How long until US default?

[pedrocon]

Interesting comments especially the one about tariffs, and the other foreign currencies devaluing their currencies to keep up with the US devaluation.
I think we can all agree that no matter the government will not cut costs. They will either increase revenue by tariff ( which would be an interesting contradiction since we’ve been pushing free trade for decades) or they will inflate. My guess is we are about to become more like India (BIG, unstable, weak currency, powerful country, but politically/economically volatile).

I could see there being a small brain drain here as people move away for opportunities elsewhere.

[underdose]

“On the one hand, debt as a pct of GDP is large but not excessive by either international standards or by historical standards.”

alarmclock, in your journeys down the rabbit hole have you come across shadowstats.com? Another user forum turned me onto it, and it is quite informative. Check out this article:

http://www.shadowstats.com/article/292

A little more than halfway down the page is a chart that shows US debt as calculated according to generally accepted accounting principles (which should be trusted more than the govt. propag… er, um, statistics) vs. GDP next to the rest of the world’s debt vs. the rest of world’s GDP. By international standards, we’re the most insolvent, negative net worth debtor in all of history. He also points out that if the govt. seized 100% of all salary and corporate income this year, according to GAAP we would still be operating at a deficit. Yikes!

Frankly, I see little difference between debasing the currency and defaulting. Inflation is a sneaky way to default, but it is defaulting in spirit none-the-less. So how soon? The government is already defaulting, and at an accelerating pace as they ramp up the bailout machine. China has already called for a new reserve currency in response to this slow default. The catastrophic “default” that you fear will be a massive flight from the dollar, which China could easily instigate. Maybe the floor will drop tomorrow, maybe many years from now. But I can not allay your fears because I too fear it could be very soon.

[underdose]

“On the one hand, debt as a pct of GDP is large but not excessive by either international standards or by historical standards.”

alarmclock, in your journeys down the rabbit hole have you come across shadowstats.com? Another user forum turned me onto it, and it is quite informative. Check out this article:

http://www.shadowstats.com/article/292

A little more than halfway down the page is a chart that shows US debt as calculated according to generally accepted accounting principles (which should be trusted more than the govt. propag… er, um, statistics) vs. GDP next to the rest of the world’s debt vs. the rest of world’s GDP. By international standards, we’re the most insolvent, negative net worth debtor in all of history. He also points out that if the govt. seized 100% of all salary and corporate income this year, according to GAAP we would still be operating at a deficit. Yikes!

Frankly, I see little difference between debasing the currency and defaulting. Inflation is a sneaky way to default, but it is defaulting in spirit none-the-less. So how soon? The government is already defaulting, and at an accelerating pace as they ramp up the bailout machine. China has already called for a new reserve currency in response to this slow default. The catastrophic “default” that you fear will be a massive flight from the dollar, which China could easily instigate. Maybe the floor will drop tomorrow, maybe many years from now. But I can not allay your fears because I too fear it could be very soon.

[underdose]

“On the one hand, debt as a pct of GDP is large but not excessive by either international standards or by historical standards.”

alarmclock, in your journeys down the rabbit hole have you come across shadowstats.com? Another user forum turned me onto it, and it is quite informative. Check out this article:

http://www.shadowstats.com/article/292

A little more than halfway down the page is a chart that shows US debt as calculated according to generally accepted accounting principles (which should be trusted more than the govt. propag… er, um, statistics) vs. GDP next to the rest of the world’s debt vs. the rest of world’s GDP. By international standards, we’re the most insolvent, negative net worth debtor in all of history. He also points out that if the govt. seized 100% of all salary and corporate income this year, according to GAAP we would still be operating at a deficit. Yikes!

Frankly, I see little difference between debasing the currency and defaulting. Inflation is a sneaky way to default, but it is defaulting in spirit none-the-less. So how soon? The government is already defaulting, and at an accelerating pace as they ramp up the bailout machine. China has already called for a new reserve currency in response to this slow default. The catastrophic “default” that you fear will be a massive flight from the dollar, which China could easily instigate. Maybe the floor will drop tomorrow, maybe many years from now. But I can not allay your fears because I too fear it could be very soon.

