U.S. Treasury predicts debt to rise to $20 trillion by 2015

[Patranus]

How is America almost in default now? That has to be one of the stupidest things I've ever heard. We have a AAA credit rating. Even if that slips to AA, that is still a great rating. What possible reason could you even dream of that would indicate that we are almost bankrupt?

Well it is impossible for the USA to default as it can simply print more money.
However when you do that other problems arise.

 

[sMiLeYz]

I predict if the debt level gets to 20 trillion our bond credit rating will slip and then a loan will be almost impossible. When you have to pay 100% of your pay just to pay the debt then things become a little difficult. Get ready for Bread Lines.

How bad will things get before the people revolt and have a new revolution?

I wonder how long before China collects on its debt?

America is almost in default now. Hope you like getting a 40% tax rate???

lololololol

 

[sMiLeYz]

Well it is impossible for the USA to default as it can simply print more money.
However when you do that other problems arise.

Money isn't created by printing presses, the majority of money is created by banks making loans. The money supply is influenced by the Federal Reserve Ratio, and open market operations of the Federal reserve.

That's not even the point, treasury bonds is what makes it possible for the US to accumulate debt. The market decides the value of the bonds, right now the market is saying the US bonds are the safest things in existence. US bonds are paying virtually no interest, and yet they're bought out like hotcakes.

Theoretically, the US could run government debts of 100+ trillions if the market lets it. This is macroeconomics 101 here.

 

[Genx87]

Unless you have some crazy high state/local taxes, whoever is preparing your taxes is doing it wrong. It is damn near amusing how low I got my "taxable income" this year. Hell, I even got a tax deduction simply for having a job!

Turbo tax online edition will do that to you. Just ask Timmy "Turbo Tax" Geitner.

 

[CycloWizard]

if we paid off all our debt, there would be no more cash. As a matter of fact, we would not be able to pay off our debt. We would pay as much off as we could, all money would cease to exist, and we would still have debt that we are obligated to pay off.

Because interest is an exponential function....

Um... I don't think that's quite how that works.:hmm:

 

[TridenT]

I think this is a perfect example of ATP&N at work. :awe: I wonder where the smart/well-informed people go to talk about politics on the internet (if such a place exists!).

 

[Corn]

My total tax rate is something like 30%.... I make $37k so I'm in the tax bracket that Republicans claim pays no taxes. Boy I wish I lived in the America the rightwing perceives where rich people pay all the taxes and everyone else is lazy and sleeps in hammocks all day.

LOL you are one stupid mother fucker.

Edit: Acutally, you are most likely a lying mother fucker. Computing your income on a 1040EZ, your AGI would be $27650, therefore your tax would be $3764. So, your effective tax rate would be 10% for Federal. I'm gonna doubt your state tax rate is 20%.

Either you are a liar, or simply stupid on the order of McOwned. Either way, you are a moron who is best served by shutting the fuck up. But hey, you wanna own yourself, keep posting.

 

[Patranus]

While I realize Obama inherited a very bad economy in need of repair, no way he was left with a $10 trillion repair job...

Well he has gone through 3 trillion in 18 months so its looks like he will add 8 trillion to the national debt by 2012 if he keeps up his current pace.

 

[Newbian]

I wonder how far we can milk these countries before we simply cancel all debts we owe then and laugh...

Remind many of them all the disaster funding and such we have given them makes us even.

But seriously, does anyone have some info on countries that have done that, removed the debts they owe other nations?

Post some links if you would if you find anything and thanks.

 

[Special K]

Um... I don't think that's quite how that works.:hmm:

I think what he's getting at is that the amount of money owed always exceeds the amount of money in existence. Because money is created through debt, i.e. the selling of government bonds, all new money created is owed back with interest.

 

[Hacp]

The only saving grace the US has is that we have nukes. If things really go wrong, we can bring out our nukes and scare everyone into forgiving our debt.

Then again, Russia also had nukes and it was a shithole in the 90s.

 

[Darwin333]

How is America almost in default now? That has to be one of the stupidest things I've ever heard. We have a AAA credit rating. Even if that slips to AA, that is still a great rating. What possible reason could you even dream of that would indicate that we are almost bankrupt?

Wasn't that long ago that they where selling all kinds of stuff with AAA ratings that was supposedly the safest investment you could make. Didn't turn out to well if I recall correctly. The problem with those ratings is, just like with the banksters, its in almost everyones best interest to keep our credit rating that high (except the eventual bagholders of course). I am not saying that right now today we aren't worthy of the AAA rating but I bet the bond market "cuts" our rating down before its really downgraded (if ever, too many people/countries depend on us buying more than we can afford).

As far as "already in default", I wouldn't go quite that far either but you still can't ignore the facts. The fact is that we are dependent on borrowed money for the foreseeable future. We simply can not live within our means, we MUST borrow in order to continue the day to day operations of our government. Even worse is how our debt is structured, any increase in our bond rate is almost imiediately felt in increased cost to service existing debt. People will not continue to loan us money at damn near nothing forever and as the rates start to edge up our yearly cost of servicing existing debt starts going up by 100's of billions. Since we will already be borrowing money just to cover day to day government those 100's of billions will be added to what we are required to borrow. Eventually that will catch up to us and the bond market will make the decisions for us just like they did with Greece.

We can not tax our way out of this. Doesn't matter how much you raise taxes, without significant cuts in our entitlement programs we simply can't raise that much money. I have absolutely no faith that not cut entitlements until someone else (the bond market) forces us to. (Someone correct me if I am wrong, but historically isn't 20% of GDP about the max we COLLECT in taxes, regardless of tax rates?)

