US Debt Has Exploded

[jaysabi]

First 224 years of existence: 5.674 trillion dollars
Next 8 Bush years: 4.350 trillion dollars
Next 7 Obama years: 8.126 trillion dollars

Compare what we've done in the last 15 years to what we did in the first 224 years. We've more than tripled in the last 15 years what it took 224 years to accumulate in debt.

To be lazy and use stereotypes, democrats spend too much and republicans tax too little. The truth is that both parties spend too much and tax too little. The current war spending is not sustainable. The current tax rates are not sustainable. Social Security and Medicaid are about to explode in expenditures. You simply cannot cut this level of debt by only cutting spending or only raising taxes. It will take substantial efforts on both ends to put things in order, and then it will take disciplined restraint and political will to stay on course over several decades to begin to fix this process.

Frankly, our politicians are not up to the challenge. Their incentive is re-election every 2 or 4 years, and this type of outlook is incompatible with the long-term approach necessary to fix what an utter mess the national finances have become.

[Amph]

this should encourage more, the people to invest in bitcoin, and help growing an alternative way to the plague that was/still is our conventional money system

trusting fiat at present is more dangerous than investing in bitcoin, numerous case of money lost due to banks playing with people money

there was a case of a bank(here) suggesting to an old man to invest in a low risk investment that then is become a heavy risk one, and he lost 100k in euro, he commited suicide by hanging

[tyz]

Not only the debt of the United States. Look around the world. The debts are exploding everywhere. Europe, China, Japan, Russia, Latin America, even in the Arabic states like Saudi Arabia.
There is no way out of this development.

[callynyan]

Buy bitcoin and gold.
They are the best vaults to survive the fallout.
People that did not buy bitcoin or gold will turn into ghouls!

[spazzdla]

Buy bitcoin and gold.
They are the best vaults to survive the fallout.
People that did not buy bitcoin or gold will turn into ghouls!

The pigs will come for your money, hide it.

[OROBTC]

...

jaysabi

And those debt numbers are JUST the officially acknowledged US National Debt.  Depending on whose numbers you believe, those debts (inc. unfunded liabilities) could be from $80 trillion to $220 trillion.

If the FED raises rates this month, the interest rates will cause our debts to rise even faster.  Ugh.

*   *   *

callynyan

I don't about non-holders of BTC and gold becoming GHOULS, but point taken.

Both BTC and gold are excellent diversification vs. .gov malfeasance.




EDIT: You got it spazzdla, they are coming for whatever "Easy Money" they can steal.  I cashed in my IRA (a USA pension scheme) in 2008.

[virtualx]

Not only the debt of the United States. Look around the world. The debts are exploding everywhere. Europe, China, Japan, Russia, Latin America, even in the Arabic states like Saudi Arabia.
There is no way out of this development.

Debts everywhere. Sustainable or house of cards?

[Yakamoto]

Not only the debt of the United States. Look around the world. The debts are exploding everywhere. Europe, China, Japan, Russia, Latin America, even in the Arabic states like Saudi Arabia.
There is no way out of this development.

Debts everywhere. Sustainable or house of cards?

House of cards.

Unless you are interested in having a cup of coffee costing $30 in the future and realizing that any pay you get now will have very little value in the future, there is no way that countries can maintain a level of sustainable debt.

There is no way it can continue to be propped up for lengthy periods of time.

When a piece of paper has given value that only shrinks over time, there will eventually be many people who will question why it is worth doing anything now.

[Chronikka]

The shear numbers are of course increasing. But that has more to do with currency inflation than actually borrowing more money. Every major country on the planet has some debt, just like most people in this world have some financial debt. Its life.

