If we are 9 trillion dollars in debt, why isn't the wolf at the door?

[Iamme]

Well?

Don't we all deep down, think our debt must be a joke? We can joke that if you lined up 9 trillion dollar bills end to end, we'd be able to go to yoranus and back.

They say that we should be concerned that our children and children's children (and etc.)will be paying this debt. Really? Weren't they saying this back in the days of Nixon?

If we are so much in debt, how come we are supposed to be the richest generation ever? How come we are not paying and living in teepees til we get it paid off?

[Solitaire]

They say that we should be concerned that our children and children's children (and etc.)will be paying this debt. Really? Weren't they saying this back in the days of Nixon?

They don't have to. We borrow the money from oversea investors. Then when the loan comes due we borrow the money from them again. All we do is pay interest on the loan which causes the dollar to slowly decrease in value for currency trading purposes.

From this chart, Yahoo Charts, (http://finance.yahoo.com/q/bc?s=USDEUR=X&t=5y) I project that the dollar will fall from 67.5 to 42.5 in 2012. It won't affect us the least bit, so long as we never buy anything like oil from overseas sellers.

See? :) (http://www.istockphoto.com/file_closeup/health_and_beauty/medical_concepts/medical_equipment/1056304_happy_pills.php?id=1056304)

[roger]

I'm not sure I believe the following, but I will present it as a debate point:

Debt is good. Most businesses carry debt as a way to increase returns. For example, borrowing money to buy cars lets you have more cars on your lots, move more vehicles, and thus make more overall profit than if you bought each car outright with your own money.

So long as our GDP keeps increasing, debt is good. Car dealerships, if run efficiently, will never be debt free. Neither should the country.

That begs the question, how much debt can we handle? Clearly carrying too much debt is catastrophic. Well, we can look at the stock market. Suppose the Goverment is being entirely wasteful with the money, and blows every dime. So what? All of that money is going to end up in the hands of people and corporations who will use it more wisely. So long as the stock market continues to generate good returns, the money is being used well, even if that first usage was a bit irregular.

This is not my argument, it is Kenneth Fisher (http://www.financial-planning.com/pubs/fp/20070501014.html)'s. I'm personally undecided on it's merits, but would enjoy reading a discussion debating it.

[Tsukasa Buddha]

I don't really like debt, because when **** goes down, you're kinda screwed.

It happens with people all the time. They can manage to keep afloat with their debt and maintaining their lifestyle until a major illness or divorce, then they go bankrupt.

Though I don't know if that really correlates to national debt.

I am also skeptical of the cop out that it is fine as long as the GDP keeps rising fast enough. IMO, that is wishful thinking.

[hgc]

The wolf's entire economy depends on the engine of our consumer economy. China is merely making investing in the market that fuels its own economic growth. The wolf not about to knock the door down. It's own billion+ people gotta eat.

[Puppycow]

Here's an interesting list, if it's true:
Countries with the highest External National Debt (http://www.aneki.com/debt.html)
(US not in top ten; China is)

Here's some more perspective:
List of countries by public debt (http://en.wikipedia.org/wiki/List_of_countries_by_public_debt)
Japan's public debt is 176% of GDP, wheras the US is 64.7% of GDP
Also, Japanese baby-boomers are beginning to retire and the population is falling.
However, interest rates are near zero in Japan, so since they basically pay interest on the debt, it's not as bad as it would appear. If they ever have to raise interest rates however, watch out. Is this OK? I'm not sure, but I suspect the government does this on purpose to keep the yen weak and maintain the trade surplus with the US.

[Puppycow]

One more thing: Government debt can only increase as long as there are investors out there willing to buy government bonds. The government can issue bonds, but somebody has to buy those bonds. No rational investor would make a loan to somebody if they didn't think it was worth the risk of default. It would seem to make little sense for non-Japanese to invest in Japanese government bonds due to the very low payoff and huge debt. But, banks apparantly buy these, and I suppose they have their reasons (banking seems to be a strange business).

(I should hasten to add that the current subprime loan problem is evidence that lenders do not always accurately assess the borrower's ability (or willingness) to repay the loan).

[lionking]

Here's an interesting list, if it's true:
Countries with the highest External National Debt (http://www.aneki.com/debt.html)
(US not in top ten; China is)

Here's some more perspective:
List of countries by public debt (http://en.wikipedia.org/wiki/List_of_countries_by_public_debt)
Japan's public debt is 176% of GDP, wheras the US is 64.7% of GDP
Also, Japanese baby-boomers are beginning to retire and the population is falling.
However, interest rates are near zero in Japan, so since they basically pay interest on the debt, it's not as bad as it would appear. If they ever have to raise interest rates however, watch out. Is this OK? I'm not sure, but I suspect the government does this on purpose to keep the yen weak and maintain the trade surplus with the US.
I just had a look at your first link. Equatorial Guinea the second highest GDP per capita in the world??????? Is this a reliable list?

[Puppycow]

I just had a look at your first link. Equatorial Guinea the second highest GDP per capita in the world??????? Is this a reliable list?

Apparantly, yes (http://en.wikipedia.org/wiki/Equatorial_Guinea#Economy) (I'm as surprised as you).
The discovery of large oil reserves in 1996 and its subsequent exploitation have contributed to a dramatic increase in government revenue. As of 2004,[12] Equatorial Guinea is the third-largest oil producer in Sub-Saharan Africa. Its oil production has risen to 360,000 barrels/day, up from 220,000 only two years earlier.

Forestry, farming, and fishing are also major components of GDP. Subsistence farming predominates. The deterioration of the rural economy under successive brutal regimes has diminished any potential for agriculture-led growth.

