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National Debt Clock Overflowed, Extended By a Digit
hackingbear writes "The National Debt Counter, erected in 1989 when the US debt was 'merely' a tiny $2.7 trillion, has been moving so much that it recently ran out of digits to display the ballooning figure: $10,150,603,734,720, or roughly $10.2 trillion, as of Saturday afternoon. To accommodate the extra '1,' the clock was hacked: the '1' from "$10.2" has been moved left to the LCD square once occupied solely by the digital dollar sign. A non-digital, improvised dollar sign has been pasted next to the '1.' It will be replaced in 2009 with a new clock able to track debt up to a quadrillion dollars, which is a '1' followed by 15 zeros. That should be good enough for a few more months at least, I believe." Adds reader MarkusQ, "I know Dick Cheney has assured us that 'Deficits don't matter' but I can't help wondering if we should be fixing the problem rather than the sign."
before another digit is needed yet again
FOXTROT UNIFORM CHARLIE KILO
Deficits don't matter. All that matters is that your dogs are bigger and meaner than the debt collectors'.
WWJD.... for a Klondike bar?
The largest bit became a one? It overflowed?
So now it's negative?
We're rich! So that's how we were going to pay for the bail-out, SS, medicare, medicaid...
Comment forecast: Bits of genius surrounded by a sea of mediocrity.
Looks like we need to print more money
I think I understand now...eventually we're going to get to the point where no computer will be able to track how high the debt gets...and it will simply rollover and the US economy is back, baby!
Why don't they just make it an analog clock? The hands could simply spin around faster and faster as the situation worsens, which would be much more amusing. The numbers are fairly meaningless anyway.
This is the second debt clock. The first version could only count upward, and when the budget had a surplus back in the Clinton years, and the debt began to decrease, the debt clock was shut down. After a year or so, it was then replaced with the current version, which has the ability to count both upward and downward. The downward capability has not been used during the Bush years.
I'm sure they can borrow a "1" from a gas station.
It's true, you know. A $10,000,000,000,000 national debt is an embarrassment, whereas $9,000,000,000,000 is not.
"Adds reader MarkusQ, "I know Dick Cheney has assured us that 'Deficits don't matter' but I can't help wondering if we should be fixing the problem rather than the sign."
But if we did that then we couldn't have a neat story about a "hacked" clock.
Perhaps they can get a new model that displays the debt in scientific notation -- it could be named the "Cheney Memorial Clock".
First of all, 2.7 in 1989 are worth more than the same amount in 2007. Inflation calculator says 2.7 trillion in 1989 equal 4.6 trillion in 2008.
Secondly, what's really important is the debt-per-capita ratio, and the US population has increased. In 1989 the US population was 246 million; in 2008, it's 305 million.
That means, that in 2008 dollars equivalent, the per-capita debt in 1989 was $18,000, while in 2008, the per capita debt is $32,000.
Yes, we do owe more. But we "only", per capita and in equivalent monetary value, owe about 80% more, as opposed to 370% more, as the original numbers would make you believe.
For 2007, the Bulletin of the Atomic Scientists listed the U.S. with about 5,400 total nuclear warheads.
So that means each warhead is worth about $1,879,741,432 each.
How we know is more important than what we know.
It has the makings of a civil war.
Engineering is the art of compromise.
It is not an extra '1-comma', just an extra '1' because the comma goes after the '0', not the '1'.
Adds reader MarkusQ, "I know Dick Cheney has assured us that 'Deficits don't matter' [CC] but I can't help wondering if we should be fixing the problem rather than the sign."
Why does this guy hate America so much?
"Information wants to be expensive" - Stewart Brand, the same guy who said "Information wants to be free"
Now is the perfect time to convert to the decimal system!
National debt goes from $10.2 trillion to only $10.2 billion (10^6) without paying a single cent of it!
Be very, very careful what you put into that head, because you will never, ever get it out. - Cardinal Wolsey
OMG the dollar sign is static... it's the end of the world!!!!
Has no one learned from Y2K? We keep running out of digits for everything because people can't plan ahead. McDonnalds ran out of digits on their signs counting the number of burgers sold. They hit 99 billion served not too long ago and have been replacing their signs with just "Billions and Billions served" I don't think anyone cares any more about the total.
Many gas stations in Canada only have enough digits to display 99.9 cents/L when last year gas soared over $1.30 /L. Many stations have been buying new signs just to display the extra digit.
Now the The National Debt Counter had to be modified. Doesn't any one plan ahead for this stuff or do they just wait for stuff to break and then go fix it because now they have to?
"It's symbolic," Stauber, a 40-year-old pilot from Switzerland, said of the counter's lack of space. "It's a very big symbol. It's a complete failure of the system. It's the most powerful country in the world with a conservative government for the last eight years, and it's running the biggest debt ever."
Just because Bush claims to be a conservative doesn't mean he actually is one!
The US has an incredibly interventionist foreign policy, and Americans haven't experienced a free market for almost a century. I'd like to echo Jim Rogers, and say that all we've seen lately is socialism.
Consider repaying $1000/month on your credit card. For many people that might be hardship. For most people, repaying $2000/month is not 2 times as hard, butmuch harder.