IMO what matters is not so much the total debt a country has, but the ratio of debt to GDP. That gives you an idea of how easily a country would actually be able to pay off its debt. In the case of the US, the ratio is estimated between 104-105% which is to say its essentially a 1:1 ratio. The GDP in the United States is about equal to its debt. That's pretty common and not really all that alarming. The ratio for the entire eurozone is about ~94% with some countries well above 100%

Is debt high in the US? Yes certainly. But is it so bad that we need to stop everything and fix it now? No its not. By comparison, Greece who almost defaulted earlier this year, is somewhere north of 180%

http://www.debtclocks.eu/

[yvv]

Not only the debt of the United States. Look around the world. The debts are exploding everywhere. Europe, China, Japan, Russia, Latin America, even in the Arabic states like Saudi Arabia.
There is no way out of this development.

This is just not true. National debt of Russia is 15% of GDP, national debt of Saudi Arabia is 8% of GDP.

[Monnt]

The US economy no doubt will collapse very soon, it'll probably collapse instantly if China decides to sell all its US bonds on the forex markets.

[Chronikka]

Not only the debt of the United States. Look around the world. The debts are exploding everywhere. Europe, China, Japan, Russia, Latin America, even in the Arabic states like Saudi Arabia.
There is no way out of this development.

This is just not true. National debt of Russia is 15% of GDP, national debt of Saudi Arabia is 8% of GDP.

Both of those countries you just mentioned also have rapidly depleting cash reserves, mostly thanks to the oil crash. They might not have as much debt but they're spending cash rapidly to prop up their economies.

[yvv]

Not only the debt of the United States. Look around the world. The debts are exploding everywhere. Europe, China, Japan, Russia, Latin America, even in the Arabic states like Saudi Arabia.
There is no way out of this development.

I'll just leave this here

https://en.wikipedia.org/wiki/File:Government_debt_gdp.jpg

[yvv]

Not only the debt of the United States. Look around the world. The debts are exploding everywhere. Europe, China, Japan, Russia, Latin America, even in the Arabic states like Saudi Arabia.
There is no way out of this development.

This is just not true. National debt of Russia is 15% of GDP, national debt of Saudi Arabia is 8% of GDP.

Both of those countries you just mentioned also have rapidly depleting cash reserves, mostly thanks to the oil crash. They might not have as much debt but they're spending cash rapidly to prop up their economies.

http://www.cbr.ru/hd_base/default.aspx?Prtid=mrrf_m

The leftmost column is total reserves of Russian Central Bank. I don't see a rapid decrease there.
 

[Pab]

Yes debt  everywhere,but if to think about all that financial instruments based on debts,derivatives,thatwe even dont know how many trilionsit is.NowEBC QE is not working,no landingin Europe,anysigne of inlation

So if Euro will fail,many economist is predicting that,whatwill happen with all that euro debt derivatives
Will be massive sell of before,total crash,look on stock today,all in reds,over2%on all major indexes
only btc express is moving up.What is going on,itis not fear before Fed

[Chronikka]

Not only the debt of the United States. Look around the world. The debts are exploding everywhere. Europe, China, Japan, Russia, Latin America, even in the Arabic states like Saudi Arabia.
There is no way out of this development.

This is just not true. National debt of Russia is 15% of GDP, national debt of Saudi Arabia is 8% of GDP.

Both of those countries you just mentioned also have rapidly depleting cash reserves, mostly thanks to the oil crash. They might not have as much debt but they're spending cash rapidly to prop up their economies.

http://www.cbr.ru/hd_base/default.aspx?Prtid=mrrf_m

The leftmost column is total reserves of Russian Central Bank. I don't see a rapid decrease there.
 

The link you posted shows a drop in international reserves of more than 12% in the last year alone. Thats a pretty significant amount of money to me (More than $50 billion). Here is the same link in English for anybody that doesn't read Russian:

http://www.cbr.ru/eng/hd_base/?Prtid=mrrf_m

[ridery99]

Not only the debt of the United States. Look around the world. The debts are exploding everywhere. Europe, China, Japan, Russia, Latin America, even in the Arabic states like Saudi Arabia.
There is no way out of this development.

It's just a side effect of printing money, relax 

[jaysabi]

...

jaysabi

And those debt numbers are JUST the officially acknowledged US National Debt.  Depending on whose numbers you believe, those debts (inc. unfunded liabilities) could be from $80 trillion to $220 trillion.

