Obama Debt in 45 days 294,000,000,000$-2017 set to be 2.45 trillion- Over 106% of GDP

a reply to: TinySickTears

I have a hard time understanding where all that sweet sweet money is going.

originally posted by: seasonal
a reply to: Gothmog

That's true, is that a coincidence? Trump has said very little, as fr as I can remember about and thing backing the Dollar.

If I were Trump , I would tread carefully on that subject. But you just made me wonder when the next time the Fed Charter has to be renewed, Or does it , now?

a reply to: Gothmog

en.wikipedia.org...

The Federal Reserve Act was originally granted a twenty-year charter, to be renewed in 1933. This clause was amended on February 25, 1927: "To have succession after the approval of this Act until dissolved by Act of Congress or until forfeiture of franchise for violation of law." 12 U.S.C. ch. 3. As amended by act of Feb. 25, 1927 (44 Stat. 1234). The success of this amendment is notable, as in 1933, the US was in the throes of the Great Depression and public sentiment with regards to the Federal Reserve System and the banking community in general had significantly deteriorated. Given the political climate, including of Franklin D. Roosevelt’s administration and New Deal legislation, it was uncertain whether the Federal Reserve System would survive.

originally posted by: seasonal
a reply to: Gothmog

en.wikipedia.org...

The Federal Reserve Act was originally granted a twenty-year charter, to be renewed in 1933. This clause was amended on February 25, 1927: "To have succession after the approval of this Act until dissolved by Act of Congress or until forfeiture of franchise for violation of law." 12 U.S.C. ch. 3. As amended by act of Feb. 25, 1927 (44 Stat. 1234). The success of this amendment is notable, as in 1933, the US was in the throes of the Great Depression and public sentiment with regards to the Federal Reserve System and the banking community in general had significantly deteriorated. Given the political climate, including of Franklin D. Roosevelt’s administration and New Deal legislation, it was uncertain whether the Federal Reserve System would survive.

And John F. Kennedy refused to re-up that charter. Reverted for a short time to the Treasury and printed silver-backed dollars. Immediately after the assassination , Johnson being sworn in on the flight from Dallas to DC , signed the charter. In Lincoln's time , it was actually named the Central Bank . Located in Philadelphia (if I remember correctly) and based i the Central Bank of England.
" Between the enemy in front , and the bankers behind , it is the latter that concerns me most" - Lincoln

a reply to: Gothmog
Looks like congress or forfeiture of the franchise is the only way to get rid of it, according to this info.

en.wikipedia.org...

. This clause was amended on February 25, 1927: "To have succession after the approval of this Act until dissolved by Act of Congress or until forfeiture of franchise for violation of law." 12 U.S.C. ch.

I dont think they plan on paying it back. Even if they were going to try its not possible. They will run various versions of quantitative easing and at some point it will all collapse. When it does, they will replace the dollar with a new currency and do it again. Would make for an easy transition to a cashless society. Easy for them that is.

originally posted by: dfnj2015
Taxes, deficit, and debt are irrelevant. All that matters is the purchasing power of median worker's take home pay. You can't talk about taxes, deficit, and debt without considered the cost of goods and services. If you are only concentrated on half of the equation you might as well cut off one of your legs. The problem we have in this country is from having no free markets and no competition. Corporations can charge whatever they want. CEOs can take has much pay as they want. When you have no competition you get rid of the excesses in the privately owned bureaucracies.

The problems with our country are not rocket science. The lobbyists force the politicians to pass laws creating cartels and monopolies in exchange for campaign financing. There's are specific reasons why wealth inequality in this country, and the rest of the world, is at all time highs. Money talks, and the people without money have no representation.

You know the good thing about the debt. Whoever holds it sure as hell isn't going to get it paid back!

The debt gets paid back all the time. US government debt is fixed term and seen as one of the safest assets you can hold.

originally posted by: SaturnFX

originally posted by: reldra
a reply to: seasonal

Well, it will be fixed. See, Trump has a plan. He says he will order that more money be printed. Seems mathematically sound to me.

his economic plan is pretty sound actually
See, he is gonna spend a lot more on military, and infrastructure, and cut taxes.