Similarly, repaying $18k per person is a lot easier than repaying $32k, by much more than a factor of 2.
Of course that's all academic since nobody seems to be planning on repaying this debt.
Engineering is the art of compromise.
I remember when the debt hit 1 trillion dollars in the early 80's. All the talk about how a trillion dollar bills would stack to the moon 3 times over, or something like that. I remember a Johnny Carson monologue where he said, "if you have 1 trillion chicken McNuggets you could reconstruct 3 chickens" :)
I remember that being the first time I every really started worrying about it. I figured its ok, they'll get it under control sooner or later. Well here we are about 25 years later, the only time it has looked like it might be under control was during Clinton's second term. This is really getting ridiculous, the over the last 25-30 years the vast increases have come under the "conservative" Republicans. We have to get this under control or it will eventually destroy our Country.
So hear I am again, really worrying this time, but I figured its ok, they'll get it under control sooner or later.
If you could reason with religious people, there would be no religious people
My prediction: By 2013 National Debt will = GDP
Total US 2007 GDP: $13.78 trillion
The reason the debt clock has this problem is because it is sensationalistic and does not give us any real information. What we should be looking at is not the debt, but the debt in relation to some other metric, such as multiple of median income, amount per person, percentage of GDP. Using this later metric, Reagan left us with a debt of about 70% of GDP, Bush will leave us with a debt of 80% of GDP, while Clinton left us with a debt of about 60% of GDP. It is interesting to think that Truman, Ike, Kennedy and even Nixon, all worked to help the US future by reducing the % debt. We even have to give carter so kudos for not increasing it as a % of GDP. The scary thing is that during the great depression GDP fell perhaps 20 or 25%. If this happened in the next few years, our GDP might fall to 9.5 trillion, and we might see a national debt of 110% of GDP. This would be like a family with the median of $50,000 having unsecured debt of $55,0000. How they would pay this off would be extremely unclear.
"She's a scientist and a lesbian. She's not going to let it slide." Orphan Black
The neo-cons have ran America into the ground. At this time, about 98% of our entire debt is entirely reagan and W.. I can only hope that Obama will do the right things.
God save America, because the neo-cons have not.
I'm sure they can borrow a "1" from a gas station.
Actually I was thinking that they could put a glass window in the sign and have Ron Paul stand in for the "1".
Take the cheese to sickbay, the doctor should see it as soon as possible - B'Elanna Torres, "Learning Curve"
this is old news
he who controls the spice controls the universe
10,150,603,734,720.00 (decimal) = 93,B5F,213,EC0.00 (hex)
Whoever came up with the idea of buying a new LCD clock should be fired for wastefulness.
Display the count in binary and you're all set!
When Michael Larson was on the mid-1980's game show, "Press Your Luck", the scoreboard only held 5 digits and a dollar sign. When Michael broke the $100,000 barrier, they removed the dollar sign to accommodate the next digit. Sounds exactly like what happened here, except the national debt is no game show.
We should sell Hawaii to Saudi Arabia. That ought to be worth at least 10 trillion. Problem solved.
The debt clock gives a per family portion. ~$86k. Compare that with the median income. Whoo!
I often wonder if we/USA like to make fun of problems and the people that are willing to work on them. After all, its not like this problem is effecting us, right? So why care? We can laugh some more right!?! We can play the blame game too. LAUGH...LAUGH After all who would call in this debt, and how would they force us to pay? Laugh..Laugh...
Lets put more people into office that will help increase it, because we really are going to take the time out to figure who will help fix this country and who will not. However, that really is not an easy task, but are these questions really getting asked or are the people running for office not giving enough details to determine which plan will work?
It is sad to be USA citizen in this day and age.
What "fiscal conservatives"!
But wait, the debt has grown insanely under every single Republican president in the last 40 years.
How could that be?
The Republicans aren't fiscally conservative at all. Every single republican president has spent like a drunken sailor and GWB is the worst of the lot.
The only thing more stupid than Tax and Spend is Spend and Spend.
"There are laws that enslave men, and laws that set them free. " - Sean Connery as King Arthur
'tis from the other side of the world!
If you spend a lot on your administration, to win over voters or do whatever it is you want, then when the Democrat gets into office, he or she will be forced to cut spending so as to create a surplus while keeping the Republican's low taxes, lest they get "tax hike" backlash. At the same time, whenever "starve the beast" fails, deficits don't matter, or deficits are the grease that keeps the gears of the economy going.
Republican politicians like McCain say we're supposed to reduce spending, (in order to reduce national debt, though this step on the flowchart may be skipped depending on the audience), and we also should reduce taxes further, but then how will we get rid of the national debt?
Furthermore, if the Republicans are to perpetually starve the beast and fail, clearly their strategy needs to change. They need to raise deficits so much that the interest itself is as burdensome as the current deficit levels by themselves. That, and if the Republicans are perpetually starving the beast, maybe they should at least be doing so with programs like national healthc----oh, wait.
The preferred method of starving the beast is through increases in the national defense budget, it would seem. John McCain has expressed need for a spending freeze in all areas but that, which would cut off funding for new NASA projects (which aren't entitlements, including Orion, which was approved in a separate bill), while his close colleague Lindsey Graham wants to cut the budget by 5% in all areas but national defense.