Despite a per capita GDP (PPP) of more than US$30,000[13] (CIA Factbook $50,200[14]) which is as of 2006 the second highest in the world (after Luxembourg), Equatorial Guinea ranks 121st out of 177 countries on the United Nations Human Development Index.
Either that or Wikipedia is also wrong. Both cite the CIA Factbook.

[lionking]

Apparantly, yes (http://en.wikipedia.org/wiki/Equatorial_Guinea#Economy) (I'm as surprised as you).

Either that or Wikipedia is also wrong. Both cite the CIA Factbook.
Well there must be a few very rich oligarchs.

[skoob]

Here's an interesting list, if it's true:
Countries with the highest External National Debt (http://www.aneki.com/debt.html)
(US not in top ten; China is)I'm probably missing something, but that list seems to differ remarkably from the horse's mouth (https://www.cia.gov/library/publications/the-world-factbook/rankorder/2079rank.html).

It's also interesting to look att the external dept per capita (http://www.nationmaster.com/graph/eco_deb_ext_percap-economy-debt-external-per-capita).

[Matteo Martini]

Here's an interesting list, if it's true:
Countries with the highest External National Debt (http://www.aneki.com/debt.html)
(US not in top ten; China is)

Here's some more perspective:
List of countries by public debt (http://en.wikipedia.org/wiki/List_of_countries_by_public_debt)
Japan's public debt is 176% of GDP, wheras the US is 64.7% of GDP
Also, Japanese baby-boomers are beginning to retire and the population is falling.
However, interest rates are near zero in Japan, so since they basically pay interest on the debt, it's not as bad as it would appear. If they ever have to raise interest rates however, watch out. Is this OK? I'm not sure, but I suspect the government does this on purpose to keep the yen weak and maintain the trade surplus with the US.

If you have all your money invested in yen, that is kind of a scary list to see

[Soapy Sam]

That list seems to derive average personal income by dividing GDP by population.
Which is, like many statistics, both correct and meaningless.

[Francesca R]

They say that we should be concerned that our children and children's children (and etc.)will be paying this debt. Really? Weren't they saying this back in the days of Nixon?Your children and your children's children, and immigrants and anyone who spends money in your economy will be servicing that debt, or paying it back or running up more of it.

If we are so much in debt, how come we are supposed to be the richest generation ever? How come we are not paying and living in teepees til we get it paid off?Because you can be rich and still have debts.

[Francesca R]

All we do is pay interest on the loan which causes the dollar to slowly decrease in value for currency trading purposes.

From this chart, Yahoo Charts, (http://finance.yahoo.com/q/bc?s=USDEUR=X&t=5y)I project that the dollar will fall from 67.5 to 42.5 in 2012. It won't affect us the least bit, so long as we never buy anything like oil from overseas sellers.I don't think the level of the US dollar has very much to do with the level of government debt, nor does a falling dollar reduce that debt, since it is mostly denominated in USD. If there was any doubt about the ability of the US government to service its debt then long term government bond yields would not be so close to multi-decade lows.

[Francesca R]

Here's an interesting list, if it's true:
Countries with the highest External National Debt (http://www.aneki.com/debt.html)
(US not in top ten; China is)

Here's some more perspective:
List of countries by public debt (http://en.wikipedia.org/wiki/List_of_countries_by_public_debt)External debt (or assets) and public debt are different things. External debt includes private assets owned by foreigners, which are nothing to do with the government.

Japan's public debt is 176% of GDP, wheras the US is 64.7% of GDP
Also, Japanese baby-boomers are beginning to retire and the population is falling.
However, interest rates are near zero in Japan, so since they basically pay interest on the debt, it's not as bad as it would appear. If they ever have to raise interest rates however, watch out. Is this OK? I'm not sure, but I suspect the government does this on purpose to keep the yen weak and maintain the trade surplus with the US.Japan's trade surplus doesn't help with Japan's public debt, and nor does a weak yen. It does enable Japan to accumulate external assets, which it has. Japan has more foreign assets than liabilities and is the world's biggest net creditor nation.

Higher Japanese interest rates would increase the government's burden of servicing its public debt, but since interest rates are likely to be raised only as the economy grows (raising niminal GDP and the government's tax revenue) there is a powerful offset.

[Francesca R]

It would seem to make little sense for non-Japanese to invest in Japanese government bonds due to the very low payoff and huge debt. But, banks apparantly buy these, and I suppose they have their reasons (banking seems to be a strange business).The bulk of investors in Japanese government bonds are Japanese domestic savers. But it also makes perfect sense for foreign savers to invest unless they think that the price of those bonds is going to collapse because the government is going to default. It is not the absolute level of the bond yield that matters, but a combination of (i) the yield adjusted for inflation and (ii) the yield minus the short term interest rate. Along both of these lines, the return on a Japanese government bond is higher than that on a US one.

(I should hasten to add that the current subprime loan problem is evidence that lenders do not always accurately assess the borrower's ability (or willingness) to repay the loan).Correct, but no government debt has suffered due to the sub-prime problem. In fact it has benefitted as the relative confidence in no-default (of governments) has risen. Nobody is writing down government bonds.

[Francesca R]

If you have all your money invested in yen, that is kind of a scary list to seeIf you are worried about the Japanese government defaulting, or inflating away the value of their debt to you then you would not want to buy JGBs because they would experience capital losses. Since it is perfectly possible to hedge the yen exposure (and actually by doing this, you raise the effective interest rate that you receive from the yen interest rate to your home currency interest rate anyway) then the risk of currency depreciation can be taken out. But if you are not worried about default or monetization (inflation) then the real yield on JGBs is arguably pretty attractive.

[Puppycow]

I'm probably missing something, but that list seems to differ remarkably from the horse's mouth (https://www.cia.gov/library/publications/the-world-factbook/rankorder/2079rank.html). You're right. That was the top link in the google results. It seems to be a site that's just there to rank high on Google and get people to click on ads with minimal effort (no original research). Sorry for linking to that red herring.