..wait, this is a stupid plan.

I would say two out of the three are actually a pretty good plan.

Increased infrastructure investment and lowering tax rates for low and middle income would be exactly what the US economy needs.

a reply to: seasonal

Debt is a function of creating money via credit because if we borrow $1,000 and have to pay 5% interest on it where do we get the $500 from to pay the interest? The common answer is that it come from profit, savings etc.

It does not matter from which direction it comes from, profit or savings from wages etc, it was originally borrowed into the economy in the first place. In other words, if we borrow a $100 which the banks create out of thin air then we also have to borrow the money to pay the interest irrespective of the route it travels to get back to our pocket.

As you can see, the ever rising debt has nothing to do with corporate welfare, individual welfare, defense or anything else, it has everything to do with the function of credit and only banks can create money out of thin air via the creation of credit.

So it begins...

This debt is purposeful and intended to crash the dollar to cause the destruction of the U.S. and pave the way for NWO Globalists such as the Rothschilds who at least partly control the Federal Reserve. The goal appears to be depopulation as taxpayers aren't worth anything after the economy fails and Obama and Co. did their part to help set it all up.
There is no way to come out of this hole.
We've been kept falsely aloft since 2008 and overseers such as Soros have their fingers on the trigger waiting to decide the moment to bring it all tumbling down.

It's likely going to happen around inauguration time with the masses blaming Trump, increased rioting leading to martial law and all the fun that comes with that.

We're not supposed to get out of debt. It was the backup plan to Hillary's win leading to nuclear war.
Listen or don't. Won't matter much and no one will even believe it when it all goes down.

originally posted by: dfnj2015
Taxes, deficit, and debt are irrelevant.

Tell that to the people of Japan who pay 20% of government funds to servicing their debt load. A similar debt load in the USA would likely lead to hyperinflation. As to why it has not already lead to hyperinflation in Japan, I don't know... that is very surprising. But I do know that if Japan were to pay a 0.5% higher interest rate, their government would default within months.

No the debt load is one of the most important numbers in the economy. Government spending as %GDP is the most important with government revenues as %GDP being equally important. There is no better predictor that I know of that will tell you how well off an economy will do in the future.

Hong Kong and Singapore are regularly the fastest growing economies, and regularly have the lowest government spending levels. After Singapore accumulated a large government debt load, its GDP took a very nasty spill recently. Imagine that.

originally posted by: Bluntone22
Ya gotta admit that Obama has spent like a drunken sailor on shore leave.
This kind of spending will catch up to us all in the end.

the authority of spending money on what and by how much, comes from congress which has been controlled by republicans since Jan. 3rd 2011....I thought you knew this?....or are you just lying or faking news?

originally posted by: fractal5

originally posted by: dfnj2015
Taxes, deficit, and debt are irrelevant.

Tell that to the people of Japan who pay 20% of government funds to servicing their debt load. A similar debt load in the USA would likely lead to hyperinflation. As to why it has not already lead to hyperinflation in Japan, I don't know... that is very surprising. But I do know that if Japan were to pay a 0.5% higher interest rate, their government would default within months.

No the debt load is one of the most important numbers in the economy. Government spending as %GDP is the most important with government revenues as %GDP being equally important. There is no better predictor that I know of that will tell you how well off an economy will do in the future.

Hong Kong and Singapore are regularly the fastest growing economies, and regularly have the lowest government spending levels. After Singapore accumulated a large government debt load, its GDP took a very nasty spill recently. Imagine that.

Maybe because hyperinflation has absolutely nothing to do with government debt.

There is also absolutely no need for Japan to default on its debt regardless of interest rates.

a reply to: jimmyx
en.wikipedia.org...
It is the presidents budget and if congress doesn't give a lot of what he ask for he doesn't have to sign its called a veto. So in essence the debt it is both the congress and presidents fault. www.nationalpriorities.org...

originally posted by: dfnj2015
Maybe because hyperinflation has absolutely nothing to do with government debt.

