Like the illusion of Wall Street, with its vast and powerful investment banks, now shuttered, China too is an illusion perpetuated by the Globalists that gave us the 15,000 mile Caesar salad, poisoned cat food and lead based paint on babies' pacifiers. Like the illusion that money would come from thin air to always push housing prices higher, China has spent a generation pursuing its illusion. Pursuing an unattainable dream to be like the West, while 6000 years of its carefully shepherded top soil blows into the sea.
Posted: Tue Apr 22, 2008 12:38 pm Post subject: Re: Get Rid of Yer Dollars While Ye Can: Hyperinflation Com
How do U think Goog, HP, AT&T R pulling off 20-30% earnings growth? Selling more products? This inflation story even briefly hit Yahoo finance. _________________ People first, then things, then dollars.
There will be enslavement, cannibalism, & zombie invasions.
Joined: Mar 07, 2007 Posts: 391 Location: Holland, Belgica Foederata (Republic of the Seven United Netherlands)
Posted: Tue Apr 22, 2008 1:43 pm Post subject: Re: Get Rid of Yer Dollars While Ye Can: Hyperinflation Com
I was one of many people who expected the current decline of the dollar. Still I do not expect hyperinflation. Rising inflation will reduce the real value of the US national debt since the US debt is in dollars. Most (all?) countries that experienced high inflation had debts in foreign currency. The US can just stop printing after it balances its budget and walk out with hardly any debt.
Joined: Sep 14, 2004 Posts: 6613 Location: Rural Virginia
Posted: Tue Apr 22, 2008 2:05 pm Post subject: Re: Get Rid of Yer Dollars While Ye Can: Hyperinflation Com
Only in your dreams, Gerben.
That $10 trillion national debt doesn't just magically go away, unpaid. _________________ "Actually, humans died out long ago."
---Abused, abandoned hunting dog
"Things have entered a stage where the only change that is possible is for things to get worse."
---Me and my brother
Posted: Tue Apr 22, 2008 2:27 pm Post subject: Re: Get Rid of Yer Dollars While Ye Can: Hyperinflation Com
Quote:
First, it's not a 4 trillion deficit. The deficit, which is how much the US puts on its credit card every year, usually runs several hundred billion a year. The deficit is not caused by just medicare and medicaid but by all government spending. If you blamed ALL social spending on the debt, it would account for about 6 Trillion dollars
.
In the article linked the author discusses a 64 trillion total liabilty that increase by 4 trillion per year? That is what I was refering to.
Quote:
The national debt, which is what the country owes in total, is the real bugger, is closing in on 10 Trillion (that's a T) and climbing rapidly. Interest payments must be approaching 1 Trillion by now (thus the reason the US has an over 3 Trillion for the budget).
I am aware of the way governments around the world fund deficits. 10 Trillion on a 13 trillion GDP economy is not that bad. The Japanse situation is 200% times GDP. Given the interest rate on government debt is around 4-5%, 4% of $10 trillion is $400 billion. A lot of money. But almost half of this goes in intergovermental trust funds which are used to finance future obligations afaik. The US has been in far worse positions in terms of its public finances, the average percentage of government debt to GDP is 60-70% in the G20.
Quote:
Eventually, should this trend continue, the dollar will become worthless, the US economy will crash, the world economy will crash and in general there will be a lot of shouting and pointing of fingers.
If the relatively lax policy of the bush administration continues yes. Financing wars are expensive and the massive spend of 'homeland defence' had added to the spending. But policies can be changed, his tax cuts can be rolled back and the massive expansion of the military budget can and will decrease as the war in Iraq winds down.
The US government like most amercians will have to go back to living within their means. Obviously peak oil does not help!
Posted: Tue Apr 22, 2008 2:41 pm Post subject: Re: Get Rid of Yer Dollars While Ye Can: Hyperinflation Com
Gerben wrote:
I was one of many people who expected the current decline of the dollar. Still I do not expect hyperinflation. Rising inflation will reduce the real value of the US national debt since the US debt is in dollars. Most (all?) countries that experienced high inflation had debts in foreign currency. The US can just stop printing after it balances its budget and walk out with hardly any debt.
I agree. Debt is only inflationary if it is monetized. So the US could continue to expand its debt without causing inflation. Current debt is sold to the bond market and the money already in circulation is used to but the debt and then transferred to the government. I.e. there is no expansion in money.
