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Thread: Government Debt

  1. #1

    Default Government Debt

    Sometimes I feel like there aren't any real humans in the US, just ostriches and unicorns. At least lately the MSM is finally making a big deal out of our debt.

    This isn't just now getting serious. It has been very serious for a very long time!

    For a couple of simple math mortgage examples the author uses 3% and 6%.

    "Here’s a simplistic example: if you can afford the monthly mortgage payment to buy a $500,000 house when interest rates are 3%, that same monthly payment will only buy a $250,000 house when rates rise to 6%."

    I have never had a mortgage rate as low as 6%. Thank God I'm debt free. My last mortgage rate was well over 6%. Interest rates in the 80's were in the teens!

    https://www.zerohedge.com/news/2018-...cial-reckoning
    “The U.S. Dollar is just an unsecured liability of a bankrupt government.”-- Doug Casey, Casey Research
    Inflation--1963--I pushed a lawnmower a mile from home to mow a one acre yard for $3.00. Today a waitress would be offended for a $3.00 tip.

  2. #2

    Default

    Ehh, the beauty of it is that debt doesn't matter, it's not just the U.S. doing it, everybody's doing it, the public does it, and when recession comes bankruptcy becomes popularized, and instead of HELOC commercials, and reverse mortgages, we will see lawyers who will clear your debt. It's only in the news because the repubs ain't any better than the dems when it comes to fiscal policy.

    It's hard to take a step back and think, does debt really matter?, it's the servicing of the debt through creativity, we still have negative interest rates yet. When economic times are so great (or maybe their not), and the borrowing just increases, this is how we know it's never being paid back.

  3. #3

    Default

    Quote Originally Posted by everything1 View Post
    Ehh, the beauty of it is that debt doesn't matter, it's not just the U.S. doing it, everybody's doing it, the public does it, and when recession comes bankruptcy becomes popularized, and instead of HELOC commercials, and reverse mortgages, we will see lawyers who will clear your debt. It's only in the news because the repubs ain't any better than the dems when it comes to fiscal policy.

    It's hard to take a step back and think, does debt really matter?, it's the servicing of the debt through creativity, we still have negative interest rates yet. When economic times are so great (or maybe their not), and the borrowing just increases, this is how we know it's never being paid back.
    Yep . .all the cool kids are debtors. 21st century reality is that Savers are losers. Debtors are winners. Paper debt is as unreal as paper assets.

    On a national level - Debt can be inflated away . . debt can be grown away. Either way, when the biggest bully on the block holds debt, and also the might to negotiate its creditors to "forgive" - which they can be persuaded to do so for convenience and/or for their own safety . . debt will be gone. As the world transitions to a new currency - probably one world, probably crypto/ cashless - such debt can be erased. . .or at least reset to allow the players to have another run.

    Dems come from a position that there's unlimited resources and will spend it all in 2 generations. Repubs think they are better but just spend it all a tad slower. With a debt - based system working against them, neither can really ever 'win' in the long run. The Repub idea is simply to make the run a bit longer than the Dems.

  4. #4

    Default

    Quote Originally Posted by WhackNStack View Post
    Sometimes I feel like there aren't any real humans in the US, just ostriches and unicorns. At least lately the MSM is finally making a big deal out of our debt.

    This isn't just now getting serious. It has been very serious for a very long time!

    For a couple of simple math mortgage examples the author uses 3% and 6%.

    "Here’s a simplistic example: if you can afford the monthly mortgage payment to buy a $500,000 house when interest rates are 3%, that same monthly payment will only buy a $250,000 house when rates rise to 6%."

    I have never had a mortgage rate as low as 6%. Thank God I'm debt free. My last mortgage rate was well over 6%. Interest rates in the 80's were in the teens!

    https://www.zerohedge.com/news/2018-...cial-reckoning
    Is the media really making a "big deal" out of debt or are they just using it to bash Trump. Were Hillary in office, would she be reducing debt and government spending?
    Who are the righteous?

    Those who cannot articulate the other argument do not fully understand their own.

    "Man Makes Himself"........V. Gordon Childe

    "Much can be done by wise legislation and by resolute enforcement of the law. But still much more must be done
    by steady training of the individual. in conscience and character...." .......TR The wisdom is knowing which is when...MarkPTI

    Militia

  5. #5

    Default

    Quote Originally Posted by everything1 View Post
    Ehh, the beauty of it is that debt doesn't matter, it's not just the U.S. doing it, everybody's doing it, the public does it, and when recession comes bankruptcy becomes popularized, and instead of HELOC commercials, and reverse mortgages, we will see lawyers who will clear your debt. It's only in the news because the repubs ain't any better than the dems when it comes to fiscal policy.

    It's hard to take a step back and think, does debt really matter?, it's the servicing of the debt through creativity, we still have negative interest rates yet. When economic times are so great (or maybe their not), and the borrowing just increases, this is how we know it's never being paid back.

