us debt clock
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pucho812
Well-known member
So is the one for California
pucho812
Well-known member
kambo said:
yes notice how fast it is moving...
Thanks for noticing... Historically our government only borrows like this during wars. There does not seem to be even a shred of fiscal (spending) discipline. It is difficult to grasp numbers that large, so the $80k per person, or $200k per taxpayer offers some perspective, but still that is hard to take seriously.kambo said:
An popular benchmark to compare health of a country's economy is debt as a fraction of GDP. Only 20 years ago our debt was 56% of GDP, now it is 136% .
Note: that graph is just a prediction out into the future but I do not see any evidence of the trend reversing. Right now the two parties are only arguing about how much more to borrow.
Another factor not being considered is that we are now enjoying record low interest rates, the burden of servicing all that debt could easily double or triple if we returned to historic interest rates. It is hard to imagine a soft landing, which may be why everybody keeps postponing the day of reckoning into the future.
But as A.E. Newman would say "What me worry"?
JR
PS: I have cautioned before that we have never returned to relative normalcy after the 2007/2008 crash. We can see a definite uptrend in debt beginning then (and unrelated to any war).
living sounds
Well-known member
Meanwhile inequality is skyrocketing. 30 million Americans are receiving unemployment benefits while the rich are getting richer at an even faster pace.
That steep decline in debt after WW2 was thanks to high taxes on the wealthy and economic growth spurred by government investment in basic research and technology that the private sector converted into productivity increases.
In addition to the government debt there is consumer debt. The bottom half of Americans combined have a negative net worth. The 80k$ per person doesn't even factor in this calculation.
What all of this means is that there are a few people and corporations who hold most of the debt and the rest who owe it to them, one way or another.
A delaveraging phase is imminent, and it won't be pretty. This will affect the whole world. Similar problems to the US exist in the other developed countries, though inquality isn't as extreme in most of them.
On top of that there is foreign indebtedness, of which both the US and EU countries owe massive sums...
I'm increasingly putting money into cryptocurrencies to hedge against inflation and even collapse...
That steep decline in debt after WW2 was thanks to high taxes on the wealthy and economic growth spurred by government investment in basic research and technology that the private sector converted into productivity increases.
In addition to the government debt there is consumer debt. The bottom half of Americans combined have a negative net worth. The 80k$ per person doesn't even factor in this calculation.
What all of this means is that there are a few people and corporations who hold most of the debt and the rest who owe it to them, one way or another.
A delaveraging phase is imminent, and it won't be pretty. This will affect the whole world. Similar problems to the US exist in the other developed countries, though inquality isn't as extreme in most of them.
On top of that there is foreign indebtedness, of which both the US and EU countries owe massive sums...
I'm increasingly putting money into cryptocurrencies to hedge against inflation and even collapse...
living sounds said:
what exactly will you be spending when global power problem accrued due "sun spots" and/or major hacking,
there was a major fault in system recently with bitcoin, and people wouldnt be able to access to their account, even if they did,
it was "0" zero . and bitcoin went down over $1,000.00 instantly! picked up again, but some left big time !
living sounds
Well-known member
kambo said:
There's no free lunch and no risk free investment or even commodity.
If electricity went out on the entire globe we would have bigger problems than currency anyway. And you wouldn't be able to access your stocks or ATM either.
I'm certainly not advising to put everything in cryptocurrencies, especially not just in one coin. But owning some of it might come in very handy if inflation goes through the roof and/or the economies loose faith in their fiat currencies. It has happened before, and usually in times like these when debt was at a peak...
I tend to watch markets as predictive about future economic health. The market is arguably over bought (too high) no doubt fueled by excessive liquidity, and a new generation of (robin hood) day traders who never saw the market go down (warning markets always go up "and" down.) The market is past due for a correction.
My recent observation is a case of good news being bad news. The market (investors) want to see another massive stimulus spending bill. The recent better than expected jobs number last week and economy slowly improving, is reducing the justification for more, large stimulus.
