Jump to content
House Price Crash Forum
Sign in to follow this  
interestrateripoff

Us Debt Hitting The Exponential Function?

Recommended Posts

http://www.zerohedge.com/news/2013-10-22/another-one-trillion-dollars-1000000000000-debt

Did you know that the U.S. national debt has increased by more than a trillion dollars in just over 12 months? On September 30th, 2012 the U.S. national debt was sitting at $16,066,241,407,385.89. Today, it is up to $17,075,590,107,963.57. These numbers come directly from official U.S. government websites and can easily be verified. For a long time the national debt was stuck at just less than 16.7 trillion dollars because of the debt ceiling fight, but now that the debt ceiling crisis has been delayed for a few months the national debt is soaring once again. In fact, just one day after the deal in Congress was reached, the U.S. national debt rose by an astounding 328 billion dollars. In the blink of an eye we shattered the 17 trillion dollar mark with no end in sight. We are stealing about $100,000,000 from our children and our grandchildren every single hour of every single day. This goes on 24 hours a day, month after month, year after year without any interruption.

Over the past five years, the U.S. government has been on the greatest debt binge in history. Unfortunately, most Americans don't realize just how bad things have gotten because the true budget deficit numbers are not reported on the news. The following is where the U.S. national debt has been on September 30th during the five years previous to this one...

09/30/2012: $16,066,241,407,385.89

09/30/2011: $14,790,340,328,557.15

09/30/2010: $13,561,623,030,891.79

09/30/2009: $ 11,909,829,003,511.75

09/30/2008: $10,024,724,896,912.49

The U.S. national debt is now 37 times larger than it was 40 years ago, and we are on pace to accumulate more new debt under the 8 years of the Obama administration than we did under all of the other presidents in U.S. history combined.

..

Sometimes we forget just how much money a trillion dollars is. In a previous article, I included some illustrations that I believe are helpful...

-If you were alive when Jesus Christ was born and you spent one million dollars every single day since that point, you still would not have spent one trillion dollars by now.

-If right this moment you went out and started spending one dollar every single second, it would take you more than 31,000 years to spend one trillion dollars.

Is this the new target for each president to accumulate more debt than all the previous ones?

Clearly the author misses the point trillions are becoming the norm now, it's not real money....

Share this post


Link to post
Share on other sites

http://www.zerohedge.com/news/2013-10-22/another-one-trillion-dollars-1000000000000-debt

Is this the new target for each president to accumulate more debt than all the previous ones?

Clearly the author misses the point trillions are becoming the norm now, it's not real money....

On the Marr show on Sunday Andrew interviewed the US ambassador where Marr claimed the US debt was increasing by a couple of million a day (which Marr found a huge figure). Lucky he didn't know the real figure or he would have had a stroke!

Share this post


Link to post
Share on other sites

On the Marr show on Sunday Andrew interviewed the US ambassador where Marr claimed the US debt was increasing by a couple of million a day (which Marr found a huge figure). Lucky he didn't know the real figure or he would have had a stroke!

It's a trillion divided by 365. What does that come to?

Share this post


Link to post
Share on other sites

It reminds me of this

image001.jpg

If you look at this:

http://www.usdebtclock.org/

US TOTAL DEBT ( the national debt is a bit smaller ).

Total debt per familly $751,000 ( and rising ).

Savings per familly $6550

US total interest approx $2.8 trillion

Maybe it's just me....but looking at that...the U.S. has some money worries.

Edited by TheCountOfNowhere

Share this post


Link to post
Share on other sites

It's a trillion divided by 365. What does that come to?

2.7 billion - give or take a few million - I think. I tried to work out the total US debt as a figure per head of population recently - the figures become mind boggling after a while.

Edited by bingobob

Share this post


Link to post
Share on other sites

That's just the national debt.

Indeed. Hidden on that page is the total personal debt (mortgages, student loans, credit cards etc.) and that's just over $16tn as well.

Share this post


Link to post
Share on other sites

It reminds me of this

image001.jpg

If you look at this:

http://www.usdebtclock.org/

US TOTAL DEBT ( the national debt is a bit smaller ).