There is also absolutely no need for Japan to default on its debt regardless of interest rates.

The people who have gone through hyperinflation including those in Zimbabwe and Germany know that a high government debt load does lead to hyperinflation in many cases, because hyperinflation actually does have a lot to do with government debt. Government debt is the most common reason a government will print excess money into circulation. Try a basic web search for Wiemar Republic inflation and get back to me on that one.
en.wikipedia.org...

The statement that Japan can pay any interest rate without a threat of default is contradictory to basic common sense. No economist OR math teacher OR finance industry worker will agree with you on that. You are totally reckless with your claims.

You can't take the last few months and project to it out over the next year or two. The rate of change fluctuates fairly rapidly. I did this for a few years making predictions and was almost always wrong. What I know with certainty is that we pretty well stabilized about 5 years ago now. We took on a lot of debt after the crash for a few years, and until the next one it'll probably not raise at any significant rate.

I mean it's pretty right in your face that this piece is propaganda. It's the first 45 days of a fiscal year. What happens is the clock stays stuck towards the end, the programs keep going, and then there's a jump as they catch up at the beginning of the fiscal year. This is either ignorance or propaganda.

originally posted by: fractal5

originally posted by: dfnj2015
Maybe because hyperinflation has absolutely nothing to do with government debt.

There is also absolutely no need for Japan to default on its debt regardless of interest rates.

The people who have gone through hyperinflation including those in Zimbabwe and Germany know that a high government debt load does lead to hyperinflation in many cases, because hyperinflation actually does have a lot to do with government debt. Government debt is the most common reason a government will print excess money into circulation. Try a basic web search for Wiemar Republic inflation and get back to me on that one.
en.wikipedia.org...

The statement that Japan can pay any interest rate without a threat of default is contradictory to basic common sense. No economist OR math teacher OR finance industry worker will agree with you on that. You are totally reckless with your claims.

Has Japan just lost a major war, owe it's debt in a foreign currency and just had its main industries seized by France? If not then the comparison with the Weimar Republic dosent really hold.

I didn't say that a Japan can pay any interest rate, I said a change in interest rate would not lead to default. Japan is sovereign issuer of its own currency it can issue debt at whatever interest rate it chooses to and even buy the debt itself. And before you worry about this being hyperinflationry this is largely what Japan has been doing for a number of years.

originally posted by: ScepticScot

originally posted by: fractal5

originally posted by: dfnj2015
Maybe because hyperinflation has absolutely nothing to do with government debt.

There is also absolutely no need for Japan to default on its debt regardless of interest rates.

The people who have gone through hyperinflation including those in Zimbabwe and Germany know that a high government debt load does lead to hyperinflation in many cases, because hyperinflation actually does have a lot to do with government debt. Government debt is the most common reason a government will print excess money into circulation. Try a basic web search for Wiemar Republic inflation and get back to me on that one.
en.wikipedia.org...

The statement that Japan can pay any interest rate without a threat of default is contradictory to basic common sense. No economist OR math teacher OR finance industry worker will agree with you on that. You are totally reckless with your claims.

Has Japan just lost a major war, owe it's debt in a foreign currency and just had its main industries seized by France? If not then the comparison with the Weimar Republic dosent really hold.

I didn't say that a Japan can pay any interest rate, I said a change in interest rate would not lead to default. Japan is sovereign issuer of its own currency it can issue debt at whatever interest rate it chooses to and even buy the debt itself. And before you worry about this being hyperinflationry this is largely what Japan has been doing for a number of years.

Hyperinflation is highly correlated with high government debt loads regardless of the nature of the spending. If Trump does increase the USA debt load, he puts the country at risk of hyperinflation. Zimbabwe had a very sharp spike to 140% about the same time hyperinflation was taking hold (source: Trading Economics website). Japan's 230% debt-GDP ratio mean the economy will almost certainly see hyperinflation at some point in the near future because of the correlation. Japan will print the money to pay off the debt, and then all hell will break lose. From my perspective only money velocity going down can be staving off hyperinflation in Japan, but the moment that velocity stop decreasing its over for Japan. I have not looked at their money velocity numbers but I'm willing to place a bet that velocity is going down. I seriously doubt any country has face a 200% ratio without hyperinflation though have not looked at the historical data to verify that.