Congress is back from from their summer break, so they are about to start arguing again about how much more to borrow.
===
If I was younger I might own a token position in crypto currency, but it still looks more like a fad with a good back story, than a robust store of value. Who or what is backing bitcoin? I remain a huge fan of blockchain technology but, crypto currency not so much. I still like fintech (financial technology) like square and paypal.
My recent purchase of Silver is already up 16%, my much older investment in gold is only up 10%.... Technically these are not investments because they don't generate any dividend income or growth, but are considered inflation hedges.
====
I am not sure what the debt clock has to do with wealth distribution, or fairness. Irresponsible borrowing will make us all poorer.
JR
My recent observation is a case of good news being bad news. The market (investors) want to see another massive stimulus spending bill. The recent better than expected jobs number last week and economy slowly improving, is reducing the justification for more, large stimulus.
Congress is back from from their summer break, so they are about to start arguing again about how much more to borrow.
===
If I was younger I might own a token position in crypto currency, but it still looks more like a fad with a good back story, than a robust store of value. Who or what is backing bitcoin? I remain a huge fan of blockchain technology but, crypto currency not so much. I still like fintech (financial technology) like square and paypal.
My recent purchase of Silver is already up 16%, my much older investment in gold is only up 10%.... Technically these are not investments because they don't generate any dividend income or growth, but are considered inflation hedges.
====
I am not sure what the debt clock has to do with wealth distribution, or fairness. Irresponsible borrowing will make us all poorer.
JR
living sounds
Well-known member
JohnRoberts said:
We've been there before, rising debt is indicative of more than "irresponsible borrowing", mainly an inadequate feedback mechanism for redistribution. Otherwise, in a capitalist economy, the system automatically drifts towards asymmetry, which leads to instability.
"Fairness" is not an economic but an emotional metric. But perceived unfairness does add to the instability of the system, as is evidenced by the rise of populist agitators now and throughout history.
https://www.forbes.com/sites/jackkelly/2019/10/11/for-the-first-time-in-history-us-billionaires-paid-a-lower-tax-rates-than-the-working-class-what-we-should-do-about-it/
https://www.epi.org/publication/top-charts-of-2018-twelve-charts-that-show-how-policy-could-reduce-inequality-but-is-making-it-worse-instead/
https://www.cnbc.com/2018/10/31/billionaire-douglas-dursts-solution-to-national-debt-raise-my-taxes.html
I haven't been here before, Marx and Engle wrote their manifesto in something like 1850. But class warfare has been widely used to foment revolution. It is kind of a chicken and the egg argument about whether revolution causes class warfare or class warfare causes revolution.living sounds said:
thank you,,, fairness is not an objective metric.. Perceived unfairness is the founding principle of identity politics.
I still find it instructive that billionaires do not just donate all their billions to government, but create their own charities to use it more effectively to benefit the greater good.
JR
iturnknobs
Well-known member
Ditto. The volatility is quite nerve-racking at times. Hopefully the right thing to do as far as diversification is concerned. LINK and YFI have been crazy.living sounds said:
Matador
Well-known member
"more effectively" is not an objective metric.JohnRoberts said:
I'm not sure why it's instructive in the slightest: there is a massive financial (tax) incentive to steer charitable contributions to private entities versus general taxation of income.
living sounds
Well-known member
This just in:
https://www.theguardian.com/society/2020/sep/08/how-philanthropy-benefits-the-super-rich
https://www.theguardian.com/society/2020/sep/08/how-philanthropy-benefits-the-super-rich
How about with less waste and fraud than government spending. That seems objective enough.Matador said:
A popular screed is that we can fund all our government spending desires by using government force to simply tax the wealthy more aggressively to pay their "fair" (cough) share. An income tax deduction for charitable spending is not significant to people with Bill Gates, or Warren Buffett money, who have accumulated that wealth over decades of hard work. They do care about how that money gets used to make the world better after they die. Some uber wealthy have so much wealth they must start giving it away before they die. If these smartest people in most rooms thought that government was an honest broker for using that wealth for good they would gladly just sign it over. The fact that they don't seems pretty instructive to me.