Wow! I hoped it would never come to this, but I guess I have to move to China! Even if we never touch the principal, the interest alone is enough that the US likely won't get ahead.
At the same time, both Federal and State governments seem to be putting a lot of their eggs in one basket, so to speak, by "taxing the rich". I believe (Cost of Government) / (Number of Citizens) = the fair tax per citizen. Anything else is unfair, but necessary simply because not everyone can afford their fair share.
Why not? Because, the "Cost of Government" is too large compared to "the fair tax".
What we have today, is that a relatively small percent of the "top earners" pay 90% of the taxes. The problem with that is when things get tough, the rich get hit worse, in the pocketbook. (duh, the poor, have no money.)
Don't get me wrong, when things get bad, the poor are physically worse off - out on the streets, going hungry... bad stuff at a basic level. But when the "rich" get hit, not only do they not buy that new BWM, they pay less in taxes. This leads to a vicious cycle of politicians whining that "we need more taxes" to cover the shortfall...
I think I saw somewhere that NYC alone, was going to be short BILLIONS in tax revenues because a few thousand "Wall Street" tax payers aren't doing so hot this year.
Likewise, California is driving many of its "rich" citizens out of the state, to the benefit of places like Nevada and Texas, who have no personal income tax.
The way the political system is set up today, the problem is not getting better. The same overspending politicians get re-elected over and over. So, what would fix the problem?
Legally, only constitutional amendments. So, what should they be? Term limits, hard spending limits (% of GDP), a requirement to justify spending bills by having them cite constitutional authority to do so? What about an entirely new branch of government as an extra check and balance - like a non-political DRAFTED body that has veto power over any law? (E.g. something like a grand jury to oversee the various legislatures. Except rather than selecting from random registered voters, select from random people who have actually paid taxes, per their tax return.)
I don't know... just looking for real ideas for constitutional amendments to address the structural problems, not a flame ware. Things are polarized enough - the defacto two party system that is entrenched is part of the problem in and of itself.
If I owe you a hundred dollars, I have a problem.
If I owe you a hundred billion dollars, you have a problem.
-fb Everything not expressly forbidden is now mandatory.
Is there a live webcam of the debt clock anywhere?
:-)
I checked Google and just came up with a bunch of Flash versions of the clock and a million hits on this same story from a week ago..
as one of the 1 in 10 Americans in a crippling debt crisis... shouldn't it be our goal to fix the growing debt problem rather than erect a even bigger shrine to the dollar sign?
Actually the debt realtive to the GDP went down which is all that matters.
Some drink at the fountain of knowledge. Others just gargle.
It's hard to tell for certain, but it looks like the clock may be constructed with LED technology, not the LCD tech described in the article.
Please continue to force Fannie & Freddie an sue our banks into giving bad loans.
I can see it now
American debt: B-u-f-f-e-r-o-v-e-r-f-l-o-w
I'm a god hating, baby aborting, marx reading liberal.
Deficits don't matter. Rather, the existence of a deficit doesn't. Having a deficit and a debt we CAN PAY BACK is a GOOD thing. It means our credit rating is great and that we can extend ourselves in times of crises and be a financial powerhouse in the world.
however, when we're struggling to pay our principle much less the interest, then that's a different story all together.
Non impediti ratione cogitationus.
The counter, on West 44th Street near Sixth Avenue, is more visible to those walking west; for those walking east, the sign is already behind them once they walk by the building.
Imagine that. The clock is behind you after you walk past it. Who knew?
Write your own Choose Your Own Adventure. http://www.freegameengines.org/gamebook-engine/
Just switch the clock over to a hexadecimal display.. problem solved!
That's the Bush administrations answer to everything though, isn't it? "Just add another zero... let the next guy figure it out..."
Microsoft - The best ad campaign Apple ever had.
My father in law once told me the debt is like a mortage. Being my father in law I didn't correct him, but here...hey it's the internet.
A mortage usually grows in value and you also are paying part of the principal. Neither seems to be true with the debt. I suppose the GDP does grow and with inflation, but I think that's a bit different.
Last time I checked the interest payments on our debt where over 400 billion. That coming close to our highest budgetary item...our defense.
At our current rate our interest payments will be our highest payment. Something we can't even cut. This is like a credit card with your minimum payment being higher then you can even afford.
We have to raise taxes on someone. Sorry to the right wingers...but it can't be helped. We have to pay our way out of this. Even with drastic spending cuts we still have to. The cold hard facts are we have to do both. I'm not a politician, so I can say this. Time we start to listen to reason and not what make us feel good here in the U.S.
Imagine what we could do with that 400 billion every year. It's time to bring it down even if it means a few years of less then average growth. It's time to start thinking about our children. Not in some "make me feel better about my self" fashion, but just in general. I think in the long run it is what's best.
If USA owes this foolish amount of money, but no-one dares to ask for it back because of the military and economic power - then USA effectively owns the world, and might as well just declare itself debt free, and carry on living off the backs of its slaves.
The rest of us aren't going to do anything about it.
For every expert, there is an equal and opposite expert. - Arthur C. Clarke
One man's debt is another man's pension fund. Most US debt is held by funds, so I tend to agree with Cheney. The fact is that money is only real when you want to buy bread and milk at 7-11. in truly huge amounts it is just a number in a computer and doesn't really matter.