Total debt per familly $751,000 ( and rising ).

Savings per familly $6550

US total interest approx $2.8 trillion

Maybe it's just me....but looking at that...the U.S. has some money worries.

Really?

The figures at the top suggest US debt up around 70% in 5 years, which is the same time scale as the weimar one which went up somewhat more than 70%.

Makes no sense to compare Weimar and US even if the figures were remotely similar anyway. Weimar inflation came about due to a huge foreign currency reparation debt following the war. If you try and print money to pay a foreign currency debt your exchange rate weakens so the debt grows and so it is a vicious circle. Much the same happened in zimbabwe more recently.

Conversely US debt is USD.

Share this post


Link to post
Share on other sites

Really?

The figures at the top suggest US debt up around 70% in 5 years, which is the same time scale as the weimar one which went up somewhat more than 70%.

Makes no sense to compare Weimar and US even if the figures were remotely similar anyway. Weimar inflation came about due to a huge foreign currency reparation debt following the war. If you try and print money to pay a foreign currency debt your exchange rate weakens so the debt grows and so it is a vicious circle. Much the same happened in zimbabwe more recently.

Conversely US debt is USD.

US DEBT Held by foreign investors £6 TRILLION.

Any thoughts on the difference on payments on that kind of debt and repatriation payments.

The point I am trying to make is that the U.S. debt looks frighteningly large and one wonders just how long they will/can keep growing it before some one blinks.

Share this post


Link to post
Share on other sites

US DEBT Held by foreign investors £6 TRILLION.

Any thoughts on the difference on payments on that kind of debt and repatriation payments.

The point I am trying to make is that the U.S. debt looks frighteningly large and one wonders just how long they will/can keep growing it before some one blinks.

It doesnt matter who holds it or how large it is relative to weimar reparation debts or Zimbabwe IMF loans, the only thing that matters is the currency it is denominated in. US could print 17 trillion tomorrow and instantly have no debt. Weimar and Zimbabwe couldn't because as they print their own currency it weakens so buys less of the currency it is trying to pay back so the debt is always moving out of reach, hence the exponential nature of the graph you posted. This would not happen for US (or UK anyone else whose debt is in their own currency).

Based on the fact the US can always (well unless some lunatic tea party candidates choose not too) pay all its debt, any amount doesn't seem frighteningly large really. PeoPke are aware of this hence they keep buying it.

Share this post


Link to post
Share on other sites

It doesnt matter who holds it or how large it is relative to weimar reparation debts or Zimbabwe IMF loans, the only thing that matters is the currency it is denominated in. US could print 17 trillion tomorrow and instantly have no debt. Weimar and Zimbabwe couldn't because as they print their own currency it weakens so buys less of the currency it is trying to pay back so the debt is always moving out of reach, hence the exponential nature of the graph you posted. This would not happen for US (or UK anyone else whose debt is in their own currency).

Based on the fact the US can always (well unless some lunatic tea party candidates choose not too) pay all its debt, any amount doesn't seem frighteningly large really. PeoPke are aware of this hence they keep buying it.

Wrong. Sovereigns can run fiscal and current account deficits simultaneously only for as long as they can maintain confidence in their currency. The US is obliged to run a current account deficit because the dollar is the de facto global reserve currency. If they continue to abuse this privilege the dollar will lose its status.

Share this post


Link to post
Share on other sites

US could print 17 trillion tomorrow and instantly have no debt.

Except there would be consequences; For every $1000 of debt is someone else's credit, although some of it could be restructured. You've got to look at the US overall wealth position as well, although a lot of it dependent upon house prices and so on. Someone else might make a guess on US total wealth - debt.

How's TTSnr doing these days?

http://www.dailymail.co.uk/property/article-1213351/Its-crime---I-make-killing-planning-deal-says-gangster-film-star.html

And 2 trillion of that US debt is possibly QE sloshing around in the banks?

"Corporations have great balance sheets and just don't trust the economic recovery," said Ethan Harris, the co-head of global economics research at Bank of America-Merrill Lynch.