It's also interesting to look att the external dept per capita (http://www.nationmaster.com/graph/eco_deb_ext_percap-economy-debt-external-per-capita).
Now that's a better link. Per capita and especially per GDP are more interesting than absolute numbers. Since this is external debt, Japan doesn't look so bad. The wolf should be at Ireland's door, right? And UK at #4 (UK's absolute external debt is almost as large as the US debt). US is down at #51 and Japan at #140. (Most Japanese bonds are held by Japanese).

[Francesca R]

Now that's a better link. Per capita and especially per GDP are more interesting than absolute numbers. Since this is external debt, Japan doesn't look so bad. The wolf should be at Ireland's door, right? And UK at #4 (UK's absolute external debt is almost as large as the US debt). US is down at #51 and Japan at #140. (Most Japanese bonds are held by Japanese).It's gross external debt, so it ignores foreign assets. Japan owns considerably more of the rest of the world than the rest of the world owns of Japan. [link] (http://www.reuters.com/article/economicNews/idUST2258720070524)

[Puppycow]

The bulk of investors in Japanese government bonds are Japanese domestic savers. But it also makes perfect sense for foreign savers to invest unless they think that the price of those bonds is going to collapse because the government is going to default. It is not the absolute level of the bond yield that matters, but a combination of (i) the yield adjusted for inflation and (ii) the yield minus the short term interest rate. Along both of these lines, the return on a Japanese government bond is higher than that on a US one.

Correct, but no government debt has suffered due to the sub-prime problem. In fact it has benefitted as the relative confidence in no-default (of governments) has risen. Nobody is writing down government bonds.

I see. You seem to know more about bonds than me. I've never really invested in bonds.
Would you agree that Japan actively manipulates its currency to keep it as cheap as possible? For example, by purposely running up its debt? Or maybe that is also to avoid deflation? Inflation does not seem to be a problem here. Rather, deflation seems to have been the risk in recent years. If that's the case, running up a huge government debt might actually be a good policy?

[JoeEllison]

I'm not sure I believe the following, but I will present it as a debate point:

Debt is good. Most businesses carry debt as a way to increase returns. For example, borrowing money to buy cars lets you have more cars on your lots, move more vehicles, and thus make more overall profit than if you bought each car outright with your own money.

So long as our GDP keeps increasing, debt is good. Car dealerships, if run efficiently, will never be debt free. Neither should the country.

That begs the question, how much debt can we handle? Clearly carrying too much debt is catastrophic. Well, we can look at the stock market. Suppose the Goverment is being entirely wasteful with the money, and blows every dime. So what? All of that money is going to end up in the hands of people and corporations who will use it more wisely. So long as the stock market continues to generate good returns, the money is being used well, even if that first usage was a bit irregular.

This is not my argument, it is Kenneth Fisher (http://www.financial-planning.com/pubs/fp/20070501014.html)'s. I'm personally undecided on it's merits, but would enjoy reading a discussion debating it.
It is a pretty nonsensical position. It seems at least in part based on the fantasy that money is spent "more wisely" when in the hands of corporations.

[dacium2007]

A few things:

$9 trillion isn't that much for america. A change in goverment and budget and the country can (and has) gone from loosing $800 billion per year, to gaining $600 billion per year. Clinton I believe had it positive 400 billion. USA could get out of debt in a few years if they really wanted to.

Being in debt is not a bad thing, quite the opposite - all fiat money exists as a debt. Money is created to represent personal debt. The net debt in the world is always increasing else the fiat money system does not work. To repay interest on debt, the only possible way is to create more debt. There is nothing wrong with being continually in debt.

The only thing to worry about is the value of the americian dollar. If they keep loaning against it, it will drop in value to the point where US citizens will not be able to afford imports. This would be the biggest worry.

If the goverment is pissing money away, this will cause inflation, as people get money they didn't earn compared to the current value of the dollar. This isn't whats happening.

[JoeEllison]

The wolf's entire economy depends on the engine of our consumer economy. China is merely making investing in the market that fuels its own economic growth. The wolf not about to knock the door down. It's own billion+ people gotta eat.

Not that China's behavior will help us at all.

I'm thinking about Michael Jackson's spending habits, and reported huge debt.

[JoeEllison]

Oh, and borrowing in order to invest is usually a good thing. Borrowing for consumption is the problem. If I borrow $75,000 to go to college, and I go from making $20,000 a year to making $50,000 a year, the temporary debt has created a net increase in my overall wealth. Borrowing to buy a house, when the price you pay with interest is often still less than the value of the home when you finish paying for it, is another example where debt is an overall positive. Buying $20,000 worth of shoes and big-screen TVs and iPods, on credit? Not so much.

[roger]

It is a pretty nonsensical position. It seems at least in part based on the fantasy that money is spent "more wisely" when in the hands of corporations.Wisely in the sense that we are turning the engines of the economy. The Government buys $200 ashtrays. That money goes to the corporation, who buys glass, molds, etc. That money goes to companies that supply glass, molds. A lot of that money is going to salaries of workers, who buy iPods for xmas, plus to the butcher for meat for the table. That money goes to Apple and some farms, who....

I don't see the problem with that aspect of the argument. The money doesn't "disappear".

Even if spent on blatent consumerism, such as champagne, that money goes to the winery, who, being smarter with their money, plunk it in the bank. The bank invests the money in local businesses, who... you get the idea.

[Francesca R]

Would you agree that Japan actively manipulates its currency to keep it as cheap as possible? No. Japanese interest rates are low (which is nominally negative for a currency) because its inflation rate is almost zero. And it has not intervened in the FX market since 2004. I think the yen is "undervalued", but it's due to the market, not manipulative policy.

