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Us Federal Budget Growth

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Budget years are from October-September. So budget 2011 will start next month.

2006: $2.66 trillion

2007: $2.78 trillion (4.5% growth)

2008: $2.9 trillion (4.3% growth)

2009: $3.11 trillion (7.2% growth)

2010: $3.55 trillion (14.1% growth)

2011(proposed): $3.83 trillion (7.9% growth)

Sort of interesting is the 2011 is proposed to be 280 billion higher than 2011. Well that would add 2% to the US gdp growth. And the estimates I have seen are the US gdp growth is forecast to be 2% next year.

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I am in favour of this expansion, actually I support going far larger. The reality is in this time of excess production and demand collapse, only national governments with printing presses can drive demand and get things going again.

And the bond market is agreeing with me. People are fighting with each other over who gets to buy treasuries, the 10 year treasuries are yielding just 2.5% right now! The whole curve is moving down, wtih the short term ones near 0% already.

And that is before QE 2.0 gets going. Where I have read an argument on zero hedge that as planned it could push rates on the 10 year down to near 0%.

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I am in favour of this expansion, actually I support going far larger. The reality is in this time of excess production and demand collapse, only national governments with printing presses can drive demand and get things going again.

And the bond market is agreeing with me. People are fighting with each other over who gets to buy treasuries, the 10 year treasuries are yielding just 2.5% right now! The whole curve is moving down, wtih the short term ones near 0% already.

And that is before QE 2.0 gets going. Where I have read an argument on zero hedge that as planned it could push rates on the 10 year down to near 0%.

Time will tell.

You're suggesting people will want to buy pieces of paper that yield nothing for 10 years and are redeemable at face value when the thing they are redeemed for is being printed up for free.

I'm sort of looking for the catch.

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Time will tell.

You're suggesting people will want to buy pieces of paper that yield nothing for 10 years and are redeemable at face value when the thing they are redeemed for is being printed up for free.

I'm sort of looking for the catch.

It does seem stupid in the paradigm we are used to. But the fact that it can be printed up for free gives it one immense advantage.. they can guaruntee you will get your money back. Whereas other investments might possibly yield a higher return, but otoh it might blow up and you lose everything. The only guaruntee with bank accounts is the 100k per bank. While that really helps the little guy, for the big players that doesn't give them any safety.

Also we see this currency war breaking out, nations are bidding against each other to buy up as much dollars as they can. In order to push their currency down. So far they are scared to buy into things like equity and real estate and wanting to hold treasuries.

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It does seem stupid in the paradigm we are used to. But the fact that it can be printed up for free gives it one immense advantage.. they can guaruntee you will get your money back. Whereas other investments might possibly yield a higher return, but otoh it might blow up and you lose everything. The only guaruntee with bank accounts is the 100k per bank. While that really helps the little guy, for the big players that doesn't give them any safety.

Also we see this currency war breaking out, nations are bidding against each other to buy up as much dollars as they can. In order to push their currency down. So far they are scared to buy into things like equity and real estate and wanting to hold treasuries.

But what about getting your value back?

If they print the things to infinity (and beyond), what will they be worth? What will they buy?

Land feels best to me. Naughty in the context of this site, but nice for value as they can't really counterfeit it.

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But what about getting your value back?

If they print the things to infinity (and beyond), what will they be worth? What will they buy?

Land feels best to me. Naughty in the context of this site, but nice for value as they can't really counterfeit it.

Thats why many rich foreigners buy property in London. They know it might go down some, but it is still going to be worth a lot either way. They are already rich, they are not worried about return on investment. And we have stable property rights.

Another heresy online which I've been attracted to lately is US big corporate names. HP, Intel, Coca Cola.. they aren't going anywhere. If China keeps growing fast they invest in China. If Europe rebounds and does well their Euro business does well. If inflation goes they up their prices.

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I am in favour of this expansion, actually I support going far larger. The reality is in this time of excess production and demand collapse, only national governments with printing presses can drive demand and get things going again.

And the bond market is agreeing with me. People are fighting with each other over who gets to buy treasuries, the 10 year treasuries are yielding just 2.5% right now! The whole curve is moving down, wtih the short term ones near 0% already.

And that is before QE 2.0 gets going. Where I have read an argument on zero hedge that as planned it could push rates on the 10 year down to near 0%.

History suggests otherwise, every time the printing press has been used to secure this objective it ends in hyperinflation demand destruction.

You can't print money and make people buy goods.

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Thats why many rich foreigners buy property in London. They know it might go down some, but it is still going to be worth a lot either way. They are already rich, they are not worried about return on investment. And we have stable property rights.

Another heresy online which I've been attracted to lately is US big corporate names. HP, Intel, Coca Cola.. they aren't going anywhere. If China keeps growing fast they invest in China. If Europe rebounds and does well their Euro business does well. If inflation goes they up their prices.

Once upon a time HP used to make test equipment nobody could match, now the make equipment and offer services many can match, they rely on Chinese labour and Chinese Govt assitance to make it too. Intel, more niche but there is competition, might have a stranglehold on the market, for now at least. Coca Cola - different, a brand in a different market, should last.

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Once upon a time HP used to make test equipment nobody could match, now the make equipment and offer services many can match, they rely on Chinese labour and Chinese Govt assitance to make it too. Intel, more niche but there is competition, might have a stranglehold on the market, for now at least. Coca Cola - different, a brand in a different market, should last.

Imo on some level you have to believe in the companies you invest in. I actually prefer AMD so would probably go with them. I love Coca Cola, I am always drinking their products.. I don't really like Pepsi that much so I wouldn't invest in their stock.

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History suggests otherwise, every time the printing press has been used to secure this objective it ends in hyperinflation demand destruction.

You can't print money and make people buy goods.

You can print and buy goods for people though. :D

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Quite right.. at some point the bond investors will twig on that they are guaranteed to lose their buying power by investing in bonds, and they aren't quite the safe haven they should be.

People have a twisted historical and tribal memory that investments backed by the state are somehow 'safe'.

With all the mass currency manipulation going on - the race to the bottom via currency devaluation, the exit from bonds might be the next big story.

And then there will be a wall of cash in flight to things of real value. To prevent that, countries will put up capital controls to prevent you (en masse) causing the hyper-inflation and currency destruction that this would bring.

Unless of course the countries want this to happen, so they can press the 'reset' button, wipe out their debts, introduce a new currency and we all dance off into the sunset, farting rainbows, with big smiles on our faces once again.

Interesting times ahead.. we must be near the end game soon.

Edited by sesim

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  • 246 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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