[underdose]

“On the one hand, debt as a pct of GDP is large but not excessive by either international standards or by historical standards.”

alarmclock, in your journeys down the rabbit hole have you come across shadowstats.com? Another user forum turned me onto it, and it is quite informative. Check out this article:

http://www.shadowstats.com/article/292

A little more than halfway down the page is a chart that shows US debt as calculated according to generally accepted accounting principles (which should be trusted more than the govt. propag… er, um, statistics) vs. GDP next to the rest of the world’s debt vs. the rest of world’s GDP. By international standards, we’re the most insolvent, negative net worth debtor in all of history. He also points out that if the govt. seized 100% of all salary and corporate income this year, according to GAAP we would still be operating at a deficit. Yikes!

Frankly, I see little difference between debasing the currency and defaulting. Inflation is a sneaky way to default, but it is defaulting in spirit none-the-less. So how soon? The government is already defaulting, and at an accelerating pace as they ramp up the bailout machine. China has already called for a new reserve currency in response to this slow default. The catastrophic “default” that you fear will be a massive flight from the dollar, which China could easily instigate. Maybe the floor will drop tomorrow, maybe many years from now. But I can not allay your fears because I too fear it could be very soon.

[underdose]

“On the one hand, debt as a pct of GDP is large but not excessive by either international standards or by historical standards.”

alarmclock, in your journeys down the rabbit hole have you come across shadowstats.com? Another user forum turned me onto it, and it is quite informative. Check out this article:

http://www.shadowstats.com/article/292

A little more than halfway down the page is a chart that shows US debt as calculated according to generally accepted accounting principles (which should be trusted more than the govt. propag… er, um, statistics) vs. GDP next to the rest of the world’s debt vs. the rest of world’s GDP. By international standards, we’re the most insolvent, negative net worth debtor in all of history. He also points out that if the govt. seized 100% of all salary and corporate income this year, according to GAAP we would still be operating at a deficit. Yikes!

Frankly, I see little difference between debasing the currency and defaulting. Inflation is a sneaky way to default, but it is defaulting in spirit none-the-less. So how soon? The government is already defaulting, and at an accelerating pace as they ramp up the bailout machine. China has already called for a new reserve currency in response to this slow default. The catastrophic “default” that you fear will be a massive flight from the dollar, which China could easily instigate. Maybe the floor will drop tomorrow, maybe many years from now. But I can not allay your fears because I too fear it could be very soon.

[Eugene]

A little more than halfway down the page is a chart that shows US debt as calculated according to generally accepted accounting principles (which should be trusted more than the govt. propag… er, um, statistics) vs. GDP next to the rest of the world’s debt vs. the rest of world’s GDP.

Sorry, that’s a load of B.S. They are probably counting cumulative Social Security and Medicare payments to be made over the next 100 years (indexed for inflation) and adding them together, that’s the only way to get at total obligations = 5x GDP. Sorry, that’s not debt, that’s just a big scary meaningless figure. He’s basically saying, US government is bad and evil because they dare to guarantee health insurance and medical care to retired US citizens! omg how dare they! Of course, most banana republics don’t do that, they just let their elderly fend for themselves, so they have much better obligations-to-GDP ratios. Besides, European countries have strong social security plans and accurate analysis would show high ratios there too.

[Eugene]

A little more than halfway down the page is a chart that shows US debt as calculated according to generally accepted accounting principles (which should be trusted more than the govt. propag… er, um, statistics) vs. GDP next to the rest of the world’s debt vs. the rest of world’s GDP.

Sorry, that’s a load of B.S. They are probably counting cumulative Social Security and Medicare payments to be made over the next 100 years (indexed for inflation) and adding them together, that’s the only way to get at total obligations = 5x GDP. Sorry, that’s not debt, that’s just a big scary meaningless figure. He’s basically saying, US government is bad and evil because they dare to guarantee health insurance and medical care to retired US citizens! omg how dare they! Of course, most banana republics don’t do that, they just let their elderly fend for themselves, so they have much better obligations-to-GDP ratios. Besides, European countries have strong social security plans and accurate analysis would show high ratios there too.