For example, by purposely running up its debt?The government has issued debt to attempt to support economic growth in the past, not overtly to cheapen the yen.

Or maybe that is also to avoid deflation? Inflation does not seem to be a problem here. Rather, deflation seems to have been the risk in recent years. If that's the case, running up a huge government debt might actually be a good policy?Yes, the Japanese government's fiscal spending has been an effort to avoid (a worsening of) deflation.

[MRC_Hans]

Many good points, but I think one more has to be made: Remember that money is basically fictional. No matter how much we trade in money, or money-equivalents, somewhere up the food-chain there are real goods (including immaterial goods like services). We are really trading goods. All that really happens if a country goes into deep dept is that ultimately, some of those goods did not bring the exchange value originally expected. In other words, you got a little less coffee beans for those pork bellies than you hoped for, or whatever, but that's not going to be the end of the world for most of the traders. So, as long as trade is good, a country can, in principle, run up dept almost endlessly.

I know this is grossly simplified, but...... for Iamme ....;)

Hans

[JoeEllison]

Wisely in the sense that we are turning the engines of the economy. The Government buys $200 ashtrays. That money goes to the corporation, who buys glass, molds, etc. That money goes to companies that supply glass, molds. A lot of that money is going to salaries of workers, who buy iPods for xmas, plus to the butcher for meat for the table. That money goes to Apple and some farms, who....

I don't see the problem with that aspect of the argument. The money doesn't "disappear".

Even if spent on blatent consumerism, such as champagne, that money goes to the winery, who, being smarter with their money, plunk it in the bank. The bank invests the money in local businesses, who... you get the idea.
Lots of money "disappears"... ask the Enron employees who lost their pensions and investments.

[Francesca R]

Oh, and borrowing in order to invest is usually a good thing. Borrowing for consumption is the problem. If I borrow $75,000 to go to college, and I go from making $20,000 a year to making $50,000 a year, the temporary debt has created a net increase in my overall wealth. Borrowing to buy a house, when the price you pay with interest is often still less than the value of the home when you finish paying for it, is another example where debt is an overall positive.There is no guarantee that a house will make you a positive return, nor is that the primary reason for buying your home. The primary reason is to consume housing services. The reason for borrowing to do so is that the expenditure is usually to great to do otherwise--your accumulated liquid assets at the time you buy is often insufficient, but if you employ your human capital productively whilst you are borrowing, you can pay the loan back later.

Thus said, taking out a mortgage is borrowing for consumption, and there is nothing inherently wrong with borrowing for consumption

[roger]

Lots of money "disappears"... ask the Enron employees who lost their pensions and investments.Yes, and that has nothing to do with my point, which is within the context of the entire US economy, not a specific business, which of course can destroy shareholder value. Money is not disappearing in that context, it is growing.

[roger]

The reason for borrowing to do so is that the expenditure is usually to great to do otherwise--your accumulated liquid assets at the time you buy is often insufficient, but if you employ your human capital productively whilst you are borrowing, you can pay the loan back later. Not necessarily. Yes, most people can't afford to buy their homes outright, but your answer ignores leverage. If I can put 50K down, and sell in 5 years with a 100K profit, I just made a very, very good return on investment, after factoring in the interest payments (and tax advantages thereof). People who can perfectly afford to pay for a property still borrow.

You of course can come up with counterexamples - that is not the point. The point that Joe was making is that borrowing can be a financially rewarding proposition. I'm purposely in debt right now for investment purposes. Likewise, the US government is in debt - the question is, does that stimulate the economy above and beyond the debt service. If it does, we should not pay off our debt. If it doesn't, we should reduce our debt.

Debt is the engine of Wall Street. Why should it suddenly be bad when our Government employs it? (I'm not ascribing that position to you, acuity, it's a general question).

[Francesca R]

Debt is the engine of Wall Street. Why should it suddenly be bad when our Government employs it? (I'm not ascribing that position to you, acuity, it's a general question).Of course it is not bad. My argument was to point out that borrowing to consume is also not always "bad", and in some cases can make perfect sense. Housing can be an investment, but first and foremost it is consumption*. If you are confident you will have a higher income in the future, and you want to borrow against that to consume now, it's absolutely fine. (Just don't expect to get bailed out if you get the risk wrong.)

*You could say, I suppose, "If it's only for consumption, then why doesn't everyone rent housing, and let true "investors" own it all?" To that I would respond that the utility of ownership and secure property rights is far broader than the possibility of a financial gain.

[Tokenconservative]

This stuff is, to me, like sex among elephants: it all happens way high up.

However, I am old enough to remember in the 1970s and 80s when we were also up to our eyeballs in debt and trade deficit, the dollar was down (far further than today) and the Japanese, Germans and even Canadians were buying up our country. I remember Canadians putting up skyscrapers in our downtown area before it was much of a downtown.

The fearmongers, monstershouters and doomsayers were everywhere. The End Was Near.

But somehow it never came then.

And it won't now.

The reality is our economy is strong and growing, inflation does not exist, prices for everything from energy to food are down, wages are up unememployment does not exist and despite the political attempts by the handmaidens of the left, the left-advocacy "news" media, there's nothing to indicate, anywhere in the economy that The End is near now, either.

Tokie

[Tokenconservative]

Not necessarily. Yes, most people can't afford to buy their homes outright, but your answer ignores leverage. If I can put 50K down, and sell in 5 years with a 100K profit, I just made a very, very good return on investment, after factoring in the interest payments (and tax advantages thereof). People who can perfectly afford to pay for a property still borrow.