Excuse me, but please get off my Pennisetum Clandestinum, eh!
If a successful college education is worth so little as you claim, that means you're producing too many of them.
Same problem the world over, though.
I know Dick Cheney has assured us that 'Deficits don't matter'
Good so I can keep the house I can't pay for?
realkiwi
"Of course since the debt is growing and growing it takes a bigger clock to measure it each time. Thus solving the problem once and for all!"
Adds reader MarkusQ, "I know Dick Cheney has assured us that 'Deficits don't matter' but I can't help wondering if we should be fixing the problem rather than the sign."
Yes, because devoting the resources expended to fix the sign to eliminating the national debt would have solved the problem.
"The clock was put up by the late real estate mogul Seymour Durst in 1989 "
'cause you know, it's the Durst Institute that's responsible for the debt, not a bunch of irresponsible politicians...
If a job's not worth doing, it's not worth doing right.
We should be fixing the problem. All we need to do is cut spending and increase taxes.
I, for one, wish you luck getting elected on this platform.
Yep, inflation is the key. If we crank it up say 10 000%, than one day may coin jar will be worth more than the national dept.
We should quit counting the debt. We'll just put it down as "Trillions and Trillions owed"! Genius! :)
It's not enough to bash in heads, you've got to bash in minds. - Captain Hammer
It's not that simple.
1. For a start, it would work that way if the USA were the only market in the world. I do believe that China can also sell to Europe, or to its own damn citizens. I don't think the Chinese would revolt if they could buy good computers instead of exporting them.
The USA survived pretty well by selling its best stuff locally instead of exporting it all, didn't it?
Anyway, the USA has, what, 5% of the world's population? There's a whole other 95% who could buy that stuff.
2. Whatever advantage there may be in selling to the USA, would disappear overnight if the USA decided not to pay, which is (I believe) what the GP was getting at. The whole deficit scheme is, basically, borrowing money from those countries in exchange for their products. If the USA decided to just pocket some trillions of dollars overnight, on the justification that, basically, "our dogs are bigger than the tax collectors'", it would find itself a much less attractive market. Equally overnight.
3. The whole lopsided market situation exists because countries are made to export their raw materials for cents and have to buy high-tech stuff for thousands of dollars. Or, ridiculously enough, lately manufacture that high-tech stuff themselves in their own sweatshops, sell it to themselves, and send the profits to some overseas corporation.
Basically think: you want new shoes. So I send you my permit to raise your own pig, slaughter it yourself, tan its skin, and make your own gloves. Only now you have to pay me for the gloves. I'll even pay you back a few cents for the leather, 'cause that's raw materials and dirt cheap, and charge you lots for the gloves.
And you can't just say "fuck you, buddy" because there are some international treaties and that forbid you from using my patented design and my "Le Moraelin Haute Couture" label. Oh, and to add insult to injury, you designed that design for me too, but I patented it, 'cause I'm the big international corporation with teh moneyz.
And while for gloves that's just a matter of being a fashion victim, for a lot of other stuff it's less black and white.
That's the shit end of the imperialism stick, that those countries get. Mostly because we, the western world, promise to give them a black eye one way or another, if they don't abide by that kind of an arrangement.
Far from being some kind of great help that China would be foolish to cut off, it's a very disadvantageous system for China and a lot of other countries. If they threw it off, their economy wouldn't implode, and their standard of living would go up overnight. Again, they have a billion of their own people to sell that stuff to, instead of selling it to 300 million foreigners. Other than an artifficial financial and trade system imposed on them saying that it's better to sell to an American than to 4 Chinese, there is no real reason why that is so.
_If_ the western world decided to just plunder the existing debts, that might just be the excuse they're waiting for, to get out of that system.
A polar bear is a cartesian bear after a coordinate transform.
I think analogies are great, because they can be such effective argumentative tools. The other great thing about them is that they can be awfully misleading, because they'll trigger all sorts of unrelated or inappropriate (to the actual argument) intuitions.
Keep in mind that the relationship between a taxpayer, a country, and the government is much more complicated than that between a patron, a bar, and a barkeeper.
First off, I don't consider myself a "customer" of the US government. In my opinion, this isn't how a citizen-government relationship should work.
Next, it's misleading to use beer as the analogous good for government services. We can safely consider beer to be some kind of luxury good, and not a necessity. But what the government provides is in most cases very necessary for us. Water or food or shelter might have been more appropriate here.
This is related to my third point, which is that the richest man in the group can't opt out so easily. Setting up shop in another country isn't as easy as going to another bar, nor will you get the same beer in one place as the next.
And finally, our individual prosperity is in large part dependent on the system and opportunities either created by or opened up by the government. A drinker and his bartender don't have that sort of dynamic, sadly.
Perhaps there are some truths to your argument, but I don't like this analogy at all.
As an Australian I can only Marvel at America's national debt. You've all given up on the hope of ever paying it off, which is simply astounding.
If your money is created from nothing at the point of a loan and you want to inflate the money supply then you also have to increase the (exponentially growing) debt at the same time.