In fact, while the Fed has pumped about $2.8 trillion into the financial system through nearly five years of asset buying.

Bank excess reserves deposited with the New York Fed have mushroomed from less than $2 billion before the financial crisis to $2.17 trillion today. In essence, roughly two-thirds of the money the Fed pumped into the banking system never left the building.

Share this post


Link to post
Share on other sites

Except there would be consequences; For every $1000 of debt is someone else's credit, although some of it could be restructured. You've got to look at the US overall wealth position as well, although a lot of it dependent upon house prices and so on. Someone else might make a guess on US total wealth - debt.

How's TTSnr doing these days?

http://www.dailymail.co.uk/property/article-1213351/Its-crime---I-make-killing-planning-deal-says-gangster-film-star.html

And 2 trillion of that US debt is possibly QE sloshing around in the banks?

It certainly would be interesting. The 17 triliin they printed would be debt free I guess so you would suddenly move from a debt based money system to one that wasn't. The creditors would be being paid though as the debt is being paid off by money printing.

I've never seen Terry Turbo with hair. Only knew of him as the bald One Nation promoter.

Regarding the bottom quote that's very sloppy journalism as excess reserves cannot really leave the building as a reserve is a balance at the central bank. No matter what the holders buy with it ultimately ends the day at in someone's account as an (excess) reserve.

Share this post


Link to post
Share on other sites

USD is the global reserve currency

The clue is in the title.

Comparing it to Weimar who were printing domestic currency to repay foreign obligations is nonsense.

The global reserve currency underpins the totality of global trade, including forming the reserves of surplus nations, comparing it to a single country currency (as the Zero Hedge gold activists are wont to do) is simply ridiculous.

Share this post


Link to post
Share on other sites

USD is the global reserve currency

The clue is in the title.

Comparing it to Weimar who were printing domestic currency to repay foreign obligations is nonsense.

The global reserve currency underpins the totality of global trade, including forming the reserves of surplus nations, comparing it to a single country currency (as the Zero Hedge gold activists are wont to do) is simply ridiculous.

And if it loses that status? No currency holds the title forever.

Share this post


Link to post
Share on other sites

And if it loses that status? No currency holds the title forever.

Yep, USD is CURRENTLY the MAIN currency used for exchange and store of wealth.

Reserve currencies can be a mix (62% dollar, 24% Euro, 4% GBP, 4% Yen).

That mix can change over time. The German mark was nearly 16% in 1995.

At some point the USD will slip below a critical percentage of reserve currency where it's specialness is no longer relevant and I guess then it falls fast.

Devaluing the USD through QE and other things will have an effect. hard to predict though.

GBP was the most important reserve currency before the USD.

Before that, different coins - Thaler (where the word 'dollar' comes from) etc.

I guess that trust was important in selecting the reserve currency. I don't trust the USD / GBP as much as I used to. Other people may share my views.

It's the overall weighted aggregate of these views that make the market.

Share this post


Link to post
Share on other sites

Figures on government spending and debt (last six digits are eliminated).

Total public debt subject to limit Nov 20 17,925,171

Statutory debt limit suspended

Total public debt outstanding Nov 20 17,966,390

Operating balance Nov 20 80,404

Interest fiscal year 2015 thru Oct 21,130

Interest same period pvs fiscal year 20,185

Deficit fiscal year 2015 thru Oct 121,713

Deficit same period pvs fiscal year 90,584

Receipts fiscal year 2015 thru Oct 212,719

Receipts same period pvs fiscal year 198,927

Outlays fiscal year 2015 thru Oct 334,432

Outlays same period pvs fiscal year 289,511

Gold assets in Oct 11,041

https://uk.finance.yahoo.com/news/figures-government-spending-debt-214153215.html

Edited by rollover

Share this post


Link to post
Share on other sites

Yep, USD is CURRENTLY the MAIN currency used for exchange and store of wealth.

Reserve currencies can be a mix (62% dollar, 24% Euro, 4% GBP, 4% Yen).