You of course can come up with counterexamples - that is not the point. The point that Joe was making is that borrowing can be a financially rewarding proposition. I'm purposely in debt right now for investment purposes. Likewise, the US government is in debt - the question is, does that stimulate the economy above and beyond the debt service. If it does, we should not pay off our debt. If it doesn't, we should reduce our debt.

Debt is the engine of Wall Street. Why should it suddenly be bad when our Government employs it? (I'm not ascribing that position to you, acuity, it's a general question).

Very good take on it.

Now, go jump out a window because we are doomed--DOOOOOMEEEDDDDDDD!!!!


Tokie

[Matteo Martini]

If you are worried about the Japanese government defaulting, or inflating away the value of their debt to you then you would not want to buy JGBs because they would experience capital losses. Since it is perfectly possible to hedge the yen exposure (and actually by doing this, you raise the effective interest rate that you receive from the yen interest rate to your home currency interest rate anyway) then the risk of currency depreciation can be taken out. But if you are not worried about default or monetization (inflation) then the real yield on JGBs is arguably pretty attractive.

I was not speaking about JGB, but about yen
If I remember well, long time ago, yen/euro exchange as at about 115.
Two years ago it was at 135-140, and all the importers of good to Japan were crying.
Now, it is at 160.
If I buy yen now, I can not see how the yen/euro change will become even more higher

[Iamme]

Here's an interesting list, if it's true:
Countries with the highest External National Debt (http://www.aneki.com/debt.html)
(US not in top ten; China is)

Here's some more perspective:
List of countries by public debt (http://en.wikipedia.org/wiki/List_of_countries_by_public_debt)
Japan's public debt is 176% of GDP, wheras the US is 64.7% of GDP
Also, Japanese baby-boomers are beginning to retire and the population is falling.
However, interest rates are near zero in Japan, so since they basically pay interest on the debt, it's not as bad as it would appear. If they ever have to raise interest rates however, watch out. Is this OK? I'm not sure, but I suspect the government does this on purpose to keep the yen weak and maintain the trade surplus with the US.

If all these major countries are in debt, isn't that like saying that of all the NFL teams,all of them have losing seasons? If those countries are all in debt, where are they getting their money from?; each other? Some game of musical chairs with money?

[Iamme]

Your children and your children's children, and immigrants and anyone who spends money in your economy will be servicing that debt, or paying it back or running up more of it.



Ahhh. Now I am beginning to see the light...the politics fo it all. Let's see. How about if we let 20 million aliens in to help pay our debt?

[Tokenconservative]

Your children and your children's children, and immigrants and anyone who spends money in your economy will be servicing that debt, or paying it back or running up more of it.

Because you can be rich and still have debts.

Gee...that's EXACTLY the same thing, word for word, we were told in the 80s when Reagan was spending so much to destroy the Soviet Union.

Thank GOD Bill Clinton came along in the 1990s to get us out of it!!!

Tokie

[Tokenconservative]

Ahhh. Now I am beginning to see the light...the politics fo it all. Let's see. How about if we let 20 million aliens in to help pay our debt?

Hey, why stop there?

Let's let the 100-120 million in that the Bush-Kennedy scamnesty would've allowed?

The more people we have sucking at the social spending teat, the better for the economy, right?

Tokie

[Tokenconservative]

If all these major countries are in debt, isn't that like saying that of all the NFL teams,all of them have losing seasons? If those countries are all in debt, where are they getting their money from?; each other? Some game of musical chairs with money?

Money is a fungible commodity, it really does not originate in any specific country nor end there.

Tokie

[Tumblehome]

This Wikipedia article (http://en.wikipedia.org/wiki/United_States_public_debt) says the real U.S. debt is more like 59 trillion dollars when you take into account its domestic social security obligations and such.

--As of December 19, 2007, the total U.S. federal debt held by the public was roughly $5 trillion. This does not include the money owed by states, corporations, or individuals, nor does it include the money owed to Social Security beneficiaries in the future. If intragovernment debt obligations are included, the debt figure rises to roughly $9 trillion. If unfunded Medicaid, Social Security, etc. promises are added, this figure rises dramatically to a total of $59.1 trillion.

--In 2006, Professor Laurence Kotlikoff argued the United States must eventually choose between "bankruptcy," raising taxes, or cutting payouts. He assumes there will be an ever-growing payment obligations from Medicare and Medicaid.


Is that any cause for concern, especially since the baby boomers will start collecting their pensions any year now?

[plumjam]

This Wikipedia article (http://en.wikipedia.org/wiki/United_States_public_debt) says the real U.S. debt is more like 59 trillion dollars when you take into account its domestic social security obligations and such.




Is that any cause for concern, especially since the baby boomers will start collecting their pensions any year now?

I remember reading in a couple of places (which I can't quite remember now, but were supposedly written by economists) that the estimated fortune of the Rothschild family is between 100 and 400 trillion dollars.
The theory being that, if you and your subsidiaries control the printing of money, then the numbers start to get a bit meaningless.

In contrast the USA is a bit, well, inadequate.

[Tokenconservative]

I remember reading in a couple of places (which I can't quite remember now, but were supposedly written by economists) that the estimated fortune of the Rothschild family is between 100 and 400 trillion dollars.
The theory being that, if you and your subsidiaries control the printing of money, then the numbers start to get a bit meaningless.

In contrast the USA is a bit, well, inadequate.

This is a truly odd post to me.

Were I (Tokie) to say this, and the number you present seems unreasonable to me, I would be called a moron, a dufus, a tool, a fool, a boob and a stoopid, ig'norant, unedjamaketed redneck racist, and the demands that I provide links--LIIIINKKKKKSSSSSS!!!!! would fill three pages in here.

And yet you do it and nary a word is uttered in that direction.

Curious.

Tokie

[plumjam]

This is a truly odd post to me.