===
CA who has always led the nation in taxation, is now talking about clawing back wealth from residents who move to other states to escape California's excessive taxation.
JR
Gates bought a product that someone else created and licensed it to another company. That's hard work! I bet he had callouses on his hands after that one!JohnRoberts said:
And don't forget that your prime examples Gates and Buffett have actually spoken out in favor of inheritance taxes, and Buffett has spoken about the inequity of low capital gains taxes vs. higher income taxes.
living sounds
Well-known member
Bill Gates was lucky to be the right person at the right place and time. He should be well rewarded for his hard work and innovation. But he would be fine if he had 10 billion instead of 100 billion.
And think about that: All of Microsofts products are based on taxpayer sponsored basic research. Governments have less and less money to spend on this kind of research, because it accumulates with people like Bill Gates. This does negatively impact future growth.
I recommended this book before but am happy to do it again:
https://en.wikipedia.org/wiki/The_Entrepreneurial_State
And everything a company like Microsoft can do relies on a functioning infrastructure, an education system, legal system etc. On a functioning society, no less.
Apart from that, even from a purely systematic perspective an economy cannot function well if most of the gains go to the top. Henry Ford understood that, and thus made sure his workers were able to buy his cars. An economy is a circuit with work and goods sloshing around. As most circuits, it requires an equilibirum.
And think about that: All of Microsofts products are based on taxpayer sponsored basic research. Governments have less and less money to spend on this kind of research, because it accumulates with people like Bill Gates. This does negatively impact future growth.
I recommended this book before but am happy to do it again:
https://en.wikipedia.org/wiki/The_Entrepreneurial_State
And everything a company like Microsoft can do relies on a functioning infrastructure, an education system, legal system etc. On a functioning society, no less.
Apart from that, even from a purely systematic perspective an economy cannot function well if most of the gains go to the top. Henry Ford understood that, and thus made sure his workers were able to buy his cars. An economy is a circuit with work and goods sloshing around. As most circuits, it requires an equilibirum.
Sorry I didn't mean to trigger y'all.
I try to follow economics, and while not exactly a hard science because it deals in human behavior (in response to incentives, or disincentives) I noticed something interesting over the last several weeks. Instead of the sky crashing down upon us several weeks ago when the congress could not negotiate an extension to the $600 a week unemployment benefit, instead we magically got higher than predicted employment numbers. 8)
An economist might suggest that when the $600 a week "dis-incentive" to hold a job dried up, workers went back to work. ;D
Of course maybe it is just a coincidence. :
===
Congress better hurry up and negotiate the new stimulus bill, or the problem may resolve by itself. Right now the two sides are not very close... The senate is talking a pretty huge $350B bill to support testing and covid related issues (another round of stimulus checks are off the table.) The house is calling that $350B "anemic" :, and demanding $3.5T to prop up mismanaged states.
JR
PS: I already responded to those old talking points.
I try to follow economics, and while not exactly a hard science because it deals in human behavior (in response to incentives, or disincentives) I noticed something interesting over the last several weeks. Instead of the sky crashing down upon us several weeks ago when the congress could not negotiate an extension to the $600 a week unemployment benefit, instead we magically got higher than predicted employment numbers. 8)
An economist might suggest that when the $600 a week "dis-incentive" to hold a job dried up, workers went back to work. ;D
Of course maybe it is just a coincidence. :
===
Congress better hurry up and negotiate the new stimulus bill, or the problem may resolve by itself. Right now the two sides are not very close... The senate is talking a pretty huge $350B bill to support testing and covid related issues (another round of stimulus checks are off the table.) The house is calling that $350B "anemic" :
, and demanding $3.5T to prop up mismanaged states.JR
PS: I already responded to those old talking points.
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