At some point the USD will slip below a critical percentage of reserve currency where it's specialness is no longer relevant and I guess then it falls fast.

I guess that trust was important in selecting the reserve currency. I don't trust the USD / GBP as much as I used to. Other people may share my views.

It's the overall weighted aggregate of these views that make the market.

But if you'd have to place a bet on whether the dollar or the euro was going to be here longer.....

I can see a very probable future in which the euro collapses, dollar resurges in importance, and only when china/russia actually sort out their political systems (or the rouble/reM goes gold backed) will the dollar collapse. That could be easi;y 10+ years away...

Share this post


Link to post
Share on other sites

But if you'd have to place a bet on whether the dollar or the euro was going to be here longer.....

I can see a very probable future in which the euro collapses, dollar resurges in importance, and only when china/russia actually sort out their political systems (or the rouble/reM goes gold backed) will the dollar collapse. That could be easi;y 10+ years away...

Russia stockpiling loads of gold, although some say the main beneficiaries being Putin allies in the gold sector. Yes US dollar is the world reserve currency, but I remain open to it being challenged. Although Russia has would need so many reforms, cultural changes (corruption) and there is so little market trust they in honourable capitalist traditions, with none of the foundations for it either - yet US (and UK) has moved far away from that too with financial repression of younger people (imo).

$142.5 Bn Russia on that graphic to UK's $142.3 Bn....

Friday, 21 November 2014

GOLDEN ROUBLE

[..] Putin is rumoured to be preparing a major programme to reduce corruption and improve economic efficiency, but even if this is successful, it is going to take time, and it can’t be expected to fully offset the effect of sanctions

In the same way, the Russian state today has small liabilities, perhaps $200 billion, compared to the assets it possesses, which easily amount to $10 trillion. The state, after all, owns almost everything in 11 time zones, which it acquired in the 1917 revolution. [..]This credibility is also reinforced by the Russian economy’s relatively low debt.

[..] In an extreme but hardly impossible scenario, the dollar could lose reserve status entirely, something that would be devastating for the US economy.

[..] Given these achievements, Putin is not a leader to be taken lightly and we should pay attention when he says it it his desire to end the ‘dictatorship of the dollar’, as he did just this week. [11] Perhaps he will indeed play the gold card he has hidden up his sleeve and thus kill two birds with one stone: shore up the rouble and Russian economy on the one hand; dethrone the dollar on the other.

http://davidstockmanscontracorner.com/as-the-sanctions-war-heats-up-will-putin-play-his-gold-card/

Share this post


Link to post
Share on other sites
Did you know that the U.S. national debt

Global reserve currency

One Day Kids, All This Debt Will Be YOURS!

Along with the infrastructure, schools, education, roads, hospitals, houses et al

You can default the debt - theyll still exist. Clever innit!

Or to coin a phrase - houses are real, debt is a matter of choice

Edited by R K

Share this post


Link to post
Share on other sites

If China is to export goods to the US, it has to be paid in dollars.

There is no alternative to the dollar in terms of reserve currency.

The irony is that the US becoming self sufficient probably represents the largest chance of the dollar losing reserve currency status. That's because if they become self sufficient in oil (not far off) and that oil is used to make them self sufficient in tat, they won't need to export dollars anymore. In this scenario the Chinese are going to have to massively raise their own consumption. This won't happen (and in fact the government in China have been trying it) because the people in China who have got the money want to keep it, rather than dishing it out to the proles (a bit like here).

The relationship is symbiotic, and if one is doomed so is the other.

That said, the mechanism for accounting for the relationship/imbalance, is clearly not going to last in its current form, what is currently happening (expansion of debt indefinitely) cannot happen forever. Since there will be little short term political will to fix the problem, the likelyhood is that it will continue until at some point things get crazy.

IMO anyway.

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • The Prime Minister stated that there were three Brexit options available to the UK:   224 members have voted

    1. 1. Which of the Prime Minister's options would you choose?


      • Leave with the negotiated deal
      • Remain
      • Leave with no deal

    Please sign in or register to vote in this poll. View topic


×

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.