Now, if you want the "economy" to grow then clearly you have to increase the supply of money faster than the interest on the debt which is consuming credit, or you get a recession.
Whether the debt is public debt, private debt or corporate debt, is irrelevant. The debt must be created. Or at least, it will be until you run out of people willing or able to take on and service the debt, then the system collapses. Doesn't this requirement for perpetual growth sound like something else?
It is a predictable exponential function and therefore has a doubling time, so yes, you could create a "law" about it.
The national debt, the credit crunch, the stockmarket crisis are all the inevitable result of the way your money is created... Long may it continue.
Deleted
Is anyone else, like me, making plans to move out of the US? Frankly I didn't get us into this mess and I'm not willing to do my part to bail out all those who did. I'm a liberal, not a libertarian, so I don't think taxes are always bad, but when I hear about what they're going to be going to, well I'd rather be paying taxes someplace where they're going to do some good. I hear european countries have high taxes, but they're not sending it all to Wall street, Iraq, and the world's largest military. I'd rather pay twice the taxes I am now if I knew it was going to more worthwhile things, like studying bear DNA.
I have no skill when it comes to convincing people of anything, especially not the average voter. I come across as arrogant, elitist, and condescending, because I am arrogant, elitist, and condescending, and that doesn't convince them of anything other than they don't like me. I give money to different causes to do that, but I myself am not helping my fellow citizen make the right choices.
While I like the place and the people, we've really painted ourselves into a corner. Every other country on earth makes stupid moves, because every person on earth is occasionally stupid, but the US keeps making such BIG mistakes. I feel selfish, or rather, I realize I'm selfish, but I'm not doing any good here, country is going to hell in a handbasket no matter what I do. I'm here for several more years in any event, so I guess there is time for us to shape up, but I'm making new plans anyway. Anyone else?
"A bit of history: in the mid 1980s, Ronald Reagan came into office with the idea to slash income taxes, particularly for people who were "important" to the economy, i.e., very wealthy."
The wealthy are important to the economy. The wealthy and the upper-Middle class business owners are the engine of American prosperity. How many poor people ever offered you a job?
So let's cut this bullshit right now that wealthy = villain.
"At the time there was some belief on the Republican side that cutting taxes would magically produce new economic activity that would pay for the reduced tax cuts. Unfortunately, that never really happened and the nation started to go deep into debt."
Except that increased economic activity did "pay for" the tax cuts. The problem is that Congress increased spending by huge amounts, negating any savings, especially increases in entitlements which, by law cannot be touched during budget cuts. To this day, the biggest item in our budget is not defense (which is one of the few things the Constitution explicitly says should be paid for by taxation), but those damned entitlements. And when the Baby boomers start their retirement peak, we're going to be in a world of crap that makes the current crisis look tame.
Life is hard, and the world is cruel
It really irks me that people keep mentioning the same facts over and over again. Everyone knows how FRB works. Everyone knows they printed money. Everyone who is going to know knows. So why are you wasting brain power trying to educate people when you could be coming up with solutions.
I saw I story today about Iceland. You may or may not know that Iceland is a sort of banking haven for Europe. Anyway, they bought up a lot of these bad securities based on loans that may or may not currently be bad. Anyway, the story mentioned that the depositors from England and Germany and Europe are coming and wanting their money from the Icelandic banks and they don't have any. And it ended with "poor Iceland, what will they do now that their economy has collapsed"?
It's this type of stupid story that the media JUST LOVE to splatter about. They don't understand that they are CAUSING the mess. Guess what? NOTHING HAS CHANGED IN ICELAND. The farmer still grows his stuff. The geothermal energy is still coming from the ground. The snow is still white and cold. Nothing is different except the assumed value of a few sheets of paper.
Likewise, in America and world-wide, nothing REAL has changed. Yes, there are shysters who make money off confidence, and they are suffering right now. Oh, who's this guy Henry Paulson? The FORMER CEO of Goldman Sachs you idiots! But in reality, we are all still going to work, still producing the little amount of stuff we produce in this country. But we produce everything we need to exist, food, housing, medicine. So, again, I ask, what's the problem? If I'm hungry, can I get food? Yes. If I need a place to stay, is there one? Yes. If I'm sick is there a hospital mandated by law to provide care for me? Yes. So, what's the problem?
Buy local and DO NOT buy gold, since you can't buy food with gold. You can, in very bad times, buy gold with food :) So yes, if they weren't already speculated to record highs by people who saw this whole thing coming 18 months ago, buy commodities. Hell, REAL ESTATE is a great investment right now. If you have cash.. Some lucky asshole is going to swipe all those houses up from the banks. It might even be the U.S. government. And you know, they overpay for EVERYTHING, so if you buy some now, you will see an immediate appreciation. Anyway, these are not bad times if you are smart and not stupid and buy into their stupid panic stories. If you are seriously worried about feeding your family you shouldn't have GAMBLED IT AWAY on stocks.
Cool! Amazing Toys.
Two words which American politicians should be particularly worried about; "Chinese consumer". When you hear those two words on American news, you know that China is going to be asking itself what America is good for. At the moment, tens of trillions in IOUs.
e.g.
http://query.nytimes.com/gst/fullpage.html?res=9F02E1DA133CF937A25751C1A9659C8B63
Deleted
"Giving the super wealthy more money is not socialism."
