It looks like you're using an Ad Blocker.

Please white-list or disable AboveTopSecret.com in your ad-blocking tool.

Thank you.

 

Some features of ATS will be disabled while you continue to use an ad-blocker.

 

U.S. is Insolvent!

page: 1
0
<<   2 >>

log in

join
share:

posted on Dec, 19 2006 @ 09:02 PM
link   
"Prepare to be shocked.

The US is insolvent. There is simply no way for our national bills to be paid under current levels of taxation and promised benefits. Our combined federal deficits now total more than 400% of GDP."

Read the rest here news.goldseek.com...

The 800 lb gorilla of the economy is coming home to roost!
The table below says it all!



Between you and me and the fence post I've been buying alot of silver coins! Call me crazy, but I have felt less sure of the future than anytime in my life!:




posted on Dec, 19 2006 @ 09:17 PM
link   
400% of the GDP? I have to show scepticism on that one... It's the only article I saw up to now that says the US debt is that much

we'll see soon enough after our economic specialist get an eye on that



posted on Dec, 19 2006 @ 09:26 PM
link   
Unfortunately Mr. David Walker is too often ignored because no one wants to face up to the bad news! Mr. Walker is a U.S. Government Official and the report is his work!



posted on Dec, 19 2006 @ 09:28 PM
link   
By the way, looking at the Financial report, where exactly did he say 400% of the GDP?

Edit: Hold on, at page 31 he says the US have been doing better for the last ten years, does that mean they have been 400% of the GDP in debt for the last decenny?

[edit on 19-12-2006 by CanadianGlasnost]



posted on Dec, 19 2006 @ 09:34 PM
link   
His main argument is that using standard accounting practices that are used in the corporate world would lead one to the conclusion that the U.S. is going bankrupt. The biggest drag is the upcoming social security and medicare obligations that will overwhelm the budget if something is not done now.



posted on Dec, 19 2006 @ 09:34 PM
link   
I have for years wondered what the intention of the US Government has been in the long term to pay off its debt's. I have come to several conclusions of which the first being that it has no intentions to and would just point a carrier group in the general vicinity of any country/international banker consortium and say " Come and Get your Money !".

But just lately I have started to sway towards the good old "Change the Currency" trick that has happend for 1000's of years. its simple just swap the US dollar for say like 1 cent in the Amero Dollar. Then print a heap of Amero's as the new North American Currency and with the swap effectively wipe out all the old debt and remove the middle class in one foul sweep.

Thats 2 birds with one stone and the good ole USA is back in the post 1929 crash senario which in fact become the major driving force behind it becoming a world super power after undergoing hardship and toil to knit the nation together.



posted on Dec, 19 2006 @ 09:37 PM
link   
I keep hearing about the Amero will be introduced after the dollar collapse's!

I just keep buying silver and gold, hope the best, prepare for the worst!



posted on Dec, 19 2006 @ 09:42 PM
link   
Weird Mazzroth, why didnt they sweep the European middle class when they changed to the Euro?

And you must surely have a secret service working for you because, I didn't see concrete data leading to the creation of a north american currency, and I don't believe most banks do either?

Mel1962, yes I perfectly understood his main argument, but sorry if i repeat myself, I would like the exact area where he says 400% of the GDP... because at page 14 they make it look like it was more slightly under 40% of the GDP

In his conclusions he does say the US government needs to reform his priorities to sustain the economy, which is indeed normal. The same apply in my country I believe

As for the driving force behind becoming a superpower, nothing special actually... The US has many of the requirements to be a great power, a large population, a large territory, natural ressources, they went trough Industrialisation, they have a large military and a good technological level, it's logical they became a dominant power... The 1929 crash "helped" the US because it made them reform their politic about Laissez-Faire and found out Keynesianism is better, which actually... almost all nations have switched to

Otherwise, I don't really see your argument about 1929 being a "driving force" for the US to become a superpower?



posted on Dec, 19 2006 @ 09:51 PM
link   
This is ridiculous. The national debt is around $9 trillion and the GDP is about $12 trillion.

Under 100%, not 400%



posted on Dec, 19 2006 @ 09:57 PM
link   
That is what I also believe, I'd just like to know where he got his 400% in the article



posted on Dec, 19 2006 @ 10:11 PM
link   
Ok, that's look at this way.

You have a $9 trillion dollar debt, add an additional $44 trillion in long term social security and medicare obligations you than come up with a total of $53 trillion or about 400% of 12 trillion dollar GPD!

These are standard accounting practices used in business, if the U.S. government was a business it would be insolvent!

[edit on 19-12-2006 by mel1962]



posted on Dec, 19 2006 @ 10:22 PM
link   
Mel, there have been so many recessions, large unemployment rates, crises, panics, etc. in US history. Just before Regan took office, the US was supposed to crash due to the large unemployment rate and inflation taking hold.

We have economic problems. So does the EU, Japan, China and whatever else country you want to look at. Social Security will not crash the economy, there are ways to get the money, such as cutting costs in other areas.

Not that a recession will not occur in the near future (I suspect a worldwide one will occur at some point soon), but we won't all burn and die. So get off it.

P.S. ~It is trillions, not billions.



posted on Dec, 19 2006 @ 10:27 PM
link   
Thanks for the catch it is Trillion, but I still feel we are headed for a financial hard times and the eventual adoption of the Amero!