We can not inflate our way out of our debt either. Our entitlement programs are indexed to inflation so if we try to inflate away 10 trillion in debt it will cost us 100 trillion in increased entitlement spending. Again, we aren't going to decrease that spending by that much nor will we remove the index to inflation. It isn't politically feasible.

Grow our way out of our debt? Can I interest you in a bridge, real cheap?

 

[Linflas]

The only saving grace the US has is that we have nukes. If things really go wrong, we can bring out our nukes and scare everyone into forgiving our debt.

Then again, Russia also had nukes and it was a shithole in the 90s.

And the only thing keeping them above water now is their oil and natural gas resources.

 

[IceBergSLiM]

Fiat money system allows us to print as much as we like! who cares! ITS ALL JUST 00000'S IN A COMPUTER. NONE OF THIS SHIT IS REAL! LOL.

 

[nick1985]

LOL you are one stupid mother fucker.

Edit: Acutally, you are most likely a lying mother fucker. Computing your income on a 1040EZ, your AGI would be $27650, therefore your tax would be $3764. So, your effective tax rate would be 10% for Federal. I'm gonna doubt your state tax rate is 20%.

Either you are a liar, or simply stupid on the order of McOwned. Either way, you are a moron who is best served by shutting the fuck up. But hey, you wanna own yourself, keep posting.

ok that was pretty funny

 

[rudder]

20,30, 40 trillion?

"Deficits dont matter"

-Darth Cheney

Actually a $200 billion deficit probably does not matter... A $400billion deficit may be necessary in extreme situations... but $3 trillion over 2 years... that freaking matters.

 

[child of wonder]

The rate at which the national debt is rising is unconscionable.

At this rate the US will be a third world country in 50 years or so.

WE'LL be the country other countries bitch about because we'll do their hard labor for $0.16 per hour.

 

[bamacre]

Money isn't created by printing presses, the majority of money is created by banks making loans. The money supply is influenced by the Federal Reserve Ratio, and open market operations of the Federal reserve.

That's not even the point, treasury bonds is what makes it possible for the US to accumulate debt. The market decides the value of the bonds, right now the market is saying the US bonds are the safest things in existence. US bonds are paying virtually no interest, and yet they're bought out like hotcakes.

Theoretically, the US could run government debts of 100+ trillions if the market lets it. This is macroeconomics 101 here.

This is basically what Bernie Madoff was thinking.

 

[ericlp]

I just love all the republican responses ... where were you when bush spent 12Trillion in his last 4 years? Hmmmmmmmmmmmmmmmm!

But all I can say is Hahaha myself since we are spending Trillions like it's going out in style. There IS NO FRIGGEN way you could print out that kinda money. If you didn't have a HUGE computer to rack up dollars by the Bit's and Bytes there would be no way for anyone to do those types of calculations.

I don't think anyone can even grasp what a Trillion dollars is. The only other place we use numbers like these is in SPACE. You know, if you had a trillion dollars and your space ship got a dollar per mile you could go to our nearest star.

A million seconds is 12 days.
A billion seconds is 31 years.
A trillion seconds is 31,688 years.

I found that kinda funny. Anyway...... It just boggles the mind to even think about these large number I doubt 5% of americans can even GRASP a trillion dollars.

Oh well... I'm not sure what the answer is to this since I highly doubt if we had a Sitting (R) for president he/she would not have just STOPPED spending money and that clearly is not the answer. It would be nice to get unemployment out of the gutter and get 80-90% of americans working with good jobs so that we could possible start paying back the this debt but sadly I just don't see that happening any time soon.

What to do...what to do! The really sad part is, we are probably racking up 2-3 million a day to float this interest.

I guess if there is anything good from all this ... we certainly are not the only country in debt. Altho we are kinda far up the list by no means are we at the top. But that does not mean we can celebrate since we haven't been paying back or come even close to balancing our books in the last 10 years. I'd say at our current spending hobbits and if we don't change course we will fail in about 5-8 years. So enjoy it! Why worry? What's the average Joe gonna do to fix this?

 

[IceBergSLiM]

Its quite funny the power private banks hold over allegedly sovereign nations. What purpose do they serve humanity....fucking blood suckers.

 

[nick1985]

I just love all the republican responses ... where were you when bush spent 12Trillion in his last 4 years?

huh?

 

[ericlp]

huh?

What? Miss him that badly? Don't drop the soap!

 

[nick1985]

What? Miss him that badly? Don't drop the soap!

So you justify Obama's insane national debt explosion by pointing to Bush increasing the debt as well? That brings you at peace in your mind?

Will the voters accept that logic?

 

[Estrella]

I predict if the debt level gets to 20 trillion our bond credit rating will slip and then a loan will be almost impossible. When you have to pay 100% of your pay just to pay the debt then things become a little difficult. Get ready for Bread Lines.

How bad will things get before the people revolt and have a new revolution?

I wonder how long before China collects on its debt?

America is almost in default now. Hope you like getting a 40% tax rate???

China will never call us out on our debt. They know we will just print the money then and there to pay them. They do not want cheap dollars in return.

 

[soccerballtux]

I think what he's getting at is that the amount of money owed always exceeds the amount of money in existence. Because money is created through debt, i.e. the selling of government bonds, all new money created is owed back with interest.

Yep, you hit the nail on the head.