Most money expansion has come from banks through mortgage, personal and commercial debt creation in this lax monetary environment since 2001.
The credit crunch has ended this unsustainable money supply growth and the FED most fear a Japanese style credit and asset collapse now. Rightly so, if you have read and understand what happened in Japan since 1990. Deflation is even worse that inflation because the relative value of debt continues to increase.
Posted: Tue Apr 22, 2008 3:00 pm Post subject: Re: Get Rid of Yer Dollars While Ye Can: Hyperinflation Com
mkwin wrote:
As a non-amercian I find it hard to understand the system you guys have over there.
Could someone explain to me how medi-care and other entitlements translate into a 4-trillion per year defict? Is 4 trillion the actual government spending per year or does it represent a calculation of the required investment now to meet future obligations?
As an American I'm going to have to be honest and say--> I DON'T KNOW.
I mean seriously, these numbers have me just as confused as you do. We don't have universal health care and high speed trains that run 200 mph so where the hell did ALL the money go? I'd like to know too! There are several theories and it depends upon which political ideology you want to subscribe too:
liberals say - we spent our money on war and subsidizing the freeway interstate system
conservatives - blame it on welfare and other income redistribution programs
libertarians - argue government should never get into the business of subsidizing ANYTHING. neither welfare for the poor or the rich
neo-conservatives - they have no opinion on this matter because they're too busy promoting a 100 year war in the middle east right now
///
IMHO Libertarians make the strongest argument. Subsidies are usually the root of government over-spending. And over-spending leads to collapse. I think the problems of today is basically a combination of bad decision made in the past which went unpaid. However everything in life must be paid for, either in the present or the future.
The $4 Trillion is probably just the summation ALL past unpaid debts converging. my 2 cents
Posted: Tue Apr 22, 2008 3:17 pm Post subject: Re: Get Rid of Yer Dollars While Ye Can: Hyperinflation Com
I agree with the Libertarians on this one. The problem is that once the government starts a subsidy program is never seems to end, it might grow, but it will not end.
As for inflation, what about the following scenario. There is deflationary pressure becuase of decreased lending so to "balance things out" the government prints money and uses it to pay off its debts. That way the money supply does not grow but yet the government gets out of or greatly reduces it debt.
Joined: Sep 03, 2007 Posts: 639 Location: Sunny Virginia, USA
Posted: Tue Apr 22, 2008 3:25 pm Post subject: Re: Get Rid of Yer Dollars While Ye Can: Hyperinflation Com
mkwin wrote:
Quote:
First, it's not a 4 trillion deficit. The deficit, which is how much the US puts on its credit card every year, usually runs several hundred billion a year. The deficit is not caused by just medicare and medicaid but by all government spending. If you blamed ALL social spending on the debt, it would account for about 6 Trillion dollars
.
In the article linked the author discusses a 64 trillion total liabilty that increase by 4 trillion per year? That is what I was refering to.
I've heard this type of thing before and I have no clue what they're yacking about. Do you have a link to the actual article? I'd really like to find out what they are hyping. _________________ When somebody makes a statement you don't understand, don't tell him he's crazy. Ask him what he means. -- Otto Harkaman, Space Viking
Posted: Tue Apr 22, 2008 3:40 pm Post subject: Re: Get Rid of Yer Dollars While Ye Can: Hyperinflation Com
jlw61 wrote:
mkwin wrote:
Quote:
First, it's not a 4 trillion deficit. The deficit, which is how much the US puts on its credit card every year, usually runs several hundred billion a year. The deficit is not caused by just medicare and medicaid but by all government spending. If you blamed ALL social spending on the debt, it would account for about 6 Trillion dollars
.
In the article linked the author discusses a 64 trillion total liabilty that increase by 4 trillion per year? That is what I was refering to.
I've heard this type of thing before and I have no clue what they're yacking about. Do you have a link to the actual article? I'd really like to find out what they are hyping.
It was in the article linked by the opening poster.
Posted: Tue Apr 22, 2008 5:05 pm Post subject: Re: Get Rid of Yer Dollars While Ye Can: Hyperinflation Com
It'll be a $4 trillion deficit before long. Don't forget the $3.99 trillion for government pension plans. _________________ People first, then things, then dollars.