I've read two different articles that both had experts saying Japan would be hard pressed to pay even 0.25% higher interest rate on its bonds without a debt default. However, I could not find the links. The only change in Japan bond interest rates that wouldn't lead to a collapse would be a decrease in interest rates.

originally posted by: fractal5

originally posted by: ScepticScot

originally posted by: fractal5

originally posted by: dfnj2015
Maybe because hyperinflation has absolutely nothing to do with government debt.

There is also absolutely no need for Japan to default on its debt regardless of interest rates.

The people who have gone through hyperinflation including those in Zimbabwe and Germany know that a high government debt load does lead to hyperinflation in many cases, because hyperinflation actually does have a lot to do with government debt. Government debt is the most common reason a government will print excess money into circulation. Try a basic web search for Wiemar Republic inflation and get back to me on that one.
en.wikipedia.org...

The statement that Japan can pay any interest rate without a threat of default is contradictory to basic common sense. No economist OR math teacher OR finance industry worker will agree with you on that. You are totally reckless with your claims.

Has Japan just lost a major war, owe it's debt in a foreign currency and just had its main industries seized by France? If not then the comparison with the Weimar Republic dosent really hold.

I didn't say that a Japan can pay any interest rate, I said a change in interest rate would not lead to default. Japan is sovereign issuer of its own currency it can issue debt at whatever interest rate it chooses to and even buy the debt itself. And before you worry about this being hyperinflationry this is largely what Japan has been doing for a number of years.

Hyperinflation is highly correlated with high government debt loads regardless of the nature of the spending. If Trump does increase the USA debt load, he puts the country at risk of hyperinflation. Zimbabwe had a very sharp spike to 140% about the same time hyperinflation was taking hold (source: Trading Economics website). Japan's 230% debt-GDP ratio mean the economy will almost certainly see hyperinflation at some point in the near future because of the correlation. Japan will print the money to pay off the debt, and then all hell will break lose. From my perspective only money velocity going down can be staving off hyperinflation in Japan, but the moment that velocity stop decreasing its over for Japan. I have not looked at their money velocity numbers but I'm willing to place a bet that velocity is going down. I seriously doubt any country has face a 200% ratio without hyperinflation though have not looked at the historical data to verify that.

I've read two different articles that both had experts saying Japan would be hard pressed to pay even 0.25% higher interest rate on its bonds without a debt default. However, I could not find the links. The only change in Japan bond interest rates that wouldn't lead to a collapse would be a decrease in interest rates.

If you are reading articles claiming a 0.25% increase in interest rates would lead to a default then I would suggest that you stop reading articles written by idiots. Japan has paid much higher rates before and not defaulted. It also ignores the rather important point that Japan can and does set its own interest rates and that as the issuer of its own currency it can not be made to default ( certainly not by a 0.25% increase).

The idea that a high debt to GDP ratio leads to hyperinflation inflation is rather at odds with reality as Japan has struggled with lack of demand and too low an inflation rate for years. It has been the outright policy of Japan to create more inflation in the system.

There is no direct correlation between high debt to GDP and hyperinflation (although countries with hyperinflation will normally have high debt levels the causation is pretty much the reverse of what you suggest). There is however a 100% correlation between countries experiencing hyperinflation having a major supply side shock.

originally posted by: ScepticScot

originally posted by: fractal5

originally posted by: ScepticScot

originally posted by: fractal5

originally posted by: dfnj2015
Maybe because hyperinflation has absolutely nothing to do with government debt.

There is also absolutely no need for Japan to default on its debt regardless of interest rates.

The people who have gone through hyperinflation including those in Zimbabwe and Germany know that a high government debt load does lead to hyperinflation in many cases, because hyperinflation actually does have a lot to do with government debt. Government debt is the most common reason a government will print excess money into circulation. Try a basic web search for Wiemar Republic inflation and get back to me on that one.
en.wikipedia.org...