So now confiscating less of their earnings is now "giving them money"? What kind of Marxist bullshit is that?
If you want to make the case for so-called "progressive" taxation, fine, but drop this shitty notion that it's the government's money in the first place. It's not. Money is property, and last time I checked, we still have property rights in this country.
Life is hard, and the world is cruel
There are 10^11 stars in the galaxy. That used to be a huge number. But it's only a hundred billion. It's less than the national deficit! We used to call them astronomical numbers. Now we should call them economical numbers."
- Richard Feynman
The cool things is to have windows that bounce up and down like a good tits.
have Ron Paul stand in for the "1"
Why did I read that as Ron Jeremy ?
Incidentally, the top people in China's government are all engineers. This includes Hu Jintao (General Secretary and the top guy), Wen Jiabao, and, previously, Jiang Zemin.
Heh. Nobody is arguing that, but that's exactly the crap artifficial system that other countries are forced to adhere to... even when it's against their interests.
The thing is, money is just an abstraction to make the system work smoother. Go back to reading even, say, Adam Smith: the "wealth" of a nation is measured by how well the goods it gets match the needs and desires of its citizens. That's why you live better in the USA than they do in China. You get some of China's goods too, to match _your_ needs.
That system actually does very little for China, though. They get to export some goods to match _your_ needs instead of using them to match their own citizens' needs, i.e., instead of raising their own standard of living.
Even then, it would be a fair trade if they used the dollars they get, to buy things they need more. But the whole trade defficit scheme means they don't. In that relationship, the USA gets more and China gets some IOUs. As in, "I Owe You goods worth this many dollars." If the rest of the world actually tried to cash in those trillions of dollars, the value of the dollar would go down by an order of magnitude or more. Because you just don't produce the goods they could buy with them.
But in the mean time, that market doesn't work like Adam Smith and the free market apologists thought. Instead of being a mechanism by which China gives away stuff its citizens don't need more, and gets stuff they actually need, it's a mechanism by which China gets some IOUs instead of matching its own citizens' needs. As the wealth of nations go, China gets impoverished by that system.
And if, as the GGP was getting at, the USA decided it can ignore the IOUs because its dogs are bigger than the tax collectors', essentially you'd tell the whole world that USA's IOUs are worth nothing. They'd be a lot less inclined to sell you for more worthless IOUs in the future.
But even that lopsided trade is already based on some artifficial conventions that we, the western world, imposed upon those countries. In a lot of cases the goods they "import" to give those dollars back, are produced locally in China. But they must pay a foreign corporation a "tax" on goods produced in China and sold in China. We created an artifficial situation which _causes_ the western markets to be artifficially wealthier. We decided that the goods China has are low worth, ours are high worth, and China can't produce ours unless it's for one of our corporations. Then they can import their own product and pay us a tax for it.
To use a more classic economics example, the whole trade and market theory is based on the following idea: if England is better for producing wool, and France is better for producing wine, then the sane thing to do is raise sheep in England and grapes in France, then trade them. And the money and merchants' greed would be a mechanism for figuring out the exchange rate and making sure each country gets something closer to what its citizens want.
But now imagine a system where we artifficially decided that wine is cheap, wool is expensive, and France is outright forbidden to raise sheep except if it's for an English lord. 'Cause England patented sheep. Well, _of_ _course_ then the English market would be wealthier than the French one. But it's only due to an artifficial system which pumps resources out of France and makes them pay even for sheep their own shepherds raise.
It's a hypothetical example, France would have never bowed to that kind of conditions, but it's not entirely hypothetical for other goods and countries: That's exactly the thing that, say, IP conventions _do_ to poorer countries. They can only produce raw materials, they have to import computers from us. Even if they know how to make a computer, even if the fabs are on their land and staffed by local workers, and even if the damned design team who designed the CPU or chipset are their own people in their own countries. But they can't actually produce it for themselves. They have to beg, say, _Intel_ to build tha
A polar bear is a cartesian bear after a coordinate transform.
Everybody loves to blame Republicans! But you need to realise both parties are at fault here. And by both parties, I mean mostly the Democrats.
Take a look at some legislation during the Clinton years. Look what he did! He created... some stuff, that ... ruined our economy. Yes! Clinton, and all those other Democrats played their (foundational) part in causing this crisis of debt! The surplus that his administration ran was... well, misleading. In fact, Bush's deficit was in fact, when you think about it, a net contributor to the national surplus.
Both sides have caused problems here. Just look at legislation passed by the current Democratic controlled Congress. It's driving us under! OK, Republicans made some mistakes during their tenure, but it's clear from the fact that things are still bad, that the Democrats are not doing anything to fix the problem! I mean, the Republicans didn't leave that big of a mess behind them!
So just remember that no matter what the topic, there are two sides to every issue, and "Both Sides" are at fault. Equally. It's the basis of modern debate. Especially the fact about Republicans being less at fault.
May the Maths Be with you!
There seem to be many well qualified people here who can answer my simple question which is:-
What's the difference between Governments guaranteeing deposits in banks, and Governments simply printing more money and giving it away to said banks?
To my simplistic mind which, I agree, has an abysmal knowledge of matters financial, both actions look horribly similar. There is the exception that the guarantee bit uses a mass of double-talking high-tech voodoo to hide the truth of the matter from "the masses", i.e. ordinary hard-working folks who make up the majority of the world's human population.
Do please answer the question, because to me this whole worldwide financial collapse looks like the biggest international corporate fraud since the Fall of Rome. Convince me it isn't.
Better dead than red!
Confucius say, "Find worm in apple - bad. Find half a worm - worse."
You pay for the SS with "goods harvested" from the concentration camps.
Come on! Its Nazism 101.
Mit der Dummheit kämpfen Götter selbst vergebens
That analogy is absolutely ridiculous. The rich man is not a goose who poops golden eggs and shares them out of kindness. The rich man's wealth is where everyone else's is: In the bar.
When ten men go to a bar, the first five clock in and start working. The next four buy their own drinks. And the tenth gets a free beer because he owns the place. If ANY of them stop going to the bar, the musical chairs just shuffle around, until there are too few people left to operate a bar. And then it closes. And no more rich man.
You talk as though the rich are the lynchpin of capitalism. They're not; they're a byproduct, and in many cases a sign of inefficiency or poor regulation. The middle class are the lynchpin of capitalism. And they have been slowly disappearing into WalMart, CostCo, and the military industrial complex for the last 25 years. Have you noticed that the steps are getting a bit narrow on your ivory tower?
This always boggles my mind.
Ok now it's at 10 tril. 5 years from now, 25 tril. 50 years from now, 200 tril. Perhaps the curve is slowing down and we says in the newspaper, wow it's slowing down.
100 years from now 450 tril.
I understand there must be a negative effect to the country to be with a deficit. There's constant struggle to balance the money, etc. But what I am getting at is, it doesn't really end.
1000 years from now 2 quad.
And the world spins the same way, we have the same old Oh Henry. When I look at the scale of this thing, from a layman POV (the only POV I have in the finance side of things), I don't see the effect of a deficit.
I am sure there is an effect, but my limited life span does not let me appreciate it.
Anyone shed some light?
Hurry up, get old, collect Social Security and die. That's your only escape.
If you think this mortgage meltdown is bad, you ain't seen nothin'. Want to know what the world will look like after the $35 trillion Social Security / Medicare shortfall kicks in? Probably more like the 1st half of the 20th Century than the 2nd half.
Research shows that 67% of those who use the term "research shows", are just making shit up.
It's important to have goals.
My ism, it's full of beliefs.
They don't NEED the money, so the loss is worthless. But they gain massively.
1) Education. Being a large investor in a company, that company becomes MUCH more profitable if the workers are educated, so your child gets 10% more effective and 5% more pay. The owners of the 1,000 strong workforce get 5,000% more pay.
2) Defence. If you have five large homes and a lot of land you have much more to lose on invasion or attack than someone who rents from a slumlord.
3) Police. You have much more to lose in a robbery and you're a much more effective target. A poor person who loses their car has lost their car. It may turn up burned if joyriders took it. The CEO of IBM when he loses his car gets a prime line to the police force.
4) Spare money can be loaned. A poor person cannot afford a home but may be able to afford a mortgage. The mortgage is money from a rich person who didn't need the money. And that mortgage is returning a far higher rate than any possible savings.
An plenty more ways.
The rich get much more for their money spent on taxes.
And that would be if they didn't weasel out of every penny possible.
Open a tax haven account when you have a grand. Now try when you have a million. One'll get you in the door, the other one will either get nowhere or the bank costs are more than the taxes avoided.
First, if they want to stick with their "tax" scheme, they should all pay the same proportion of the total, or 80% of what they were paying before.
Second, in the real world, the poor are not making out with a sweet deal, getting free beer while the rich are shouldering their burden. I don't know for sure, but I imagine it sucks living in poverty.
It can't be a joke because nobody makes jokes about number bases, ever[1]. So it must be a plot by the man to keep us all confused. Yes, that's it.
[1] OK, there's a first time for everything. What if you couldn't balance your checkbook and you realised you were trying to do ity in octal.
Confucius say, "Find worm in apple - bad. Find half a worm - worse."
That's odd. When I try spending more than what I have, my city improvements start disappearing.
Are these guys using cheats?
It's not exactly "borrowing" when the people you're borrowing from (future generations) don't have a choice, and you have no intention of paying them back. So I would call the Republican model "Steal and Spend" since you're taking the tax money of people who can't vote yet and therefore have no say in how their money is spent. It's taxation without representation at its very worst.
...and you're wrong. As usually the case, take the opposite of the wingnut viewpoint and you have reality.
The wealthy are important to the economy. The wealthy and the upper-Middle class business owners are the engine of American prosperity. How many poor people ever offered you a job?
The rich don't create jobs, demand does. What creates the most demand? Having a large middle class with disposable income.
So let's cut this bullshit right now that wealthy = villain.
Let's cut the straw man. The problem isn't that people hate the rich, the problem is that our economy funnels all it's benefits to the rich.
Except that increased economic activity did "pay for" the tax cuts.
