits costs to their employees.

 

http://www.usgovernmentdebt.us/spending_chart_1940_2016USp_13s1li111mcn_H0f

Gross federal debt-to-GDP is around 100%. Net deb-to-GDP is less of course. If you add in total personal debts, then it's kind of a different comparison with different meanings.

 

Of course it's different. My point is, controlling the debt this time is going to be a lot harder than during World War II, barring inflation or some form of default. People keep saying the debt was worse during WW2, which it was, but state, local, student, personal debts were nowhere near as bad. None of them have enough money. In my case, Cook County is broke, Illinois is broke, Chicago is broke, and the US owes 15 trillion. If all these littler entities raise taxes to stay afloat, and the Federal Government does the same, that is a great deal of pain for most taxpayers.

The Federal debt per taxpayer is 133,000. Do you think the average taxpayer has that kind of money? For the ones who do, do they want to give in that money? And that's just the Federal. Makes me want to move to Wyoming or North Dakota, when I look at how broke my state and country are.

 

Its a good point. The local municipalities will just keep taxing until the taxpayers revolt, but if you are in a location where the majority are on the dole, who is going to do that? I am very serious that people in the major towns are in danger. Their house can be taxed into worthlessness, it has happened before. I am just saying I would not wish to live in major cities, or a few states, if I actually wanted to count on my house being worth anything. You house value is directly affected by property taxes, since most borrowers only worry about monthly payments.

I have friends who bought houses in such areas, and their house keeps going down every year, even before the latest housing crisis. One friend had property taxes of $3k a year 12 years ago, today its $11k. Even with low interest rates, every $1000 of higher taxes lowers your property value about $10k roughly.

Chris

 

that is a scary thought. that is also a lot of money.

jaf

 

I read recently that the State and Local debt in the US is another $4.2 Trillion. If we confiscate everything the wealthiest 1% own, we can run the Federal government for just nine (9) months...then we've killed the "Golden Goose".

We need more revenues...but that's best done by expanding our tax base to include our imports, our vast under-the-table economy, criminals, and illegal aliens. We also need to take the imbedded income tax out of the products we sell overseas if our exports are going to be competitive. A consumption tax (not a VAT) on all US and foreign goods will do the trick.

That's why Herman Cain's 9-9-9 tax plan makes so much sense as an interim step towards the Fair Tax. :thumb: