US could run out of cash as soon as Dec. 15, Janet Yellen warns

[DrBeer]

Understand one simple thing - the USA produces the most demanded product in the world - the DOLLAR! Everyone needs it, because he can do anything. Whether someone likes it or not ... And given that the "blood" of the world economy is the same dollar, the printed extra billions of dollars will not create any noticeable negative for either the US economy or the world economy. The world market will eat all the pieces of paper that the United States will give him. In the end, when the printed money returns to the banking system, everything that the USA needs will be bought with it - they will saturate its market with what it needs, the "extra paper" will dissolve in the accounts and wallets of manufacturers around the world.

[dzonikg28]

Understand one simple thing - the USA produces the most demanded product in the world - the DOLLAR! Everyone needs it, because he can do anything. Whether someone likes it or not ... And given that the "blood" of the world economy is the same dollar, the printed extra billions of dollars will not create any noticeable negative for either the US economy or the world economy. The world market will eat all the pieces of paper that the United States will give him. In the end, when the printed money returns to the banking system, everything that the USA needs will be bought with it - they will saturate its market with what it needs, the "extra paper" will dissolve in the accounts and wallets of manufacturers around the world.

This makes quite a lot of sense and honestly, how often has it now been said that the US is going to be broke in a couple of weeks from now? Countless times by now?

What you just outlined here is the truth and actually the one thing that does indeed safe the US. I am wondering though whether the US dollar will stay on top for very long as there is reason to believe that this could change in the future.

https://www.bloomberg.com/news/articles/2021-11-15/global-wealth-surges-as-china-overtakes-u-s-to-grab-top-spot

China's net worth grew from $7 trillion to $120 trillion between 2000 and 2020 whereas the US doubled their net worth to $90 trillion over the same period of time.

[savetheFORUM]

Understand one simple thing - the USA produces the most demanded product in the world - the DOLLAR! Everyone needs it, because he can do anything. Whether someone likes it or not ... And given that the "blood" of the world economy is the same dollar, the printed extra billions of dollars will not create any noticeable negative for either the US economy or the world economy. The world market will eat all the pieces of paper that the United States will give him. In the end, when the printed money returns to the banking system, everything that the USA needs will be bought with it - they will saturate its market with what it needs, the "extra paper" will dissolve in the accounts and wallets of manufacturers around the world.

Okay, that must be great points.  The  U.S. dollar being in power gives it a lot of advantages. Maybe all these things that people are saying that there will be a problem and this and that, maybe it’s not going to happen, but don’t you think that they still have to be careful and try to apply measures that are going to help make things better? Because this is just like a wearing of shoes, maybe it wouldn’t have an effect now, but as time goes on as it continues to pile up,  the time might come when it will finally have an effect, and the effect they might not be able to handle it.

So, if they really want to avoid such a problem, maybe now would be a good time to start applying measures that are going to help them to avoid all these problems in the future. I do know that for many years now that a lot of people keep saying things like this but it never happens come but they (government) still have to be careful and mind the kind of actions they are taking.

[wxa7115]

Understand one simple thing - the USA produces the most demanded product in the world - the DOLLAR! Everyone needs it, because he can do anything. Whether someone likes it or not ... And given that the "blood" of the world economy is the same dollar, the printed extra billions of dollars will not create any noticeable negative for either the US economy or the world economy. The world market will eat all the pieces of paper that the United States will give him. In the end, when the printed money returns to the banking system, everything that the USA needs will be bought with it - they will saturate its market with what it needs, the "extra paper" will dissolve in the accounts and wallets of manufacturers around the world.

Okay, that must be great points.  The  U.S. dollar being in power gives it a lot of advantages. Maybe all these things that people are saying that there will be a problem and this and that, maybe it’s not going to happen, but don’t you think that they still have to be careful and try to apply measures that are going to help make things better? Because this is just like a wearing of shoes, maybe it wouldn’t have an effect now, but as time goes on as it continues to pile up,  the time might come when it will finally have an effect, and the effect they might not be able to handle it.

So, if they really want to avoid such a problem, maybe now would be a good time to start applying measures that are going to help them to avoid all these problems in the future. I do know that for many years now that a lot of people keep saying things like this but it never happens come but they (government) still have to be careful and mind the kind of actions they are taking.

And that is the main issue, there was a time the British pound was the reserve currency of the world but then it got replaced by the dollar, so while the US is taking full advantage of this it may come the day in which the US dollar will be replaced by another currency.

And while this is inevitable, at the same time the way they are manipulating their currency supply and causing high inflation all over the world means that competing countries have more and more reasons to begin to look for alternatives to the current system, accelerating the collapse of the dollar in the process.

[Sithara007]

~~~
https://www.bloomberg.com/news/articles/2021-11-15/global-wealth-surges-as-china-overtakes-u-s-to-grab-top-spot

China's net worth grew from $7 trillion to $120 trillion between 2000 and 2020 whereas the US doubled their net worth to $90 trillion over the same period of time.

Not surprised. US penalizes wealth creators by imposing more and more taxes (now there is an insane proposals to tax capital gains up to 60%), and encourages those who are unproductive. China on the other hand prioritizes wealth creation and clamps down on social parasites and welfare rats. The results are out there for everyone to see. Wealth creators are moving out of the US, and opening their factories elsewhere. Obamacare and rising minimum wages have made opening businesses and factories in the US unsustainable.

[so98nn]

It amuses me how perfectly developed country like U.S. can get into trap like this? I mean developing countries are way better than U.S. in managing their economy and reduce the inflation at faster rates. For example, many asian countries are on the list who has so much population, so much infra to develop and survive on both farmers and huge IT and pharma sectors. They have giant infra to develop for their country, they have huge problems being democratic countries, no presidential rule, yet contributing to biggest economic bulge to the globe. I am pretty sure U.S. is like a country who overspends the budgets all the time on unnecessary stuff. They have so much industrialisation and perfect taxation system then also they run out of the funds. It's way funny to think. I am not sure if this is true but I have read somewhere that they overspend the money military and keep doing so in trillions of dollars. Is it really necessary to do so?

[tyz]

The US can't practically run out of cash as long as the world reserve currency is the USD. They can print money to pay their debts even to foreign countries. Of course that's a single use get-out-of-jail card. Because once they do that, the USD will cease to be the reserve currency.

Possibly at that point some "other" currency that is not controlled by any single government... perhaps something decentralized.

The question is what would be the alternative to the reserve currency US dollar for export-strong countries?

There is none. It would damage confidence massively, but in principle not much would change. There would be only two options as a reserve currency, that would be the Euro and the Yuan. But both have their weaknesses, and other currencies like the Yen or the Swiss Franc are too small to serve as a world reserve currency.

[wxa7115]

It amuses me how perfectly developed country like U.S. can get into trap like this? I mean developing countries are way better than U.S. in managing their economy and reduce the inflation at faster rates. For example, many asian countries are on the list who has so much population, so much infra to develop and survive on both farmers and huge IT and pharma sectors. They have giant infra to develop for their country, they have huge problems being democratic countries, no presidential rule, yet contributing to biggest economic bulge to the globe. I am pretty sure U.S. is like a country who overspends the budgets all the time on unnecessary stuff. They have so much industrialisation and perfect taxation system then also they run out of the funds. It's way funny to think. I am not sure if this is true but I have read somewhere that they overspend the money military and keep doing so in trillions of dollars. Is it really necessary to do so?

They got complacent, the dollar has been the reserve currency of the world for so long that they think they can keep abusing of their privilege forever, this is why they can get away with financial and economic policies that will simply bankrupt any other country, but this is not going to last forever.

Competing countries are tired of this advantage the dollar gives to the US and they are looking for ways to reduce the amount of dollars they keep in reserve and that they accept as payment, and if enough countries begin to do this then the rate of inflation of the dollar on its home country will increase dramatically as those dollars will have nowhere to go but back to the US.

[Hydrogen]

The december 15th, 2021 deadline is looming large on the horizon.

My memory of past debt ceiling raises and the implications of it not being raised are vague.

Some sources claim that failure to raise the debt ceiling would result in a default. Other sources have said that essential operations and funding of programs like social security, unemployment and food stamps would continue to run normally while other less critical aspects of government would be shut down.

If the debt ceiling is not raised before the deadline, I guess we will all find out together what the real world implications are.

Vaguely, I seem to remember the debt ceiling not being raised and government shutting down under Obama. Without anything serious happening, most may not even have realized it occurred. But I could be remembering incorrectly on that.

[Abiky]

Understand one simple thing - the USA produces the most demanded product in the world - the DOLLAR! Everyone needs it, because he can do anything. Whether someone likes it or not ... And given that the "blood" of the world economy is the same dollar, the printed extra billions of dollars will not create any noticeable negative for either the US economy or the world economy. The world market will eat all the pieces of paper that the United States will give him. In the end, when the printed money returns to the banking system, everything that the USA needs will be bought with it - they will saturate its market with what it needs, the "extra paper" will dissolve in the accounts and wallets of manufacturers around the world.

That's the point. The US is still the leading economy of the world, even with the negative effects of the COVID-19 pandemic. Since the US Dollar is the reserve currency of the world, the government can easily manipulate the mainstream economy in its favor. "Running out of cash" is simply an excuse to print more money in the long haul. This will only create a higher inflation rate, effectively devaluing the US Dollar. Of course, this won't remove the US Dollar's dominance on the world economy. But it will have a negative effect over people's pockets as costs become too high to bear. Luckily, this will "pump" scarce assets like Bitcoin and Gold all the way to the moon. Holders of these assets will obtain greater purchasing power as inflation grows like crazy. The US government claims the current situation is temporary so there's hope everything will go back to normal after the end of the COVID-19 pandemic. Just my thoughts

[DrBeer]

Understand one simple thing - the USA produces the most demanded product in the world - the DOLLAR! Everyone needs it, because he can do anything. Whether someone likes it or not ... And given that the "blood" of the world economy is the same dollar, the printed extra billions of dollars will not create any noticeable negative for either the US economy or the world economy. The world market will eat all the pieces of paper that the United States will give him. In the end, when the printed money returns to the banking system, everything that the USA needs will be bought with it - they will saturate its market with what it needs, the "extra paper" will dissolve in the accounts and wallets of manufacturers around the world.

This makes quite a lot of sense and honestly, how often has it now been said that the US is going to be broke in a couple of weeks from now? Countless times by now?

What you just outlined here is the truth and actually the one thing that does indeed safe the US. I am wondering though whether the US dollar will stay on top for very long as there is reason to believe that this could change in the future.

https://www.bloomberg.com/news/articles/2021-11-15/global-wealth-surges-as-china-overtakes-u-s-to-grab-top-spot

China's net worth grew from $7 trillion to $120 trillion between 2000 and 2020 whereas the US doubled their net worth to $90 trillion over the same period of time.

It is difficult to say what to expect, but if the US itself does not do stupid things and / or an objectively more profitable instrument does not appear than the dollar, and it is not accepted by the world economic majority, the dollar has no problems on the horizon. China is perhaps the biggest bubble in human history. And soon enough you will see the Chinese economy rushing downward, picking up speed and demolishing everything in its path. This will destroy the Chinese economy, and affect the world economy, but the world economy is larger and more stable than the Chinese one, ABSOLUTELY dependent on the market of buyers from the same EU and the USA.

Understand one simple thing - the USA produces the most demanded product in the world - the DOLLAR! Everyone needs it, because he can do anything. Whether someone likes it or not ... And given that the "blood" of the world economy is the same dollar, the printed extra billions of dollars will not create any noticeable negative for either the US economy or the world economy. The world market will eat all the pieces of paper that the United States will give him. In the end, when the printed money returns to the banking system, everything that the USA needs will be bought with it - they will saturate its market with what it needs, the "extra paper" will dissolve in the accounts and wallets of manufacturers around the world.

Okay, that must be great points.  The  U.S. dollar being in power gives it a lot of advantages. Maybe all these things that people are saying that there will be a problem and this and that, maybe it’s not going to happen, but don’t you think that they still have to be careful and try to apply measures that are going to help make things better? Because this is just like a wearing of shoes, maybe it wouldn’t have an effect now, but as time goes on as it continues to pile up,  the time might come when it will finally have an effect, and the effect they might not be able to handle it.

So, if they really want to avoid such a problem, maybe now would be a good time to start applying measures that are going to help them to avoid all these problems in the future. I do know that for many years now that a lot of people keep saying things like this but it never happens come but they (government) still have to be careful and mind the kind of actions they are taking.

Absolutely agree ! No matter how stable the dollar and the US economy are, an overestimation of its capabilities always leads to very unpleasant consequences. But now I do not see any signs of such "stupid actions" that can really lead to a catastrophe of the US economy and the dollar as a whole. There is still one side of the problem - even if the dollar is "bad", the question is - who will replace it? euro? yuan? pound? The world economy will not be able to operate on multicurrency settlements; they need a unique means of calculation. But none of the above are suitable for this role.


[moderator's note: consecutive posts merged]

[omone1]

They always have a way of lobbying the opposition members to reach a compromise and get the economy running. If the US runs out of cash,many sectors will suffer, even stock market could crash heavily and many nations dependent on US aid would be distressed. The US really need to enforce some financial discipline and stop reckless printing of money that always cause inflation.

[Gyfts]

~~~
https://www.bloomberg.com/news/articles/2021-11-15/global-wealth-surges-as-china-overtakes-u-s-to-grab-top-spot

China's net worth grew from $7 trillion to $120 trillion between 2000 and 2020 whereas the US doubled their net worth to $90 trillion over the same period of time.

Not surprised. US penalizes wealth creators by imposing more and more taxes (now there is an insane proposals to tax capital gains up to 60%), and encourages those who are unproductive. China on the other hand prioritizes wealth creation and clamps down on social parasites and welfare rats. The results are out there for everyone to see. Wealth creators are moving out of the US, and opening their factories elsewhere. Obamacare and rising minimum wages have made opening businesses and factories in the US unsustainable.

The US can't keep up their taxes on the wealthy with their spending habits, despite the harsh rhetoric of wealth taxes or ensuring the rich pay their fair share. Most of it is political pandering, as are many other things related to demonizing the rich, but on a deeper level politicians are aware that if they keep driving up the effective tax rate, it'll slow down growth. The strategy for the US, I'm assuming, has been growing the economy in order to raise enough revenue to pay off the debt. Their reckless spending has not slowed down, and Covid has slowed the economy, so all this has thrown a wrench in their plans. Expect a wealth tax to be passed sooner rather than later.

[Sithara007]

Not surprised. US penalizes wealth creators by imposing more and more taxes (now there is an insane proposals to tax capital gains up to 60%), and encourages those who are unproductive. China on the other hand prioritizes wealth creation and clamps down on social parasites and welfare rats. The results are out there for everyone to see. Wealth creators are moving out of the US, and opening their factories elsewhere. Obamacare and rising minimum wages have made opening businesses and factories in the US unsustainable.

The US can't keep up their taxes on the wealthy with their spending habits, despite the harsh rhetoric of wealth taxes or ensuring the rich pay their fair share. Most of it is political pandering, as are many other things related to demonizing the rich, but on a deeper level politicians are aware that if they keep driving up the effective tax rate, it'll slow down growth. The strategy for the US, I'm assuming, has been growing the economy in order to raise enough revenue to pay off the debt. Their reckless spending has not slowed down, and Covid has slowed the economy, so all this has thrown a wrench in their plans. Expect a wealth tax to be passed sooner rather than later.

Personally I believe that wealth tax is a regressive idea. The democrats are debating about it, because they believe that it will make the billionaires pay more taxes than they are doing right now. It was Ron Wyden (D-Oregon), who first proposed to tax unrealized capital gains, claiming that the uber-rich hardly ever sell their assets and that makes it extremely difficult to tax them. I don't support this move as well, but for me at least on paper taxing the unrealized capital gains sounds more viable than imposing a wealth tax.

[Ozero]

December 15 is long gone, but we don't see anything negatively impacting the US finances and economy. They used to close financial problems by printing new dollars. Of course, this cannot continue indefinitely. In this case, the states will gradually abandon the dollar, and the reasons for this may be different. Russia is now doing this to evade international sanctions. The news is that the dollar is really falling and it is better to invest in the British pound, Japanese yen and Swiss franc. The Euro does not seem to be much quoted either.

[Marvell1]

I think this news is a bit unnecessarily alarmist. Whenever the US government starts facing a cash crises they always find a way to pawn off the debt in complicated ways. I think they will just print more money, therefore dropping the value of the USD via inflation and the ones who will have to foot the bill will be the citizens of the US. That way the dollar amount debt they owe stays the same but loses value at the same time.

And bread and milk at the supermarket rises in price, the unemployment rate up down because the companies can't handle the inflation without firing people and now you have more people on the streets.

Read this: https://www.voanews.com/a/us-national-debt-tops-30-trillion-for-first-time-in-history-/6424498.html

According to this source US national debt tops 30 trillion for the first time in history!

For the first time since World War II in 1946, the United States was indebted to such a large amount. Which is a matter of considerable concern.

So, still you think the news is unnecessarily alarmist. You should read the whole news from this source before you think so.


The government can run out of money because of the debt of such a large amount. And printing more money would not be able to save them.
Prior to the outbreak of the corona virus, the country was already in debt and the COVID spread and the economy began to collapse in a lockdown.
And that's why so many people in the United States are out of work. And the United States has to borrow more to cover the deficit.
According to the US Department of Revenue, from January 2021 to January 2022, government debt increased to $7 trillion.

In this regard, Janet Yellen's statement seems to be correct.

[Abiky]

Read this: https://www.voanews.com/a/us-national-debt-tops-30-trillion-for-first-time-in-history-/6424498.html

According to this source US national debt tops 30 trillion for the first time in history!

For the first time since World War II in 1946, the United States was indebted to such a large amount. Which is a matter of considerable concern.

So, still you think the news is unnecessarily alarmist. You should read the whole news from this source before you think so.


The government can run out of money because of the debt of such a large amount. And printing more money would not be able to save them.
Prior to the outbreak of the corona virus, the country was already in debt and the COVID spread and the economy began to collapse in a lockdown.
And that's why so many people in the United States are out of work. And the United States has to borrow more to cover the deficit.
According to the US Department of Revenue, from January 2021 to January 2022, government debt increased to $7 trillion.

In this regard, Janet Yellen's statement seems to be correct.

$30T in national debt is a lot of money. I think COVID has terribly damaged the US economy where there would be no point for recovery. If this keeps up, then the US will go bankrupt taking the global economy down with it. After all, the US Dollar is the world's reserve currency. There's only one solution to this problem. And that is Bitcoin. If people start saving money in Bitcoin, their wealth/purchasing power would be unaffected by the USD's ever-rising inflation rates. Governments can benefit from Bitcoin's deflationary abilities, if they adopt it as legal tender. El Salvador already did the move, what makes you think other countries won't do the same? With Fiat collapsing, there could be a strong reason to switch to Bitcoin altogether.

We'll see how everything will turn out to be in the future as the American economy goes on the brink of collapse. Just my opinion

[pinggoki]

$30T in national debt is a lot of money. I think COVID has terribly damaged the US economy where there would be no point for recovery. If this keeps up, then the US will go bankrupt taking the global economy down with it. After all, the US Dollar is the world's reserve currency. There's only one solution to this problem. And that is Bitcoin. If people start saving money in Bitcoin, their wealth/purchasing power would be unaffected by the USD's ever-rising inflation rates. Governments can benefit from Bitcoin's deflationary abilities, if they adopt it as legal tender. El Salvador already did the move, what makes you think other countries won't do the same? With Fiat collapsing, there could be a strong reason to switch to Bitcoin altogether.

We'll see how everything will turn out to be in the future as the American economy goes on the brink of collapse. Just my opinion

It's not that worrying for them though, they've been in a lot of housing crisis before so I really don't know if they're experiencing something bad, to be honest I think that they will eventually recover from this even without paying those debts because I feel like they care more about letting the debt stay because those who lend those money probably cares more about the favor rather than the getting the money back.

[Sebas.tian]

I guess the US president will not allow such thing to happen to their citizens economy than to do everything possible to eliminate inflation,bad economy and make cash surplus to the people. President will not accommodate corruption that will make his country to run out of cash than to print more money that will sustain the country economy like 20 years before another government will take over the government and to make sure the economy do not collapse for his hands.

US president has done so much to their economy which they will never experience economy crisis or cash crisis in the country. US Centra bank is well ready to print any amount of money the president will instruct them to print more cash that will make inflation not to near their country.

[DrBeer]

Yes, I remember this thread! Well, tell me how "the US ran out of cash"? Has the dollar already collapsed? Is the US economy bankrupt? Yuan has become the world's international settlement currency? Not ? Oh - why so? Yeah, I understand - now the national debt will grow to $ 35 billion, and then "everything will definitely collapse in the USA"! But you will be surprised - NOTHING will happen. You just need to read less science fiction propagandists