If the FED raises rates this month, the interest rates will cause our debts to rise even faster.  Ugh.

Well, it's what the debt actually is at present. Unfunded liabilities are not current debts, they are future debts. The law mandating their payment could change, or the demographics underlying their calculation could change before they actually need to be paid, or revenue could more than make up the difference by the time they are incurred in which case they wouldn't add to the debt at all. In any case, I didn't include them in my post because they're speculative. The debt numbers posted are the Treasury's numbers of debt currently incurred, but you're right that you shouldn't ignore the looming crisis unfunded liabilities pose, which is exactly what every politician is presently doing.

[Pab]

Debt economy crash begin

http://carlicahn.com/

The Securities and Exchange Commission agreed today to issue a proposed rule governing ETFs' use of derivatives -- a type of unregulated trading contract that's used to bet on an underlying asset such as a stock index or commodity. Such products include so-called leveraged ETFs, which use derivatives to multiply returns. One example is the Direxion Daily Emerging Markets Bull 3x Shares, an ETF that employs derivative contracts with such Wall Street firms as Citigroup (C - Get Report) , Deutsche Bank, and Bank of America Merrill Lynch (BAC - Get Report)

http://www.thestreet.com/story/13394908/1/like-icahn-sec-sees-danger-ahead-in-these-risky-etfs.html

China sell offi nothing compare to that,hold your btc

[jaysabi]

The shear numbers are of course increasing. But that has more to do with currency inflation than actually borrowing more money. Every major country on the planet has some debt, just like most people in this world have some financial debt. Its life.

IMO what matters is not so much the total debt a country has, but the ratio of debt to GDP. That gives you an idea of how easily a country would actually be able to pay off its debt. In the case of the US, the ratio is estimated between 104-105% which is to say its essentially a 1:1 ratio. The GDP in the United States is about equal to its debt. That's pretty common and not really all that alarming. The ratio for the entire eurozone is about ~94% with some countries well above 100%

Is debt high in the US? Yes certainly. But is it so bad that we need to stop everything and fix it now? No its not. By comparison, Greece who almost defaulted earlier this year, is somewhere north of 180%

http://www.debtclocks.eu/

Taking a snapshot at any individual moment isn't as useful as identifying the overall trend. In the past 15 years, debt:GDP ratio has risen 147% (from under 45% to over 110%).

                             GDP                        Debt (FYE)                Ratio
Dec 31, 2014   16.15 trillion                       17.82                  110.34%
Dec 31, 2013   15.76 trillion                       16.74                  106.22%
Dec 31, 2012   15.38 trillion                       16.07                  104.48%
Dec 31, 2011   15.19 trillion                       14.79                   97.37%
Dec 31, 2010   14.94 trillion                       13.56                   90.76%
Dec 31, 2009   14.54 trillion                       11.91                   81.91%
Dec 31, 2008   14.58 trillion                       10.02                   68.72%
Dec 31, 2007   14.99 trillion                        9.01                    60.11%
Dec 31, 2006   14.72 trillion                        8.51                    57.81%
Dec 31, 2005   14.37 trillion                        7.93                    55.18%
Dec 31, 2004   13.95 trillion                        7.38                    52.90%
Dec 31, 2003   13.53 trillion                        6.79                    50.18%
Dec 31, 2002   12.96 trillion                        6.23                    48.08%
Dec 31, 2001   12.71 trillion                        5.81                    45.71%
Dec 31, 2000   12.68 trillion                        5.68                    44.79%

Is a 110% ratio problematic? That single data point alone doesn't say. But in light of the trend (we were under 45% 15 years ago) and with medicare and social security expenses about to start exploding with the retiring baby boomers, yeah, it absolutely is crucial we address this now. We haven't at all over the last 15 years, despite knowing this looming crisis was coming, and we did nothing. We don't have the luxury of not acting anymore, or hoping that we can economic-growth our way out of this. We can't.