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CrackAddict
Trad climber
Joshua Tree
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Jul 12, 2011 - 06:46pm PT
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Geithner has never been right about anything (he didn't even think there was a housing bubble) but he is probably right about one thing - a U.S. default will be pretty disastrous. The problem is that through thoughtful central planning, our leaders have swapped out our long dated treasuries with short dated ones, averaging less than 5 years, in order to get a lower rate and finance more spending! In other words, we have the sovereign equivalent of a "teaser rate" on our National debt. Short term rates are very volatile, and even a 1% increase due to a technical default will cost us hundreds of billions of dollars.
And Dr. F, you and Dr. Krugman are way off. Right now government expenditures are a COST, not a benefit. We have played out the debt spending binge for all it is worth - we basically have an economy that is immune to stimulus. Look at a chart of increase in GDP per borrowed dollar spent by the government - 50 years ago when we had a relatively small debt we got roughly a $0.90 increase in GDP, but as our debt increased it has dropped to near zero - right now we are barely above $0.10. We are literally throwing money down the toilet when we loan it to the government, in terms of boosting the economy. Corporate, private and government debt vs. GDP is higher right now that it has been at any other time, even the Great Depression - and we did not come out of the Great Depression UNTIL we paid down our combined debt (which didn't happen until the 40s).
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August West
Trad climber
Where the wind blows strange
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Jul 14, 2011 - 01:42pm PT
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Right now government expenditures are a COST, not a benefit. We have played out the debt spending binge for all it is worth - we basically have an economy that is immune to stimulus.
So if we slash government spending and lay off hundred of thousands of more teachers and other government workers the economy magically expands.
On the other hand, if we hire thousands of more teachers and spend billion of dollars fixing bridges, highways, buildings, sewers etc. The economy magically contracts.
Peace is War.
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CrackAddict
Trad climber
Joshua Tree
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Jul 14, 2011 - 01:57pm PT
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Depends on what you mean by the economy "expanding" and "contracting". Are you talking about GDP? Since 2008 we have added $5 Trillion to our debt in exchange for about $500 Billion in GDP "expansion". Does that sound like a good deal to you? And can you really argue that since 2008 our economy is "expanding" because GDP has increased since then?
We don't have to eliminate all government to get the economy going. But make no mistake, government is a cost, not a benefit. Look at what is happening in Europe right now - most countries are coming to grips with the fact that their governments have grown beyond what they can afford. If your logic is correct, countries like Greece just need to spend more, right?
Of course, things like education and health care can be considered investments. But the U.S. has shown that doubling and quadrupling the money on these things leads to diminishing returns, and the question is now what can we afford. For example, any homeless person knows that "you need to have money to make money", but how has that helped them?
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High Fructose Corn Spirit
Gym climber
-A community of hairless apes
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Topic Author's Reply - Oct 27, 2011 - 01:56pm PT
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Extrapolating, I have figured it will hit $15 trillion on 2 nov 2011.
http://www.usdebtclock.org/
It's getting pretty close. Not bad for a 10-month "prophecy," eh? ;)
.....
Silver's on the rise again.
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Norton
Social climber
the Wastelands
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Oct 27, 2011 - 01:59pm PT
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OVER 2/3 of the National Debt was added by only two Republican Presidents.
Oh the IRONY
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High Fructose Corn Spirit
Gym climber
-A race of corn eaters
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Topic Author's Reply - Aug 29, 2012 - 09:06pm PT
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Approaching 16T now.
http://www.usdebtclock.org/
That's 160 $100B assets. How much would the Chinese pay, I wonder, for San Francisco (recall Hong Kong). For Yosemite?
This guy said not to worry though.
Because the country's rich.
Hakuna matata.
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couchmaster
climber
pdx
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Oct 18, 2013 - 03:08pm PT
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To all you democrats crowing on the republicans are bigger as#@&%es than democrats thread that you "won" the recent government shutdown: congratulations, the US debt now equals $17.075 trillion, according to figures the Treasury Department posted online today. Even the US Debt clock Fructose posted up thread can't keep up.
Winners? You think you "won"? You dems must be part of the huge amount of citizens who don't pay taxes. For the rest of us paying our share (ie taxpayers), we all owe over $148,000 (avg per taxpayer) in back taxes which we will have to pay in the future. 1/5 of the US debt is going towards interest rate payments.
And so it grows.
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High Fructose Corn Spirit
Gym climber
Potemkin Village
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Topic Author's Reply - Oct 18, 2013 - 03:26pm PT
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Maybe Larry Summers was right: Maybe the debt is not that big a deal, afterall; maybe the country should focus on growth (infrastructure, etc.) and not austerity measures? Just a thought.
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matty
Trad climber
under the sea
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Oct 18, 2013 - 04:28pm PT
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Problem is people see the government bailing everyone out...people go bankrupt and have their debts waived...banks get bailed out because they are "to big to fail" (to big to succeed?)...home loans get forgiven... or people walk away from houses and leave the bank with the debt...
