This link is a little political, but I don't think biased against one side or the other. I think it's a pretty good summary of the guns we have pointed at our collective heads. I really can't imagine any scenario where we are looking at anything but a very rough ride. Thoughts?
phil_in_cs wrote:I've been hearing the "any minute now" on the debt bomb busting since the late 1970's. People were probably saying it earlier, I just wasn't paying attention.
I will bump this to off topic in the morning unless someone can demonstrate this is "Current Events". Howard Ruff and Gary North made a pretty good case for it being immanent 30 years ago.
Nope not a disaster. Certainly not a current disaster. It is a prediction of possible scenarios that can lead to a disaster.
1. Federal Budget Deficit Bomb. The Bush/Cheney wars pushed America deep into a debt hole. Federal debt limit was just raised almost 100% with Obama's 2010 budget, to $14.3 trillion vs. $7.8 trillion in 2005. The Congressional Budget Office predicts future deficits around 4% through 2020. Get it? America's debt at 84% of GDP will soon pass that toxic 90% trigger point.
6. Peak Oil and the Population Bomb. China and India each need 500 new cities. The United Nations estimates world population exploding 50% from 6 billion to 9 billion by 2050: Three billion more humans demanding more automobiles, exhausting more resources to feed their version of the gas-guzzling "America Dream."
7. Social Security Bomb. We have no choice; eventually we must either cut benefits or raise taxes. Politicians hate both, so they'll do nothing. Delays worsen solutions. Without action, by 2035 Social Security and Medicare benefits will eat up the entire federal budget other than defense.
11. Underfunded Corporate Pensions Bomb. From $60 billion surplus in 2007 to $409 billion deficit in 2009. And a whopping 92% of the pension plans of companies are now underfunded. Defaults are guaranteed by taxpayers.
16. Fed/Treasury Bailout Bombs. Tax credits, loans, cash and purchase of toxic assets from Wall Street banks estimated at $23.7 trillion as new debt was shifted from too-big-to-fail Fat-Cat banks to taxpayers.
18. Shadow Banking: The Derivatives Bomb. Wall Street wants no regulation of this $670 trillion, high-risk, out-of-control casino that's highly leveraged versus the $50 trillion total GDP of all nations. We forget that derivatives almost destroyed global economies in 2008-09, finally will by 2012.
America's debt at 84% of GDP will soon pass that toxic 90% trigger point.
Not to be pedantic, but other than being bored with the topic, could you explain how this potential disaster is any less of a current disaster than:
Intel chief: Al-Qaida likely to attempt attack within months
Social Unrest in Russia may be MAJOR problem.
All of which are only potential, or not even, disasters at all.
SiXiam wrote:America's debt at 84% of GDP will soon pass that toxic 90% trigger point.
This should have said it was all debt, not just government debt (meaning it includes consumer debt like mortgages and credit cards).
Total Debt: $11,909,829,003,511
Debt is 83.48% of GDP
Keep in mind that debt isn't always bad. Massive government debt isn't good, but consumer debt like mortgages is good debt to a point.
Without loans and debt, people couldn't afford to buy houses or cars and most businesses couldn't be started, yet alone expanded.
The United States government debt, commonly called the "public debt" or the "national debt", is the amount of money owed by the Federal government of the United States to holders of U.S. debt instruments.
phil_in_cs wrote:I don't dispute this could be an disaster in the short term if things come to pass as he says. My biggest problem w/ this subject is we get one a day or more on it, mostly very political. This is a man made problem after all, and the blame game and what to do are political questions at the root.
There are two other financial crisis threads in the top 10 now; do we need a third?
WhoShotJR wrote:Actually, no he was right about fed gov debt approaching 84% of GDP. Total US debt was closer to 350% of GDP in 2008. It's much higher than that now.
DrthTater wrote:CaptBrainFreeze wrote:That's it....no more clicking on Zombie Squad member youtube links.
Did you miss the dinosaur porn thread?
squinty wrote:I'm not sure how many licks it takes to get high off fake rice, though. The world may never know.
phil_in_cs wrote:I used to think it was 'any day now', but after 30+ years I've gotten tired of holding my breath.
phil_in_cs wrote:http://news.bbc.co.uk/2/hi/business/8614782.stm says that Greece is paying $15B month in debt service, and does not have any cash. They were previously going to have to pay 7% or more in interest to borrow money, this $40B is at 5% and the market rate dropped to 6.1%.
The $40B is less than 3 months of debt service. It is hard to see how they will be able to come up with some plan in the next 3 months that will be a permanent solution. They are still borrowing money from one source to pay another - this just gets them a better rate.
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