The UST has around 13T worth of cash reserves in the coffers. While the budget deficit is large, the govt. can write a check for the balance of the debt right now if they wanted to. So why would there need to be blood if there is enough real cash on the books to pay off the debt? People keep saying the worst is coming because of the morsels of info they digest from cnn/fox/nbc/etc... instead of drawing conclusions with MSM editorials you should read the hard data and put things into context. We are spending more then we have yoy, however, right now we have the savings to cover it in full. This does mean we have to change our ways, but we are by no means in a dire situation.
Savings are important.... but revenue even more so, and revenue(s) are dropping for all levels of gov't just as expenses (unemployment, medicare, ss, gov't pension obligations, war prosecution...) are rising. See attachment. Kotlikoff wrote this in 2006, well before the US backstopped 23 Trillion in loans, ramped up the Afghanistan War, spent $$$$ on temporary "stimulus," and on and on....
LOL ! Debt levels are off the charts. Total private and public debt is ~60 Trillion. In order to keep asset prices stable, new borrowing has to be greater or equal to, loans paid back. New loans are predicated on income (or revenue) - both at the private and public level. Real wages have been in decline since the 90's. Under-reported inflation, de-industrialization, tax hikes, cap-n-trade, healthcare, over-regulation, etc. Declining private incomes cannot sustain expanded borrowing. It's simple. On the public side, there's enormous debt and long-term entitlement obligations that murder current budget revenues if rates reset 200-300 basis points OR we project 10 years down the road. The only escape for the FED is to print to meet debt service or entitlement obligations, which is why the long-end is selling off and our major trading partners are calling for the end of USD hegemony. When Japan and China have had enough, they'll pull from the Treasury market, the FED will intervene to stabilize (defacto monetization), and we'll get a dollar crash. That's how it'll play out. Suggesting a rosy decade is totally off mark. The best-case scenario is low or no growth, for years. The debt-to-income ratio for America has gone negative (debt way too high, income in terminal decline).
Please state where you got this figure from. The USA has nowhere near even 1 trillion of cash reserves. In fact the USA has less than 1/2 of 1% of annual GDP in cash reserves - by far the lowest percentage of any industrialized nation.
Gief source? Where the hell is this cash? We're having to practically have an American wide revolution here in order to get anywhere near the books the federal reserve or the government has. Do we have gold that would account for this? Do we have any actual figures that aren't just made up crap by the government?
Just search for the us treasury's balance sheet. The cash is with the UST, where else? You're making a mountain out of a molehill - only zealots are about to have a revolution. The Fed is mandated by congress to not be regulated by the govt - that would be like giving the grocery cashier the ability to write their own paycheck each week. Want things to operate differently? Call your congressperson and have them change it. It's up to congress, not the fed, how things work. Yes, I've spent millions of dollars and forced my way into the UST's books. The governments numbers are no more made up than the numbers of the bloggers, radio show hosts, and other nuts that you have already taken to heart. Why do you think everything the govt. publishes is a "made up" number? Because they are big and evil? Or is it because you haven't received your due $$$$$$$ for doing nothing yet and are pissed someone has a newer iPhone than you?
It's because i am krazy. I was reading something else and stumbled across this. Lots of good numbers and puts things is perspective with regard to all the spending recently. http://newsburglar.com/2009/03/13/the-national-balance-sheet-of-the-united-states/
Bill Clinton left office with a 560 Billion budgetary surplus. The last President to enjoy a surplus during their tenure was Nixon (5 Billion). 13 Trillion does not equal 565 Billion. Where did the Treasury get the other 12.5 Trillion in reserves? That's quite a mystery, KrazyKarl.