Deficit Question: WHO DO WE OWE?

[glugglug]

The trillions of $$$ of piled up U.S. budget deficit -- who are we actually in debt to? What fool would loan money to us? Does the gov't get loans from Microsoft? I really would like to know this...

 

[CADsortaGUY]

oops double quoted how did that happen

Originally posted by: glugglug
The trillions of $$$ of piled up U.S. budget deficit -- who are we actually in debt to? What fool would loan money to us? Does the gov't get loans from Microsoft? I really would like to know this...

First off - you need to know the difference between "deficit" and "debt". A deficit is basically "spending" more that you have coming in(basically borrowing) in your budget. Debt is the accumulation of the borrowing( the total amount you owe)

Now as for "who" we owe this money to?

Great place to start is here -> http://www.uwsa.com/uwsa-usdebt.html

Then look here ->Frequently Asked Questions about the Debt

I've been digging around as of late and have found those two sites give a pretty good view of our national debt.

Now for deficit figures and explanations? who knows? Good luck I don't even think Congress even know what it spends all our money on!

CkG

 

[CADsortaGUY]

I realy like this section of that FAQ

----------------
How do you make a contribution to reduce the debt?

Please follow these important steps to make a contribution to reduce the debt.
Make check payable to the "Bureau of the Public Debt"
In the memo section of the check, make sure you write "Gift to reduce the Debt Held by the Public "
Mail check to -
ATTN DEPT G
BUREAU OF THE PUBLIC DEBT
P O BOX 2188
PARKERSBURG, WV 26106-2188

---------------

Ok everyone - get out your checkbooks

CkG

 

[charrison]

Originally posted by: CADkindaGUY
I realy like this section of that FAQ

----------------
How do you make a contribution to reduce the debt?

Please follow these important steps to make a contribution to reduce the debt.
Make check payable to the "Bureau of the Public Debt"
In the memo section of the check, make sure you write "Gift to reduce the Debt Held by the Public "
Mail check to -
ATTN DEPT G
BUREAU OF THE PUBLIC DEBT
P O BOX 2188
PARKERSBURG, WV 26106-2188

---------------

Ok everyone - get out your checkbooks

CkG

Shame there is not a checkbox on our federal taxes for that....

 

[zephyrprime]

We owe most of the money to our citizens. Most government debt is in the form of bonds. aka, T-bills. So if you have a t-bill or own a mutual fund that owns any t-bills, you hold part of the debt.

Much of the government bonds is also held by foreigners. Not foreign governments but foreign individuals. I think the amount is like 30-40% or something like that.

Also, much of the money is owed to....the government. That's right, the government has borrowed it's own money. You're probably wondering how the heck this works. Well, it's like this. Social Security has been runing a surplus for a long time. This extra money gets thrown into the SS trust fund. The trust fund has to invest in something. Some bright and evil congressman at some point in time figured out that he could write into law a requirement that the SS fund lend it's money to the government at a super low rate (~2%). This screws all the people that will need SS money someday when SS receipts fall below outlays. This is why you sometimes hear people saying on TV "there is no trust fund!".

 

[wirelessenabled]

Originally posted by: charrison

Originally posted by: CADkindaGUY
I realy like this section of that FAQ

----------------
How do you make a contribution to reduce the debt?

Please follow these important steps to make a contribution to reduce the debt.
Make check payable to the "Bureau of the Public Debt"
In the memo section of the check, make sure you write "Gift to reduce the Debt Held by the Public "
Mail check to -
ATTN DEPT G
BUREAU OF THE PUBLIC DEBT
P O BOX 2188
PARKERSBURG, WV 26106-2188

---------------

Ok everyone - get out your checkbooks

CkG

Shame there is not a checkbox on our federal taxes for that....

What would be the point of that? The Government takes in X dollars and spends X+$400 bil. All a check box on the form would do is have the effect of the Gov taking in X-x dollars and still spending X+$400 bil with the x going to "pay down" the debt. Net effect on total debt is zero.

 

[LunarRay]

may be of interest
and this

but here is the fed's own... like the real sauce...
go to monitary policy and then the beige book.... it is an interesting read...
I wish I had a dollar for every one you owe... Abdul...

because I fear you'll not read it ...

Abstract: Movements in the prices of different assets are likely to directly influence one another. This paper identifies the contemporaneous interactions between asset prices in U.S. financial markets by relying on the heteroskedasticity in their movements. In particular, we estimate a "structural-form GARCH" model that includes the short-term interest rate, the long-term interest rate, and the stock market. The results indicate that there are strong contemporaneous interactions between these variables. Accounting for this behavior is critical for interpreting daily changes in asset prices and for predicting the future paths of their variances and correlations. We demonstrate the importance of this consideration in a risk-management application.

or read this...
Abstract: We examine the performance and robustness properties of alternative monetary policy rules in the presence of structural change that renders the natural rates of interest and unemployment uncertain. Using a forward-looking quarterly model of the U.S. economy, estimated over the 1969-2002 period, we show that the cost of underestimating the extent of misperceptions regarding the natural rates significantly exceeds the costs of overestimating such errors. Naive adoption of policy rules optimized under the false presumption that misperceptions regarding the natural rates are likely to be small proves particularly costly. Our results suggest that a simple and effective approach for dealing with ignorance about the degree of uncertainty in estimates of the natural rates is to adopt difference rules for monetary policy, in which the short-term nominal interest rate is raised or lowered from its existing level in response to inflation and changes in economic activity. These rules do not require knowledge of the natural rates of interest or unemployment for setting policy and are consequently immune to the likely misperceptions in these concepts. To illustrate the differences in outcomes that could be attributed to the alternative policies we also examine the role of misperceptions for the stagflationary experience of the 1970s and the disinflationary boom of the 1990s