Category: US Debt
The analysis published under this category are as follows.
Friday, June 13, 2014
Debt is No Salvation / Economics / US Debt
By: Peter_Schiff
Thus far 2014 has been a fertile year for really stupid economic ideas. But of all the half-baked doozies that have come down the pike (the perils of "lowflation," Thomas Piketty's claims about capitalism creating poverty, and President Obama's "pay as you earn" solution to student debt), an idea hatched last week by CNBC's reliably ridiculous Steve Liesman may in fact take the cake. In diagnosing the causes of the continued malaise in the U.S. economy he explained, "the problem is that consumers are not taking on enough debt." And that "historically the U.S. economy has been built on consumer credit." His conclusion: Consumers must be encouraged to borrow more money and spend it. Given that Liesman is CNBC's senior economic reporter, I would hate to see the ideas the junior people come up with.Read full article... Read full article...
Wednesday, June 11, 2014
The US Government Has Nearly As Much Debt As The World Has Wealth / Economics / US Debt
By: Jeff_Berwick
According to a study by the Boston Consulting Group, privately held wealth increased to $152 trillion globally in 2013.
Compare this to estimates putting the US federal government's total debts and liabilities alone at anywhere from $78 trillion to $200 trillion and you can see just how untenable the US government's debt is. The US government is nearly indebted to the equivalent of all the privately held wealth in the world and possibly more!
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Saturday, May 24, 2014
How the Government and the Fed are Looting Your Accumulated Wealth / News_Letter / US Debt
By: NewsLetter
The Market Oracle NewsletterMay 14th , 2014 Issue # 11 Vol. 8
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Wednesday, May 14, 2014
Can U.S. $17 Trillion In Debt Survive Higher Interest Rates? / Interest-Rates / US Debt
By: Dan_Amerman
The United States federal government currently has about $17.5 trillion in debt outstanding. What this means is that if the interest rate on that debt were to rise by even 1%, the annual federal deficit rises by $175 billion. A 2% increase in interest rate levels would increase the federal deficit by $350 billion, and if rates were 5% higher, the annual federal deficit rises by $875 billion.
Clearly, the federal government cannot afford substantially higher interest rates.
At the very same time, because of the current extremely low interest rate environment, tens of millions of retirees and long term investors have seen their returns slashed, with potential reductions in their standard of living as well.
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Monday, May 05, 2014
Underappreciated Indicators to Guide You through a Debt-Saturated Economy / Economics / US Debt
By: F_F_Wiley
If you’re my generation or older, you may remember taking the original Pepsi Challenge – the Coke versus Pepsi taste testing booths that you would find at sporting events, fairs and similar venues. I took the Challenge and stuck with Coke. The majority of people went the other way, as confirmed by even Coke’s private tests. Nowadays, though, I’m guessing the public version of a Challenge booth would bring heckling from the nutrition-conscious folks at the Just Juice stand. The bigger challenges for Coke and Pepsi are health risks linked to their flagship products. Researchers are zeroing in on a handful of ingredients that may be harmful, such as sodium benzoate and phosphoric acid.
Friday, May 02, 2014
The Fiscal Land Mine of Chicago / Politics / US Debt
By: Jeff_Berwick
Wendy McElroy writes: Chicago dances on the edge of a fiscal cliff.
It is the third largest city in the US with a population of 2,714,856 as of mid-2012. It is the economic engine of Illinois. If Chicago falls, especially into bankruptcy, then the entire state is likely to do so as well. Illinois won’t declare bankruptcy because federal law prohibits the option. But insolvency would raise many of the same questions as bankruptcy. For example, who gets paid first, or at all? And how much on the dollar? If other cities stumble, as they would, then whether Illinois officially declares bankruptcy may be a matter of semantics.
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Friday, April 25, 2014
The Great American Giveaway / Politics / US Debt
By: Andy_Sutton
What do the national debt and a designer Hepatitis C drug have in common? This question actually spans two areas near and dear to my heart: economics and medicine. What I’m going to be covering this week is something that I feel is going to be part of a growing trend in America over the coming decades. You see, too many – myself included for quite a while – were asking the wrong questions. Many still are. We shouldn’t be asking what we can do, conventionally speaking, to pay off the national debt because it cannot be done. Consider the unfunded liability portion and that should be obvious to everyone. So what? We just default? That has been suggested. With devaluation we’ve already been doing it, albeit with sleight of hand. Don’t count on the fact that the debtors are ignorant though because they aren’t. This article is going to prove that.
Thursday, April 17, 2014
Chicago, the Windy City has a $26.5 Billion Pension Problem / Politics / US Debt
By: Survive-Prosper
Rodney Johnson writes: The Windy City has a $26.5 billion problem — it is short of that amount.
That’s a lot of dough for one town.
Overseers of the city’s finances haven’t kept up with their payments to the city pension funds, while the investment gurus running the funds haven’t been able to make their projected returns.
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Thursday, April 17, 2014
Even The US Government Will Abandon the U.S. Dollar / Politics / US Debt
By: Jeff_Berwick
For millions it is already too late.
They won't realize the geopolitical winds which are now blowing. Off in their own lala land, the average American will be focused on sports, celebrities, what the right amount of stealing (taxes) in society is, gay rights, which foreign countries "we" should bomb next, the first woman president, and so on and so forth, while their livelihoods are sacrificed in the name of the US government.