[Eugene]

A little more than halfway down the page is a chart that shows US debt as calculated according to generally accepted accounting principles (which should be trusted more than the govt. propag… er, um, statistics) vs. GDP next to the rest of the world’s debt vs. the rest of world’s GDP.

Sorry, that’s a load of B.S. They are probably counting cumulative Social Security and Medicare payments to be made over the next 100 years (indexed for inflation) and adding them together, that’s the only way to get at total obligations = 5x GDP. Sorry, that’s not debt, that’s just a big scary meaningless figure. He’s basically saying, US government is bad and evil because they dare to guarantee health insurance and medical care to retired US citizens! omg how dare they! Of course, most banana republics don’t do that, they just let their elderly fend for themselves, so they have much better obligations-to-GDP ratios. Besides, European countries have strong social security plans and accurate analysis would show high ratios there too.

[Eugene]

A little more than halfway down the page is a chart that shows US debt as calculated according to generally accepted accounting principles (which should be trusted more than the govt. propag… er, um, statistics) vs. GDP next to the rest of the world’s debt vs. the rest of world’s GDP.

Sorry, that’s a load of B.S. They are probably counting cumulative Social Security and Medicare payments to be made over the next 100 years (indexed for inflation) and adding them together, that’s the only way to get at total obligations = 5x GDP. Sorry, that’s not debt, that’s just a big scary meaningless figure. He’s basically saying, US government is bad and evil because they dare to guarantee health insurance and medical care to retired US citizens! omg how dare they! Of course, most banana republics don’t do that, they just let their elderly fend for themselves, so they have much better obligations-to-GDP ratios. Besides, European countries have strong social security plans and accurate analysis would show high ratios there too.

[Eugene]

A little more than halfway down the page is a chart that shows US debt as calculated according to generally accepted accounting principles (which should be trusted more than the govt. propag… er, um, statistics) vs. GDP next to the rest of the world’s debt vs. the rest of world’s GDP.

Sorry, that’s a load of B.S. They are probably counting cumulative Social Security and Medicare payments to be made over the next 100 years (indexed for inflation) and adding them together, that’s the only way to get at total obligations = 5x GDP. Sorry, that’s not debt, that’s just a big scary meaningless figure. He’s basically saying, US government is bad and evil because they dare to guarantee health insurance and medical care to retired US citizens! omg how dare they! Of course, most banana republics don’t do that, they just let their elderly fend for themselves, so they have much better obligations-to-GDP ratios. Besides, European countries have strong social security plans and accurate analysis would show high ratios there too.

[carlover]

Just another example of twisting the data to match your pre-determined result. Notice in the chart that for the US he lists total government obligations, but conveniently for the rest of the world he only lists debt. Japans debt is close to 200% of GDP, Italy’s is over 100%, funny that no one mentions those, and certainly no one is parading out comments of those countries going insolvent. Are we in a bad situation right now, YES, will the whole country collapse as a result, I’ll put my money that it won’t!

[carlover]

Just another example of twisting the data to match your pre-determined result. Notice in the chart that for the US he lists total government obligations, but conveniently for the rest of the world he only lists debt. Japans debt is close to 200% of GDP, Italy’s is over 100%, funny that no one mentions those, and certainly no one is parading out comments of those countries going insolvent. Are we in a bad situation right now, YES, will the whole country collapse as a result, I’ll put my money that it won’t!

[carlover]

Just another example of twisting the data to match your pre-determined result. Notice in the chart that for the US he lists total government obligations, but conveniently for the rest of the world he only lists debt. Japans debt is close to 200% of GDP, Italy’s is over 100%, funny that no one mentions those, and certainly no one is parading out comments of those countries going insolvent. Are we in a bad situation right now, YES, will the whole country collapse as a result, I’ll put my money that it won’t!

[carlover]

Just another example of twisting the data to match your pre-determined result. Notice in the chart that for the US he lists total government obligations, but conveniently for the rest of the world he only lists debt. Japans debt is close to 200% of GDP, Italy’s is over 100%, funny that no one mentions those, and certainly no one is parading out comments of those countries going insolvent. Are we in a bad situation right now, YES, will the whole country collapse as a result, I’ll put my money that it won’t!

[Author]

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