US defaults :-)

Discussion in 'Economics' started by mutluit, Oct 30, 2012.

  1. mutluit



    The Outstanding Public Debt as of 30 Oct 2012 at 09:15:08 PM GMT is:

    The estimated population of the United States is 313,781,177, so each citizen's share of this debt is $51,637.08.

    The National Debt has continued to increase an average of $3.87 billion per day since September 28, 2007!

  2. well. nothing new.. look at the 50 year chart.. the breakaway is clearly from the 80s. So an entire generation last 33 years has been living on an entitled style. high purchasing power..

    we have somethnig which no one posseses.. the printing press and un ending faith on the USD.. .when peru wants to trade with S Korea, they settle their FOREX in . guess what.. USD!!!!! since we are the defacto currency, the faith is still held. but for how long. .who knows. who cares.!. print away my freind bernanke.. kick the can down the road.. why 16T. why not 20. 30 50T...
  3. mutluit


    As the above chart shows, the US debt spirale was started by president Reagan (Republican) in 1981, only Clinton was successful to stop the spirale, but then came Bush...
  4. pl. dont accuse republican or democrat.. both are the same..

    this is barrelling towards a big black swan.
    only 1 prob. .
    who will bell the cat.. .
    who can call this bluff..
    who can ask US to rein in their fiscal debt..
    no country on this planet.. !!!
  5. mutluit


    Just by some Puts, as a kind of insurance...
  6. toc


    Reagan debt spiral resulted in world getting rid of communism and socialism in hard flavors.

    Clinton did squat-all. He had golden opportunity to cut down defense, even at $100B a year and find savings in other areas and given the internet boom and higher tax revenues, he could have actually brought the debt down. Worst, he created the sub-prime mortgage scheme which caused biggest financial markets crash in 2008 finally. This called for various stiumuls and QE programs which have hidden side effects of their own.

    Bush brought in Iraq war, tax breaks for rich, and kept on higher spending in Afghanistan with no end in sight.

    Obama did put an end to Iraq and put a date to Afghanistan. But could not do much else. May be put in Obamacare which other side of the aisle does not like a bit.

    Politics is what ruins the nations. US can still reverse the damage but there needs to be someone who can BELL THE CAT!
  7. There are 5 in my family (Me, Wife, 3 kids) Every month its like the government steals our credit card and puts $1,750 on it EVERY month. Thats how out of control this spending is. The average person doesnt even pay that much for his house. No way is this EVER getting paid back.
  8. mutluit


    Interessting analysis:
    Rising interest rates could be devastating

    The federal government has $16 trillion of debt, $11 trillion of which is owned by the public (the rest is held by government entities like Social Security). Last year we paid $230 billion in interest on that debt, so the average interest rate is a little over 2%.

    That's incredibly low, and returning to more average interest rates could balloon the deficit. Since 1970, the average interest rate paid on debt held by the public is 5.9%. If interest rates returned to that average, our annual interest tab would rise by $400 billion. That's about four times what the federal government currently spends on education and training. The average interest rate on federal debt was highest in 1982, at 9.3%. Returning to that level would add $800 billion to our annual interest bill, which is more than we currently spend on Social Security.

    Households aren't in much better shape. Since 2009, investors have pumped nearly $1 trillion into bond mutual funds, $400 billion into Treasuries, and more still into bond ETFs. If interest rates rise, the value of these investments could fall sharply. The last time interest rates were near current levels, in the 1950s, Treasury bonds lost 40% of their inflation-adjusted value over the following three decades.

    Another interessting analysis is the following, which shows China's financials is more at danger than the US:

    but OTOH nowadays we live in a global intertwined economy, everything depends on each other, meaning: normally no one can afford a crisis... but still, a remote crisis can also be an opportunity... :D
  9. +1

    see...the only thing the Democrats/republicans will do is.:
    -serve their SUPER PACS and lobby groups/special interest groups.
    -do WHAT EVER it takes to get elected.!
    -kick the can down the road.
    -operate printing press at breakneck speed..

    what was that AC/DC song.. i am on the highway to hell !!!!! no stop sign. no speed limit..!!..

  10. +1
    super correct.
    and they dont flinch a damn eyelid.. this is astonishing!.
    truth is STRANGER Than fiction. .all real dollars..
    we cant fathom this.
    we cant handle the truth. -to quote Jack nicholsen. ha ha..

    OK jokes apart.. think hard and think deep. what assets will hold value after 20 years.. income producing assets. preferred..
    i am diversifying out of the USA. global ADRs ETFs.. in countries which have stable GDP /debt ratios..

    funny thing is . many SP500 companies are global players have fantastic balance sheets... PEP/ KO PG.. CL etc etc..
    #10     Nov 6, 2012