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Sunday, April 06, 2014
The Unsustainable Distortion That is America / Politics / US Debt
By: Gordon_T_Long
The Peril of a Two Class Society
Since the end of WWII the US might be considered as being divided into two eras. The first from after the war untill 1979 and the second from 1979 until today. The era's are determined by the growth of family income.
As dramatically different as these two eras are, they are even worse when we consider the structural change, where the US family income shifted from a single to a two family income, which closely mirrors these two eras.
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Wednesday, April 02, 2014
The U.S. Budget Box & Containing Debt and Deficit Craziness / Politics / US Debt
By: DeviantInvestor
Imagine that the US government is, euphemistically speaking, locked in a box created by deficits, debts, and decisions. There are six sides to the box - each an exit. We can describe them as:
Monday, March 31, 2014
Ukraine Capital Controls and 200% Inflation But Still In Better Shape Than US! / Politics / US Debt
By: Jeff_Berwick
In a TV address to a torn nation, Ukraine's PM Yatsenyuk first implied heating prices would rise incrementally, and then later confirmed a plan to increase prices 100% in the next two years (and nearly 200% by 2017) as the cost of imported Russian gas is expected to rise to $500 from the current $84.
Tuesday, March 25, 2014
Why Is The Federal Deficit Really Falling? / Interest-Rates / US Debt
By: Dan_Amerman
There are two ways a nation can use economic growth to reduce budget deficits. The first method is to participate in economic growth, with a growing economy increasing tax collections. A second method is to raise taxes so drastically that they consume all economic growth.
Saturday, March 22, 2014
Debt and Taxes / Politics / US Debt
By: Peter_Schiff
The red flags contained in the national and global headlines that have come out thus far in 2014 should have spooked investors and economic forecasters. Instead the markets have barely noticed. It seems that the majority opinion on Wall Street and Washington is that we have entered an era of good fortune made possible by the benevolent hand of the Federal Reserve. Ben Bernanke and now Janet Yellen have apparently removed all the economic rough edges that would normally draw blood. As a result of this monetary "baby-proofing," a strong economy is no longer considered necessary for rising stock and real estate prices.
Wednesday, March 12, 2014
How Global Debt of More Than $100 Trillion Is Threatening Your Portfolio / Politics / US Debt
By: DailyGainsLetter
Sasha Cekerevac writes: There is a recent statistic that is quite shocking: the total amount of debt globally is now over $100 trillion, a jump of 40% over the last six years.
According to the Bank for International Settlements, which is run by 60 central banks, since the financial crisis, the majority of the $100 trillion in debt has been issued by governments and nonfinancial corporations. (Source: “March 2014 quarterly review,” Bank for International Settlements web site, March 9, 2014.)
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Wednesday, March 12, 2014
Does a $100 Trillion Debt Total Matter? / Politics / US Debt
By: BATR
Debt is everywhere but it just does not seem to matter. Thanks to the folks at Zero Hedge, you get the account Global Debt Crosses $100 Trillion, Rises By $30 Trillion Since 2007; $27 Trillion Is "Foreign-Held" – "Total global debt has exploded by 40% in just 6 short years from 2007 to 2013, from "only" $70 trillion to over $100 trillion as of mid-2013, according to the BIS' just-released quarterly review". They make this assessment:
Tuesday, March 11, 2014
State Debt Conversion In An Equity Bubble - The Tried And Tested Trick / Politics / US Debt
By: Andrew_McKillop
John Law's Trick Which Failed
According to the Federal Reserve Bank of Chicago's economist Francois R. Velde in a 64-page memorandum published by the Reserve Bank in November 2003, written with seven other US Federal Reserve Bank economists, John Law succeeded in the period 1716-1720 to convert the government or state debt – at the time Royal debt - of France, into state-backed equity holdings. At the same time, in a coordinated move, Law also replaced silver- and gold-backed money with paper “fiat” money.
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Saturday, February 22, 2014
How to Protect Your Money When the U.S. Debt Bill Comes Due / News_Letter / US Debt
By: NewsLetter
The Market Oracle NewsletterOctober 26th , 2013 Issue # 18 Vol. 7
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Thursday, January 16, 2014
Why We Can Not Buy Our Way Out Of Debt / Interest-Rates / US Debt
By: Raul_I_Meijer
Last week, there was a discussion in our comments section about the financial “crunch”, the big kahuna, and how it still has not happened despite our insisting it is inevitable, with people saying things like: ‘but the stock markets are way up!’, and ‘in my area home prices are up 30%’. As much as I understand the sentiments, at the same time I don’t really. Certainly for people who read The Automatic Earth, I would have thought it would be clearer what is going on “out there”. I have certainly written more articles than I care to remember about what goes on. Debt is what goes on.
Monday, December 23, 2013
The Debt Rattle - How Do We Define Value? / Politics / US Debt
By: Raul_I_Meijer
I would like to get your thoughts on one of the most basic questions in an economy: what is value, what creates value, and how can value change or even fluctuate? Sometimes it’s best to take a step back and make sure we properly (re-)define the terms we use, lest confusion rules the day.
As a reference for the question(s) I want to use two articles I read over the past week. In particular, I’m interested in discussing whether the Fed’s Quantitative Easing (QE) programs have created value, and whether QE is capable of doing so in the first place. And I don’t mean obvious views like ‘money has no value at all because it’s created out of nothing as credit/debt’, we know that. I want to start with the idea that an asset, a good, plus the work man is capable of, can be assigned a value in dollar terms, and then see how that value is defined.
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