So it's no surprise that people are not concerned with government overspending because all around us we see people living on credit, buying what they cannot afford and then being revealed of the consequences. This teaches people that nothing really bad happens from overspending. But who will bail out the government? Either we pay more taxes or they print more money or raise interest rates.
I hate different aspect so Dems and Repubs, so I could say the same thing about Bush (just cut the numbers in half) but the terrible truth is...
Obama has on average spent about a thousand billion dollars more per year than the government takes in. This is about 1/3 of each years total federal budget. How can we survive if we spend 30% more than we earn each year?
I'm mad as hell that the general population can vote to spend money we do not have and screw the productive people who shoulder the entire burden. It gets to a point where people just stop trying to be productive because it's just going to be taxed away and used to support programs which are destroying the country financially. Why struggle to achieve when those achievements will be taken and used to support the very ideas that are causing the problems in the first place.
The reality is we cannot keep spend more money than we have. The consequences of not being fiscally responsible will far outweigh the short term pain felt from reducing our budget.
I'm out...my heads gunna blow up!
If you made $50,000 a year but spent $65,000 how long could it last?
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SteveW
Trad climber
The state of confusion
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Oct 18, 2013 - 04:49pm PT
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Did Larry Summers say that, HFCS? I don't think so. . .
maybe Robert Reich or Joseph Stiglitz. . .
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Barbarian
climber
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Oct 18, 2013 - 05:08pm PT
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ho hum
yadda yadda yadda
blather blather
I'm right
You're wrong
repeat infinitum ad nauseam
I'm going climbing....have a nice day.
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SteveW
Trad climber
The state of confusion
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Oct 18, 2013 - 05:18pm PT
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HCFS--interesting--it just doesn't sound like the REAL Larry Summers,
who's more interested in having the big banks and other 1% just get
richer. . .
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couchmaster
climber
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Nov 18, 2014 - 06:02pm PT
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$15 trillion? Longing for those days.
Interesting take on the whole (hole?) thing:
"Chinese Citizens Gather In Beijing Square To Watch U.S. National Debt Clock Strike $18 Trillion
News in Brief • World • foreign affairs • money • finance • china • News • ISSUE 50•45 • Nov 14, 2014
"BEIJING—Celebrating the milestone with hugs, jubilant cheers, and singing, over 600,000 Chinese citizens assembled in Tiananmen Square today to watch the U.S. debt clock mounted above the Forbidden City reach the landmark sum of $18 trillion dollars. “You could stay home and watch it on TV, but it’s much more exciting to be here with people from all over the country to celebrate this momentous day,” said Beijing resident Xiao Bu, noting that he always arrives in the early morning to stake out a good location in the square every time America’s debt rises by another trillion. “I remember my father taking me to see the $5 trillion mark so long ago, and now I’m bringing my own children here to take part in the festivities. It’s really a special part of our nation’s culture.” While most revelers left shortly after the rollover, an estimated 100,000 reportedly decided to just wait around in the square until the clock struck $19 trillion."
LOL. Needs a graph. Love teh Onion.
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WBraun
climber
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Nov 18, 2014 - 06:08pm PT
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Yes, ... 18 trillion dollars and the American citizens let these lunatic criminal politards do this bullsh!t and still going on.
Americans are insane and lunatic also .....
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Reilly
Mountain climber
The Other Monrovia- CA
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Nov 18, 2014 - 06:32pm PT
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Those Chinese have a debt clock going too, they're just not aware of it.
So that makes them even stoopider.
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zBrown
Ice climber
Brujò de la Playa
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Nov 18, 2014 - 06:42pm PT
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Ownership of publicly held debt as of September 30, 2010:
Ownership of U.S. government debt by foreign creditors as of January 31, 2011:
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grover
climber
Northern Mexico
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Nov 18, 2014 - 10:11pm PT
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Those Chinese sure know how to party.
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couchmaster
climber
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$19 Trillion
http://www.usdebtclock.org/
PS, every taxpayer owes $158,835 to pay off the debt. This is money we are borrowing from private banks. You can bet that they will not be forgiving that debt. Crankloon of course, living in his moms basement, will someday be aware of this simple fact once he starts to work. Meantime, that's what us taxpayers are on the hook for. It makes you wonder what the end game is going to be. Jim Rogers and David Stockman, some of the savviest folks in the country are not fans.
Rogers -invest in farmland
Stockman - run for the hills.
Of course, no one knows the timing. Could be 10 years when the baby boomers start to retire and the debt is $30 trillion. Hmmm.
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climbski2
Mountain climber
Anchorage AK, Reno NV
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Or simply print a single 19trillion dollar bill. PAID IN FULL 30 seconds typing on a keyboard somewhere.
WTF is money at this level?
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