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NBD. That will become the new norm. No one in the world wants to or capable of destroy the treasury market. So the rate will remain low. Dollar will remain stable, unless Fed and Treasury change their mind. Why do you think Euro remains strong during the past two years? Cuz no one actually wants the Euro to collapse.
lol
Holy SHIT gekko. I think your spelling just made my brain explode.
NBD. You were braindead before this anyway. :P
I'll start with this: http://www.goodcleanhumor.net/wp-content/uploads/new-dollar-bill-nation…
Check the others out if you have time. GekkoTG is mostly right, but there will be pain. http://www.mileanhour.com/files/2010/7/Mark-Smith-SC-auction-slideshow-… http://mugsysrapsheet.com/4blog/Bush-Tax-Cuts-Deficit.jpg http://ecx.images-amazon.com/images/I/41yGaIbEOwL.SL500_AA300.jpg
In summary....AAAAAHAAHHHHHHHHHHH WHAT THE HELL IS GOING ON??!!!?!!?!!?!....
LOL
I don't think many people actually understand how much debt the U.S actually is in.
+1. People that brush this off and think there's not gonna be alot of pain later on are delusional.
Oh there are gonna be pain down the road. Higher tax, slower economic growth, higher inflation, and destabilization of dollar... Or sudden devaluation of the dollar...
But for the moment, there won't be any crisis. US assets remain attractive in comparison to the rest of the world.
There is no way we can pay even a marginal proportion of this debt. We will either declare bankruptcy or inflate our debt away. When the mania about Europe dies, all eyes will look toward our woeful position.
I agree our best-case* scenario is defaulting through inflation.
there is no "best case scenario".....this is truly unbelievable how fucked the US is. Death by hyperinflation or death by write downs. Two very painful deaths
We don't need to pay it back, as long as we can roll them over. What we need to do is to control budget deficit and stimulate long term growth. If your GDP is growing faster than interest paid on your debt, you generally won't have a solvency problem. Also, we export a lot stuff too. Not a terrible situation, just something we need to pay attention to.
How'd that work out for Madoff?
He filed bankruptcy because he can't roll them over. That was my point. You analogy doesn't apply to US government. We never need to file bankruptcy. Worse case scenario, we devalue dollar. If it comes to that, then I don't see any security is safe. If you think US government is gonna default, no counter party in this world is gonna make good on CDS, he/she sold you, on treasury. You might as well just buy gold, food and ammunition. So we either roll them over or inflate them away. Either way we don't need to pay them back.
The debt problem is worrisome in the sense that it hinders the long term growth rate of US economy, as it drains resources, we could have invested to improve productivity, to pay interest from society.
This is so humiliating.... debt per capita is now 48,089. whats income per capital? yea thats what I though....
Waiting for bondarb to show up...
Agree with above, as long as we can grow our way out of it, who cares. Interest rates are low and we can just roll it over and stretch it out long-term. No one else has this luxury.
You do realize that Italy's interest rates on their long term debt tripled in a week, right? The markets could turn on us and we would be in it deep. At our current path for spending, 100% of the budget will be interest payments on the debt.
That's because they have no monetary authority. This will not happen to us. Upon the first sign of the bank run, Fed will start open market operations and issue statement that they are the lender of last resort. As Joe Biden said, no one in the history has ever made money shorting America. What do you think will happen if ECB starts to buy massive amount Italian debt?
While the $15 trillion debt is worrisome it is not our biggest problem. It will be enough to hinder growth, but the country's unfunded liabilities are what will really crush us.
That comes down to whether the leader can make tough decisions. Personally, I think there are too many programs in US. As someone posted before, the nurses in California are making 275,000 dollar a year. Those programs are mis-allocations of resource, which need to be corrected ASAP in tough times like this.
That leader will never be elected
Trillion. TRILLION FUCKING DOLLARS. wtf???
This president is at 5 trillion so far. The last president...about the same. We need a real.fiscal.conservative to be elected. I don't think we've had one since Roosevelt.
By fiscal conservative, I mean one that ACTUALLY manages money well, and not just one that talks well about managing money.
Why is this so difficult for people to understand? It's like America became a nation of retards about a decade ago and won't snap out of it. It's starting to grate on me.
Keep dreaming if you think the general populous of America wants real change....until the average American can PHYSICALLY feel what is going on..i.e their money is worthless or something to that extremely the average American will never vote for real change. This may be extremely pessimistic but honestly look at what is going on in our world right now. Occupy (insert any city in the U.S) and the Tea Party are the two faces that want real change yet neither side has come up with real tangible ELECTABLE leadership... How exactly do you see real change coming to be?
Also the market is not likely to turn on our bonds in comparison of the Europe. Simply, because the liquidity got no where to go. I can't think of any assets capable of soaking up liquidity of treasury market. Europe is doing worst than us. Chinese currency is not even convertible. All the other EM countries is not gonna survive, if you think US is going down with Europe. Japanese Yen? Japan has higher Debt to GDP than us.
Sometime you wish they found life forms on Mars. So we can make trades and buy CDS from them, as they are truly uncorrelated.
If only it were just $15T.
This is the truth... unfunded LT liabilities is somewhere around $116T...
If we simply exported all of our goods/services and did not consume anything for a year it would all be over. Budget crises solved.
The US economy will not collapse until the Petrodollar system is no longer operating. That's a fact.
we got missiles bros dont worry
US + Europe + IMF=70% of the world's gold. The West will survive.
There is always a way. Start a war. Win it. Make the losers pay. That's always been the solution.
Who should we attack now?
Our nukes are worth about that
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