Were I (Tokie) to say this, and the number you present seems unreasonable to me, I would be called a moron, a dufus, a tool, a fool, a boob and a stoopid, ig'norant, unedjamaketed redneck racist, and the demands that I provide links--LIIIINKKKKKSSSSSS!!!!! would fill three pages in here.

And yet you do it and nary a word is uttered in that direction.

Curious.

Tokie

Cheers. Maybe my natural charm allows me to get away with it ;)
I have no way of knowing if it's true/false/exaggerated. Like everyone else here I have to take quite a bit on trust, if I'm going to be able to expand my knowledge of life the universe and everything.
However, it doesn't seem unreasonable to me, seeing as the Rothschilds, Rockefellers, Warburgs etc.. have been, by all accounts, heavily involved in the Central Banks for generations.
It's just common sense that if you print the money then personal wealth becomes a pretty meaningless concept.

[Lonewulf]

This is a truly odd post to me.

Were I (Tokie) to say this, and the number you present seems unreasonable to me, I would be called a moron, a dufus, a tool, a fool, a boob and a stoopid, ig'norant, unedjamaketed redneck racist, and the demands that I provide links--LIIIINKKKKKSSSSSS!!!!! would fill three pages in here.

And yet you do it and nary a word is uttered in that direction.

Curious.

Tokie

This post is odd to me.

You assume that no one responding means that they agree or are tolerant of his post, even though you are the first one to post a reply to the very thread he posted in.

Curious.

It's just common sense that if you print the money then personal wealth becomes a pretty meaningless concept.
Which is why Germany was doing so well with the Mark once upon a time, right?

[plumjam]

Which is why Germany was doing so well with the Mark once upon a time, right?

Did the printing of the money in Germany in any way affect the personal wealth of those who were doing the printing?

[Lonewulf]

Did the printing of the money in Germany in any way affect the personal wealth of those who were doing the printing?
Sure didn't seem to help it.

[Tokenconservative]

This post is odd to me.

You assume that no one responding means that they agree or are tolerant of his post, even though you are the first one to post a reply to the very thread he posted in.

Curious.



What else am I to assume...where are the 20-30 posts screaming for links--LIIIIINKKKKSSSSS!!--to support this quite extraordinary and very specific claim; I say things like: the US economy is not collapsing, and you scream "link? LIIIINKKKKKKKKKK!!!!???"--this guy provides names and specific, very questionable numbers and meh, sure...that works for you?

Curious indeed.

Tokie

[Tokenconservative]

Sure didn't seem to help it.

You seem to have missed the question. He asked whether doing what the German federal bank did, harm those the questioner, in his own CT way, believes were pulling the strings behind the scenes

The German economy was directly responsible for the rise of Hitler and the Nazis...we typically see that when an economy is on the rocks, socialists are viewed as white knights. This is what current monstershouting in the left-advocacy media here is modeled after: make Americans believe (and doing a good job of this) that the economy is a mess, and that only a socialist like Hillary or Obama...whoever, really, is the one who "cares" about "the working stiff" and hopefully we will be able to usher in a halcyon period of joy and fun such as the Nazis brought to Germany.

Tokie

[Lonewulf]

What else am I to assume...where are the 20-30 posts screaming for links--LIIIIINKKKKSSSSS!!--to support this quite extraordinary and very specific claim; I say things like: the US economy is not collapsing, and you scream "link? LIIIINKKKKKKKKKK!!!!???"--this guy provides names and specific, very questionable numbers and meh, sure...that works for you?
Nope, that doesn't.

You assume that silence equals consent, instead of people simply not posting because it's their bedtime.

Curious indeed.
Only to one of your... particular... mental status.

You seem to have missed the question.

Only in your mind.

He asked whether doing what the German federal bank did, harm those the questioner, in his own CT way, believes were pulling the strings behind the scenes
I was capable of spotting that, yes.


The German economy was directly responsible for the rise of Hitler and the Nazis...we typically see that when an economy is on the rocks, socialists are viewed as white knights.
Ah, you're still viewing Nazis as socialists. Are you capable of providing an example of a socialist policy of the Nazi party yet, or will you ignore this question as well?

This is what current monstershouting in the left-advocacy media here is modeled after: make Americans believe (and doing a good job of this) that the economy is a mess, and that only a socialist like Hillary or Obama...whoever, really, is the one who "cares" about "the working stiff" and hopefully we will be able to usher in a halcyon period of joy and fun such as the Nazis brought to Germany.
So Obama is like Hitler. Well, at least you didn't call him Osama. I guess.

It's kinda hilarious when you talk about others being CTers while stating such a thing.

[iAmerican]

Paired with the astronomical rise of "National Debt" is the spiralling concentration of vast personal wealth by a shrinking false-elite profiting from corrupt government...the same false-elite directly tied to the policies "bucked" by John Kennedy, and to his killers. "Fiat Money Inflation in France," by Andrew Dickson White, Cornell's second president, is a great primer on the subject of currency debasement and just who profits.

[ddt]

Did the printing of the money in Germany in any way affect the personal wealth of those who were doing the printing?

In an indirect way, yes. The money printing and resulting hyperinflation in 1922/23 by the fledgling Weimar democracy robbed the large German middle class of its savings, and thus of its trust in the democratic system.

It was that middle class that turned its back on the democratic parties and eventually voted for Hitler.

[Tokenconservative]

In an indirect way, yes. The money printing and resulting hyperinflation in 1922/23 by the fledgling Weimar democracy robbed the large German middle class of its savings, and thus of its trust in the democratic system.

It was that middle class that turned its back on the democratic parties and eventually voted for Hitler.

I think some printing press operators made out pretty well....

Tokie

[Tokenconservative]

In an indirect way, yes.