There will be enslavement, cannibalism, & zombie invasions.
Joined: Oct 18, 2004 Posts: 2124 Location: kiwibush
Posted: Tue Apr 22, 2008 6:04 pm Post subject: Re: Get Rid of Yer Dollars While Ye Can: Hyperinflation Com
mkwin wrote:
I find it hard to believe the US is bankrupt because of these entitlements when socialist Europe is not.
I'm not entirely sure I would characterise Europe, the Union, as socialist. Keynesian with higher levels of interventionism, yes, socialist, no.
In addition, the Union is a newly created quasi federal structure, in the process of capitalising its asset base and decades behind the US in terms of finincial innovation. Give the EU time and I suspect we may see the American disease rear its head there. In the interim, Europe, along with China and India etc ride in the slipstream of Americas successes/failures and I suspect any failure on the part of the American economy could see the rise of protectionism in the European model, and then, I suspect fragmentation as the protectionist drive moves into the internal structure. _________________ Bugger me, I hear oil's runnin out mate!
Joined: Sep 03, 2007 Posts: 639 Location: Sunny Virginia, USA
Posted: Tue Apr 22, 2008 6:41 pm Post subject: Re: Get Rid of Yer Dollars While Ye Can: Hyperinflation Com
mkwin wrote:
jlw61 wrote:
mkwin wrote:
Quote:
First, it's not a 4 trillion deficit. The deficit, which is how much the US puts on its credit card every year, usually runs several hundred billion a year. The deficit is not caused by just medicare and medicaid but by all government spending. If you blamed ALL social spending on the debt, it would account for about 6 Trillion dollars
.
In the article linked the author discusses a 64 trillion total liabilty that increase by 4 trillion per year? That is what I was refering to.
I've heard this type of thing before and I have no clue what they're yacking about. Do you have a link to the actual article? I'd really like to find out what they are hyping.
It was in the article linked by the opening poster.
Ok, I think that has to do with the current obligations to future social security and retirement plans. That of course assumes that the government will not default. Of course it will. BTW, the biggest holders of treasuries, if I'm not mistaken, is the social security administration and the government retirement accounts! This means, that if/when the government defaults, the social security administration and government retiree will be the first to be hit.
That means no more checks to the old folks and our future is gone (which anyone with brains knew would happen) and/or much higher taxes.
Hey kids! Not only are you screwed out of retirement, but Mom and Dad are moving in!
The only thing that will prevent the US from default is a selective "kill everyone over the age of 50" bug. _________________ When somebody makes a statement you don't understand, don't tell him he's crazy. Ask him what he means. -- Otto Harkaman, Space Viking
Posted: Tue Apr 22, 2008 7:28 pm Post subject: Re: Get Rid of Yer Dollars While Ye Can: Hyperinflation Com
heroineworshipper wrote:
How do U think Goog, HP, AT&T R pulling off 20-30% earnings growth? Selling more products? This inflation story even briefly hit Yahoo finance.
They're pulling it off because they are tapping into money laundered from the black market. Someone named heroinworshipper should know these things!
So yes, we have the US economy being propped up by the fed and drug money. If you wondered why our silly president is currently trying to pass open trade legislation with Columbia that's why.
Right now we do have mild inflation from debt being monitized by the FED. We also have inflation from the rising price of oil and the trickle down effect. If they weren't propping up the markets we would have severe deflation from a credit crunch. The economy is also shrinking. If we have a war we will see massive inflation because they will create new debt and credit to fund the war (add to that energy costs are now 4 times what they were in the last war!) A war could also cause major resource shortages causing further inflation as governments print money to compensate. The USD also continues to fall in value against other currencies which is causing imports to rise!
Inflation is the name of the game. Severe deflation is quite possible however expect extreme inflation to follow it immedietely. The fed right now is propping up most the financial sector. A thought is they could be putting a safety net around it to protect it from a coming credit crunch. Anyways, there will be no deflationary depression like the 30s, there will be many on the outskirts of the economy struggling to survive though. This is the insiders in the upper crust versus everyone else. _________________ Just look at us. Everything is backwards; everything is upside down. Doctors destory health, lawyers destroy justice, universities destroy knowledge, governments destroy freedom, the major media destroy information and religions destroy spirituality.
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