Just my paranoid thoughts! I listen too much to Lou Dobbs, Patriot Radio and few others!



[edit on 19-12-2006 by mel1962]



posted on Dec, 19 2006 @ 10:46 PM
link   

Originally posted by djohnsto77
This is ridiculous. The national debt is around $9 trillion and the GDP is about $12 trillion.

Under 100%, not 400%


When the article quotes national debt it includes the 9 trillion (8.916) of "Liabilities Net of Assets" aka "Assets Less Liabilities" or "(negative) net worth", but to the 8.916 trillion is added 44.147 trillion of "estimated current value of future expenditures under current law" aka "off balance sheet items" aka "social security".

So. As of today we owe 9 trillion. But we have PROMISED to pay out an an unfinanced annuity with a "net present value" of Negative 44.147 trillion in the form of social security.

Kind of like I owe Bob 9 dollars cash... and I have promised Sue 50 cents a week for a few years... starting 5 years from now. If I intend to come clean on what I owe Sue, I'd need 44 dollars in the bank right now collecting interest... but I got negative 9 (bob). Net real debt Negative 53.

Hence our debt is "better" estimated as 53 trillion, if we intend to pay the "already earned" social security that has been promised by law.

When we use the same methodolgy our debt was 20 trillion in 2000; representing... correct me if I am wrong... but 17.2% annual increase in debt (including social security) over 6 consecutive years.

The article also notes that the interest alone on this 53 trillion will place us an additional 3 trillion in debt in the upcoming year.

I'ts been a while since I've taken any accounting classes... so feel free to correct my errors.

Sri Oracle



posted on Dec, 19 2006 @ 10:55 PM
link   

Originally posted by Sri Oracle
The article also notes that the interest alone on this 53 trillion will place us an additional 3 trillion in debt in the upcoming year.


You don't pay interest on future payment obligations.

Anyway, the point that entitlement spending will soon break the bank is valid, but Congress will just have to at some point change the law and get rid of Social Security as we know it. There's no way higher taxes could ever pay the bill for the aging baby boomers, that would just kill our economy.



posted on Dec, 19 2006 @ 11:08 PM
link   
All of money has a time value. When we say something has a Net Present Value of 53 trillion we must attach an interest time stamp on that number. The author chose 5.8% (standard choice).

Therefore

Next year the 53 trillion net present debt will be 56.074.

True it is not interest exactly...


next year we’d have to put even more into this mythical interest bearing account simply because we didn’t collect any interest on money we didn’t put in the bank account this year. For the record, 5.7% on $53 trillion is a bit more than $3 trillion


Comprende?

Sri Oracle



posted on Dec, 19 2006 @ 11:30 PM
link   
That is just not true. If Joe owes Jane $20 payable on 1/1/2010 it will still be $20 no matter how interest rates have changed, inflation, etc. The "time value of money" really has nothing to do with this as rises in payments are indexed only to price indicies and tax revenue increases should at least match if not surpass that.



posted on Dec, 19 2006 @ 11:39 PM
link   

Originally posted by mel1962
The biggest drag is the upcoming social security and medicare obligations that will overwhelm the budget if something is not done now.


H5N1


It's a simple answer really, allow many of your 'unproductive' citizens to die off and let the rest pick up the slack.



posted on Dec, 20 2006 @ 01:29 AM
link   

Originally posted by djohnsto77
That is just not true. If Joe owes Jane $20 payable on 1/1/2010 it will still be $20 no matter how interest rates have changed, inflation, etc. The "time value of money" really has nothing to do with this as rises in payments are indexed only to price indicies and tax revenue increases should at least match if not surpass that.


If I owe Jane 20 dollars on 1/1/2010 , the "Net Present Value" is NOT negative 20 dollars.

Net present value (using 5.8) would be:

2010 20
2009 18.84
2008 17.74
2007 16.71
2006 15.75

If I owe Jane 20 dollars on 1/1/2010 and the long term interest rate is 5.8 the Net Present Value of that debt is only $15.75. Managerial Finance 101.

So... if I had $15.75 in my interest bearing (5.8%) savings account today, I would be in position to pay Jane 20 dollars come 1/1/2010.

But If i do not have 15.75 in my interest bearing account as of the end of the year, I would need to have $16.71 magically appear in 2007 for it to grow in time to be worth the 20 I owe her in 2010.

Are you with me now?

If we had positive NPV 44 trillion in our social security account today we would be in position to pay what is due in the future assuming it grew at 5.8% annually.

We have negative 9 trillion.

So next year we will be that much closer to our SS obligations being due.

And we will NOT have collected interest on the 44 trillion we are supposed to have on hand, because on hand we're at -9. So now we owe the 44 trillion that was due last year PLUS the intesest we were supposed to earn on that 44 trillion that would have made it grow (one year's worth) towards the necessary total future value due.

53 becomes 56

Sri Oracle



posted on Dec, 20 2006 @ 01:38 AM
link   
Your problem is thinking in a closed system where you need the money in the bank now to pay a future bill.

But that's not the case, tax revenues will rise along with inflation rates negating any difference in the time value of money now and in the future in this special case.




top topics



 
0
<<   2 >>

log in

join