It was that middle class that turned its back on the democratic parties and eventually voted for Hitler.

And this is the hope of the socialists in America, that by using their media and schools to inculcate Americans with the (false) implication that the economy is tanking, we will turn from conservatism and vote in socialists who can promise the sky, but typically deliver it to you in the form of shackles.

Tokie

[NobbyNobbs]

From Token"Conservative" (http://forums.randi.org/showthread.php?postid=3302708#post3302708):

I don't shout slogans. I may demonstrate how YOU (your side, not necessarily you in particular) shout...not just slogans, but purt' near everything), but I don't have any slogans to shout. Rational people don't operate from platitudes, slogans, bromides and cant.

That's for people who can't think on their own.



Found your slogan for you:

..where are the 20-30 posts screaming for links--LIIIIINKKKKSSSSS!!--........ and you scream "link? LIIIINKKKKKKKKKK!!!!???"--

[Tokenconservative]

From Token"Conservative" (http://forums.randi.org/showthread.php?postid=3302708#post3302708):


Found your slogan for you:

Less a slogan than my calling card:

Tokenconservative, demanding you provide links--LIIIIINNKKKKKSSSSSS!!!--for ten years!


Tokie

[Beerina]

A few things:

$9 trillion isn't that much for america. A change in goverment and budget and the country can (and has) gone from loosing $800 billion per year, to gaining $600 billion per year. Clinton I believe had it positive 400 billion. USA could get out of debt in a few years if they really wanted to.

The increase in government money under Clinton, thanks to some tax increases + the internet bubble, outpaced the ability of Congress to increase spending, odd as it seems. In more normal years of growth, when the budget is balanced, Congress will always spend a little more because the more spent = the more votes they buy. Evolutionarily, that's what Congress is in business for: to spend money to get re-elected. One can increase one's chance at re-election, if the budget is balanced, by spending a little bit more, i.e. running up more debt. As long as the debt doesn't grow w.r.t. gdp too fast, you can sort of get away with it.

Hence a balanced budget is an unstable situation that will correct itself in a few years as spending catches up.

[Tokenconservative]

The increase in government money under Clinton, thanks to some tax increases + the internet bubble, outpaced the ability of Congress to increase spending, odd as it seems. In more normal years of growth, when the budget is balanced, Congress will always spend a little more because the more spent = the more votes they buy. Evolutionarily, that's what Congress is in business for: to spend money to get re-elected. One can increase one's chance at re-election, if the budget is balanced, by spending a little bit more, i.e. running up more debt. As long as the debt doesn't grow w.r.t. gdp too fast, you can sort of get away with it.

Hence a balanced budget is an unstable situation that will correct itself in a few years as spending catches up.

Right, but it's important to remember that it's Congress that sets the budget, not the president as the poster you are responding to seems to be suggesting. Clinton did not "have it" he lucked into it, just as Bush had the bad luck to inherit what he did.

Tokie

[iAmerican]

...It was that middle class that turned its back on the democratic parties and eventually voted for Hitler.

The vote for NSDAP did not occur until the Roman Catholic Council of Bishops at Fulda withdrew the threat of excommunication for any Roman Catholic voting for Hitler's Nazis.

Their American Fifth Column faction killed John Kennedy, and his Executive Order 11,110 - which had destroyed the fiat money, fractional banking franchise of Rome's correspondent bankers in the unconstitutional Federal Reserve Bank.

It is they who are destroying our currency supporting Hitler's banker's homosexual draft-dodging, 9-11-committing grandson, and selling us "down the river" to Chines indebtedness.

The National Debt must be repudiated and the assets of the papal/Rockefeller/Bush BIG OIL Fifth Column expropriated.

Bush and Cheney must be tried with their closest hundred or thousand accomplices, convicted for treason and hanged.

[KoihimeNakamura]

iAmerican: Got well, any proof?

[ddt]

The vote for NSDAP did not occur until the Roman Catholic Council of Bishops at Fulda withdrew the threat of excommunication for any Roman Catholic voting for Hitler's Nazis.

Quite paradoxical; the Council of Bishops you mention took place after the last parliamentary elections!?

A few things to note: the excommunication threat was only for members, not for voters. Not all Germans were catholic, it was about half/half catholic and lutheran.

Lastly, Hitler's rise occurred in the years between 1929-1933. Before that, people already had turned away from democratically aligned parties - the famous "Weimar coalition" of social-democrat SPD and catholic Zentrum had quickly lost its majority. Before Hitler, other right-wing anti-democratic parties such as Hugenberg's DNVP were very popular.

[iAmerican]

iAmerican: Got well, any proof?
Can prove every bit and more...but am not going to write a book in reply. Specific points happily supplied.

[Tokenconservative]

Hey, kids, I have a great idea!!

Let's get WAAAAAYYY off topic and start refighting WWII!

Or the Civil War!!

Yaaayyyyyyyyy!!!

[iAmerican]

Hey, kids, I have a great idea!!

Let's get WAAAAAYYY off topic and start refighting WWII!

Or the Civil War!!

Yaaayyyyyyyyy!!!
It isn't "off topic:" the Federal Reserve is run by the same treasonous faction that funded Hitler from Sullivan and Cromwell...Dulles Brothers, Bush, Nixon, Rockefeller...the same crew which "reversed" EO11,110 and put the pope's bankers back in charge of the money, and sent us to die for the slave aristocracy in Vietnam. Look at the Big Picture...Follow the money.

The "business" of America is Fascism: papal Fifth Column, Nazi-backing, Kennedy-killing, 9-11-committing...and National Debt-running-up and inflating the money-supply to destroy the Middle Class fascism.

