Our Unsustainable debt .
WaveCameCrashin
Posts: 2,929
Please watch.
http://www.youtube.com/watch?v=qMEsIMA_ ... re=related :shock: :(
http://www.youtube.com/watch?v=qMEsIMA_ ... re=related :shock: :(
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Our government is the potent, the omnipresent teacher. For good or for ill, it teaches the whole people by its example. Crime is contagious. If the government becomes a law-breaker, it breeds contempt for law; it invites every man to become a law unto himself; it invites anarchy. - Louis Brandeis
Or don't.. I could really care less.
http://reason.com/archives/2010/05/11/o ... nable-debt
http://www.washingtonpost.com/wp-dyn/co ... 03991.html
http://www.nytimes.com/2010/06/10/busin ... 10fed.html
http://www.washingtontimes.com/news/201 ... indicated/
http://useconomy.about.com/od/fiscalpol ... S_Debt.htm
The deck chairs on this particular Titanic were rearranged at mid-week, the Republicans winning the House of Representatives and the Federal Reserve launching a second round of quantitative easing. And the band played on.
The band in this case was Wall Street, which viewed the Fed’s commitment to printing more money to help relaunch the recovery and the GOP victory over President Obama’s Democrats as early Christmas gifts. As one trader in the Chicago futures pits noted on Wednesday, “It’s no time to be short anything, except the U.S. dollar.”
And just about everything did go up that afternoon after the Fed’s announcement and on Thursday, except the greenback, with the benchmark S&P 500 index adding to its 15% gains since the end of August.
Who says you can’t keep partying even when the United States is steaming toward the economic and fiscal icebergs looming on the horizon? Not Wall Street.
America is in no imminent danger of sinking like the Titanic did in 1912. But like the Titanic, the United States is not “unsinkable.” Loaded down with rapidly mounting levels of debt and political baggage, this vessel, already taking on water, is in danger of going under at some point unless the load is lightened.
And that date is drawing closer at an increasing rate of knots. President Obama, “shellacked” in this week’s mid-term elections, will be fighting for his second term in 2012 just as the U.S. national debt passes the 100%-of-GDP mark, a dubious achievement that will be duly noted by the Republicans.
But while the Republicans are waiting to take the bridge in 2013 after regaining the captaincy of the not-so-good ship America, neither they nor the Democrats have credible plans to make even a small dent in spending. And with Obama ready to compromise on keeping the Bush tax cuts, there will be minimal revenue help from that quarter.
To get a picture of the enormous problems and the mounting seas facing the country, check out the real-time U.S. National Debt Clock at www.usdebtclock.org. It is a page pulsating with big numbers getting bigger by the nanosecond, a scary but fascinating quilt giving a fiscal picture of the United States.
Anyone doubting the predicament facing the country will be doubters no more. The site even has a page predicting where debts and revenues will be in 2015. And while those who compute these things see the debt-to-GDP ratio falling below 100% by that date, the sheer size of the numbers is daunting.
As a wise person once observed, something that cannot go on forever will end. There is absolutely no doubt that spending must be cut and revenues must be increased to get the ship righted. No doubt.
But Washington is not about to do that in any significant way, save to rearrange those deck chairs. The Tea Party activists say their biggest goal is to cut spending, but lo betide those who even suggest tampering with Social Security, Medicare, the single biggest drain on the national purse, or the defence budget.
Meantime, the launch of QE2, welcomed by the Street, is not likely to have a major effect on an economy officially under way but still in the post-financial crisis doldrums with housing and unemployment anchors dragging along the bottom. Six hundred billion used to be a lot of money. But with recent annual deficits well over a trillion, it might help only at the margins.
And yet on Wall Street, the band plays on. And why not, really? For canny old salts confident of their navigational skills and with life-boats always at the ready, trading profits are there to be made, as they have been these past two months despite the mounting economic seas.
Stock values, as measured by forward price/earnings ratios, are still not unreasonable by historic measures. But earnings and revenue growth rates, like the U.S. economy itself, are beginning to decelerate. While many S&P 500 companies make large chunks of their profits overseas and have been able to make large productivity improvements, GDP making headway at barely 2% in local waters doesn’t bode well for market prospects as 2011 unfolds.
So the life-boats will be at the ready as the Titanic and its heavy load head toward an uncertain destination. Meantime, the politicians and the folks at the Fed can fiddle with the deck-chairs.
Financial Post
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Read more: http://www.financialpost.com/news/like+ ... z14eXi8CKe
"Life Is What Happens To You When Your Busy Making Other Plans" John Lennon
And the idea of China or any other nation that can or will force our hand to pay up is not realistic. It's taking a fact and spinning it into an unrealistic situation which will not ever occur. The debt has and will be a bad problem going forward, but with that stated, we run the world economy and with our well being, goes the rest of the worlds'. And yes, even after our economy hit the dumps and you didn't hear any international outcry for re-payment, instead we saw the exact opposite occur. A global alliance to fix the spread of the problem and promise of future funds to international organizations like the G-8, IMF and WB in order to maintain the status quo - with US leadership. Here's a link to a great article all about the double standard we have set in the global economy basically cause we rule the roost. http://www.theatlantic.com/magazine/archive/2009/05/the-quiet-coup/7364/ And please do reply in response to my post, the details of the article and anything else you'd like to add.. I'll be waiting.
Our government is the potent, the omnipresent teacher. For good or for ill, it teaches the whole people by its example. Crime is contagious. If the government becomes a law-breaker, it breeds contempt for law; it invites every man to become a law unto himself; it invites anarchy. - Louis Brandeis