    Perhaps, but had the US not had any "current" debt (to take a modern extreme view of this), what government expenditures would we now be taking - what greater latitudes/options would we have?

    And, when the "world" is forced to "clear" its debts (default), what will our lives be like as this happens? How prepared are we for this?
    Who are the righteous?

    Those who cannot articulate the other argument do not fully understand their own.

    "Man Makes Himself"........V. Gordon Childe

    "Much can be done by wise legislation and by resolute enforcement of the law. But still much more must be done
    by steady training of the individual. in conscience and character...." .......TR The wisdom is knowing which is when...MarkPTI

    Militia

  6. #6

    Default

    Quote Originally Posted by Markpti View Post
    Perhaps, but had the US not had any "current" debt (to take a modern extreme view of this), what government expenditures would we now be taking - what greater latitudes/options would we have?

    And, when the "world" is forced to "clear" its debts (default), what will our lives be like as this happens? How prepared are we for this?
    To clean the slate without repercussions is impossible, the whole financial Hokuspokus would collapse, the system is interdependent and that is the problem.
    The only way out is to tackle the problem with multiple fangs and even that is not an easy game.
    The main problem is that MORE debt is needed to keep the whole circus running. which under the circumstances ( because at the same time old debts are due and to be refinanced ) that will push up the rent of money ( interest rates).
    This in its turn will have an influence on everything which was thriving on low interest rates, buzzloans, mortgages, you name it, thus slow down investments and consumption.

    When the PTB are unwilling to let the interest rates rise, and the purchasing value of the currency diminishes is thought to fall, currencies will seek its own value channels.
    Actually it is not very clear which will be those channels, but it is clear that "money" will flee to the hills.
    From my name one can see what i think to be my hill and others might have another one, but it is clear that because we KNOW that MORE debt is to be contracted, the continuation of the debtstory will have consequences, either visible ones or hidden ones which suddenly will become visible.

    Golditiki2+++

  7. #7

    Default

    Quote Originally Posted by golditiki2 View Post
    To clean the slate without repercussions is impossible, the whole financial Hokuspokus would collapse, the system is interdependent and that is the problem.
    The only way out is to tackle the problem with multiple fangs and even that is not an easy game.
    The main problem is that MORE debt is needed to keep the whole circus running. which under the circumstances ( because at the same time old debts are due and to be refinanced ) that will push up the rent of money ( interest rates).
    This in its turn will have an influence on everything which was thriving on low interest rates, buzzloans, mortgages, you name it, thus slow down investments and consumption.

    When the PTB are unwilling to let the interest rates rise, and the purchasing value of the currency diminishes is thought to fall, currencies will seek its own value channels.
    Actually it is not very clear which will be those channels, but it is clear that "money" will flee to the hills.
    From my name one can see what i think to be my hill and others might have another one, but it is clear that because we KNOW that MORE debt is to be contracted, the continuation of the debtstory will have consequences, either visible ones or hidden ones which suddenly will become visible.

    Golditiki2+++
    Agreed. Without the debt based/fueled market, innovation would have been retarded (slowed). Science is science so so many advances we have (now) would not (yet) exist but eventually would come to be. The benefits and negatives of all that would not yet exist. Commerce "values" (money and purchasing power) would be adjusted to suit. People's expectations would be "adjusted". Our "life-style" bubble would not be "so blown up".

    We'd all have the same musts, needs and wants but scaled down expectations and the need for each individual to be responsible for his/her well being would be more accountable. Risk of an Armageddon level disruption would be less - I think.
    Who are the righteous?

    Those who cannot articulate the other argument do not fully understand their own.

    "Man Makes Himself"........V. Gordon Childe

    "Much can be done by wise legislation and by resolute enforcement of the law. But still much more must be done
    by steady training of the individual. in conscience and character...." .......TR The wisdom is knowing which is when...MarkPTI

    Militia

  8. #8

    Default

    Quote Originally Posted by Markpti View Post
    Is the media really making a "big deal" out of debt or are they just using it to bash Trump. Were Hillary in office, would she be reducing debt and government spending?
    She'd be receiving media awards for fighting governmental corruption too.

  9. #9

    Default

    Quote Originally Posted by AnotherDave View Post
    She'd be receiving media awards for fighting governmental corruption too.
    Kind of like Hollywood giving Oscar awards to itself?
    Who are the righteous?

    Those who cannot articulate the other argument do not fully understand their own.

    "Man Makes Himself"........V. Gordon Childe

    "Much can be done by wise legislation and by resolute enforcement of the law. But still much more must be done
    by steady training of the individual. in conscience and character...." .......TR The wisdom is knowing which is when...MarkPTI

    Militia

  10. #10

    Default

    Quote Originally Posted by Markpti View Post
    Kind of like Hollywood giving Oscar awards to itself?
    Kind of like Hollywood giving itself good citizenship awards, and the President bundles of cash, so they can both preach to us about our morals.

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