"Warring against [the principles] of the people,... there is no length to which [the delusion of the people] may not be pushed by a party in possession of the revenues and the legal authorities of the United States, for a short time indeed, but yet long enough to admit much particular mischief. There is no event, therefore, however atrocious which may not be expected." --Thomas Jefferson to Samuel Smith, 1798. (*) ME 10:56

[Tokenconservative]

It isn't "off topic:" the Federal Reserve is run by the same treasonous faction that funded Hitler from Sullivan and Cromwell...Dulles Brothers, Bush, Nixon, Rockefeller...the same crew which "reversed" EO11,110 and put the pope's bankers back in charge of the money, and sent us to die for the slave aristocracy in Vietnam. Look at the Big Picture...Follow the money.

The "business" of America is Fascism: papal Fifth Column, Nazi-backing, Kennedy-killing, 9-11-committing...and National Debt-running-up and inflating the money-supply to destroy the Middle Class fascism.

"Warring against [the principles] of the people,... there is no length to which [the delusion of the people] may not be pushed by a party in possession of the revenues and the legal authorities of the United States, for a short time indeed, but yet long enough to admit much particular mischief. There is no event, therefore, however atrocious which may not be expected." --Thomas Jefferson to Samuel Smith, 1798. (*) ME 10:56

But let's not sell the Ancients, Grays, and Underdwellers short!

And the Atlanteans...at the South Pole!

Tokie

[KoihimeNakamura]

"Extraordinary claims require Extraordinary evidence."

I'm afraid I need proof for EEEVERY claim. You wouldn't want to make Moloch mad, would you?

[MilwaukeeMike]

So long as our GDP keeps increasing, debt is good. Car dealerships, if run efficiently, will never be debt free. Neither should the country.

That begs the question, how much debt can we handle? Clearly carrying too much debt is catastrophic. Well, we can look at the stock market. Suppose the Goverment is being entirely wasteful with the money, and blows every dime. So what? All of that money is going to end up in the hands of people and corporations who will use it more wisely. So long as the stock market continues to generate good returns, the money is being used well, even if that first usage was a bit irregular.

This is not my argument, it is Kenneth Fisher (http://www.financial-planning.com/pubs/fp/20070501014.html)'s. I'm personally undecided on it's merits, but would enjoy reading a discussion debating it.

Isn't debt as a percentage of GDP decreasing every year though? If it is, than the debt is more of a non issue every year.

[Francesca R]

Isn't debt as a percentage of GDP decreasing every year though? If it is, than the debt is more of a non issue every year.No, it's fairly stable though http://en.wikipedia.org/wiki/Image:US_Public_debt_per_GDP_1791-2006.svg

ETA: Well not "stable" particularly. 65% is not a "worrying" number though. Many nations have a higher public debt ratio than that.

[Tokenconservative]

So the question posed in the OP remains: why no wolf at the door?

Given, the alarmist, left-advocacy media, for political reasons is CLAIMING that the wolf is very much beyond the door and has already eviscerated us and is dining on our entrails, it's just that, dammit, the economy keeps on stubbornly clicking along, growing, unemployment refuses to rise to the 10%+ levels the left would like to see, productivity is up across the boards, hell, even savings, never high among Americans, is up!

Whatever are they going to DO to get a socialist elected to the White House and more socialists in the Congress?

Well, they know that perception is reality, so they have been for at leat 4 years now been working that side of the track, claiming that the economy is in the dumps, that Americans are out of work, that we are all "worried" then, "concerned" and now "frightened" about the economy...all on the way to November, 2008.

Of course, on the second Wednesday of 2008, depending upon how things go, the economy may be healed and in fact booming again.

We'll just have to wait for the overnights and see if a socialist gets into the White House and if the socialist keep a clear majority in House and Senate!

Hope and pray, folks...for ONLY if this happens will the media finally be able to tell us that the economy is doing pretty good.

Oh, and our "burgeoning" homeless problem will go away. Again. Too.

Tokie

[Francesca R]

So the question posed in the OP remains: why no wolf at the door?

Given [ . . . ]Several reasons have been pointed out in this thread why there is no "wolf" at the "door". Therefore the question posed--depending on your POV--does not remain.

The only one around here who mentions (screamingly, in almost every post) an alarmist "left-advocacy" media is Tokenconservative. He/she manufactures his/her own straw demons so that he/she can wage heroic battle against them and (since they are both imaginary and made of straw) . . . win. What a good feeling of victory that must be, over and over again. Probably like taking another hit of one's favourite drug or tipple. I am very pleased if he/she impresses him/herself in this struggle.

[Tokenconservative]

Several reasons have been pointed out in this thread why there is no "wolf" at the "door". Therefore the question posed--depending on your POV--does not remain.

The only one around here who mentions (screamingly, in almost every post) an alarmist "left-advocacy" media is Tokenconservative. He/she manufactures his/her own straw demons so that he/she can wage heroic battle against them and (since they are both imaginary and made of straw) . . . win. What a good feeling of victory that must be, over and over again. Probably like taking another hit of one's favourite drug or tipple. I am very pleased if he/she impresses him/herself in this struggle.

First, let's make easier on you/they: I'm a he...and a very manly he at that.

Now, as to the rest, you seem to be mixing your false complaints of my illogic with literary allusions. I tilt at windmills, no strawmen.

And while my hyperbole is now the stuff of legend (I am legend!) despite the hyperbolic um...hyperbole of my ah...hyperbole, it does not change the roof fact that the left-advocacy US "news" media cannot report on economic news without spinning it to the left, indicating that most Americans are unemployed, that our economy is nearing a state that will rival or best that of the Great Depression and that it's all the fault of Republicans, so if we are wise enough to put socialists in the White House and Congress, we will be back on track...after they tax us into the ground.

I've seen nothing in here to suggest otherwise.

Tokie