The statement that Japan can pay any interest rate without a threat of default is contradictory to basic common sense. No economist OR math teacher OR finance industry worker will agree with you on that. You are totally reckless with your claims.

Has Japan just lost a major war, owe it's debt in a foreign currency and just had its main industries seized by France? If not then the comparison with the Weimar Republic dosent really hold.

I didn't say that a Japan can pay any interest rate, I said a change in interest rate would not lead to default. Japan is sovereign issuer of its own currency it can issue debt at whatever interest rate it chooses to and even buy the debt itself. And before you worry about this being hyperinflationry this is largely what Japan has been doing for a number of years.

Hyperinflation is highly correlated with high government debt loads regardless of the nature of the spending. If Trump does increase the USA debt load, he puts the country at risk of hyperinflation. Zimbabwe had a very sharp spike to 140% about the same time hyperinflation was taking hold (source: Trading Economics website). Japan's 230% debt-GDP ratio mean the economy will almost certainly see hyperinflation at some point in the near future because of the correlation. Japan will print the money to pay off the debt, and then all hell will break lose. From my perspective only money velocity going down can be staving off hyperinflation in Japan, but the moment that velocity stop decreasing its over for Japan. I have not looked at their money velocity numbers but I'm willing to place a bet that velocity is going down. I seriously doubt any country has face a 200% ratio without hyperinflation though have not looked at the historical data to verify that.

I've read two different articles that both had experts saying Japan would be hard pressed to pay even 0.25% higher interest rate on its bonds without a debt default. However, I could not find the links. The only change in Japan bond interest rates that wouldn't lead to a collapse would be a decrease in interest rates.

If you are reading articles claiming a 0.25% increase in interest rates would lead to a default then I would suggest that you stop reading articles written by idiots. Japan has paid much higher rates before and not defaulted. It also ignores the rather important point that Japan can and does set its own interest rates and that as the issuer of its own currency it can not be made to default ( certainly not by a 0.25% increase).

The idea that a high debt to GDP ratio leads to hyperinflation inflation is rather at odds with reality as Japan has struggled with lack of demand and too low an inflation rate for years. It has been the outright policy of Japan to create more inflation in the system.

There is no direct correlation between high debt to GDP and hyperinflation (although countries with hyperinflation will normally have high debt levels the causation is pretty much the reverse of what you suggest). There is however a 100% correlation between countries experiencing hyperinflation having a major supply side shock.

I just gave you the data on Zimbabwe that proving that their high debt load is correlated with their hyperinflation. As for Germany is that not common knowledge that they underwent hyperinflation with a high debt load? The data show hyperinflation and high debt are correlated.

You act as if Japan's ability to pay higher interest is some kind of debate. No, its financial math. There is a certain interest rate that a financial analyst can estimate would be beyond Japan's ability to pay. Its basic budgeting that a certain debt (interest) load WILL lead to a default fr any budget, and there are plenty of calculations to make such estimations. Unless you are a financial analyst, I'm going to believe the people who run numbers for a living. So far I have two analysts who crunched the numbers and say 0.25% is the most they can afford to pay in higher average bond interest, and you who who renders a snap guess with complete confidence that its better than the people who put all the time into running the numbers. My snap guess is 0.5%. If Japan's average interest climbed 0.5% the country would be done, like Greece. So I also question the 0.25% because I think its 0.5%.

And once again, the one and only reason Japan has not gone into hyperinflation is because their money velocity has been going down this whole time. It seems like some sort of mathematical guarantee that when velocity normalizes, inflation will be extremely high to exactly reflect the money supply changes that occurred. So the USA for example has typically a 5% increase in money supply, and that would in a flat money velocity have to result in inflation levels of 5% all else being equal. All else will never be equal but close enough to get a ballpark estimate of inflation.

If you double the money supply, prices double. There are exceptions like when money velocity changes but over time you are going to get one double in prices for every double of the money supply. This is my common sense but surely there is a named theory that says the same.