In the entire history of this planet, there has never been a single income tax cut for employers that has increased economic activity. Not one. If a business owner will make more money by expanding his business, he'll expand the business and write off the expense on his taxes. His personal tax rate is irrelevant. Where tax cuts do stimulate the economy and increase demand is by giving them to the middle class so they have more disposable income.
To this day, the biggest item in our budget is not defense (which is one of the few things the Constitution explicitly says should be paid for by taxation), but those damned entitlements.
Nonsense. All those entitlements go straight back into the economy at the base level, where it's most needed. What's blown our budgets are huge tax cuts for the wealthy and continuing to fund our military like we're on the verge of World War III. We're surrounded by two large, peaceful, friendly nations and the world's two largest oceans. Our actually defense needs are pretty damned small.
To this day, the biggest item in our budget is not defense (which is one of the few things the Constitution explicitly says should be paid for by taxation)
The problem with taking a strict interpretation of General Welfare is that you would have to take an equally strict interpretation of Common Defense. So if Social Security is unconstitutional, so are the CIA, the NSA, NORAD, the USAF, and spy satellites. But you never see wingnuts whine about the unconstitutionality of the U.S. Air Force, but they do whine about Social Security. It's almost like they're picking and choosing what government programs they're objecting to, sort of like how the NRA opposes Democrats on gun control yet Republicans who support gun control, like George W. Bush and Rudy Giuliani, get a complete pass. Huh, interesting.
Wow, some of the armchair economists in this thread should go get into government, they clearly have a complete and total handle on the intricacies of all national economies. Most impressive. No more than a few days in office will clearly have them properly handling debt and economy. Thank you for your enlightening opinions!
Just another ignorant American.
Well except for your whole premise that the US doesn't have a manufacturing base is false. Globalization can mean everything from a product made entirely in one country and imported here. e.g. bananas all the way to subcomponents made elsewhere and assembled here. And that's ignoring the products made completely here and exported elsewhere.
"Yes, but the GDP is bullshit. It makes societal harms into positives (Hurrican Gabby hits and causes $5 BILLION damage, that ADDS to the GDP). Another common scenario is a foreign car bought in the US at a dealership, because the transaction is in the US, it, again, adds to the GDP."
The first adds because someone has to go in and repair all that both in materials and labor. The second because the US gets a cut of the total. Not to once again mention that some foreign cars are made HERE (Honda) even though the corporate owners are foreign.
...when they could have just let it roll over to -$9,999,999,999? That's what I call surplus!
I'd think that the nerds here would know the difference between the deficit and the debt, but apparently not. They both involve the federal government of the US's indebtedness, and they both start with "d", but they're not the same thing.
The deficit is how much more we've spent in a year than we have. The deficit adds to the national debt.
The debt (the national debt) is how much we owe as a nation - the whole pile.
One of the first hits on Google said the CBO pegged the 2008 deficit at $219 billion US (probably not correct anyomre). The debt-clock is overflowing into the $10 trillions. That should give you an idea of the difference between the terms you're tossing around.
The deficit and the debt are not the same thing any more than the sales tax and the purchase price are the same thing.
How brave of you.
Seems more like the tenth guy got his bartender buddy to reduce his tab even though it put the bar's owner into debt.
No, you're not. Plagiarism is bad enough. Plagiarism combined with false attribution and impersonation ought to be prosecuted as slander.
Why the hell is a piece of idiocy like the parent modded to +5? Is it just a matter of "Yeah, stick it to the man, woo hoo"?
You seem to be trying to argue that even though the wealthy pay most of the taxes, they consume an even more disproportionate share of government resources. Are you referring to Social Security, or Medicare, or Defense? Those are the items that account for the largest share of the budget, and I don't see how any of them could be considered to be disproportionately directed to the wealthy.
The GP is exactly on the money with verifiable data.
If you think it is bad for our society to have such disparity between the "haves" and the "have-nots", fine, I have no problem with that.
But it's rubbish to call a tax reduction "a giveaway to the wealthy". If you reduce taxes, of course those who pay the most taxes are going to be affected (benefited) most, while those who pay little or no taxes will hardly be affected at all.
Wealth disparity in this country is not a result of the rich not paying enough taxes. The rich pretty much foot the bill for government as it is. Even if the top tenth of the population paid all of the nation's taxes (instead of "only" 59%), and the lower nine-tenths paid nothing, we would still have basically the same disparity between the rich and poor.
Exactly. Whenever I see an anti-tax diatribe from a "fiscal conservative", I wonder where they think the government gets the money to spend on all of the conservatives' pet programs. They can spend and spend and spend, but when the government hands them their bill it's called "stealing". At least liberals generally have the integrity (and perhaps patriotism?) to pay for their own spending.
The debt is not growing exponentially...
Sure it is.
http://en.wikipedia.org/wiki/Image:US_Federal_Debt(gross).JPG
In fact, I'm about 90% sure it's exponential. It sure fits an exponential curve well. averaging about 7% growth. With percentage growth the doubling time is 100*ln(2)/percent. So at 7% it would be doubling every 10 years.
And just as a check...
1980 909,041
1990 should be double that:
1990 3,206,290
Yikes, even higher than 7%
2000 5,628,700
That's more like it. A fraction under 7%.
It's predictable. I predict with about 90% certainty that the national debt will grow at 7% per year and therefore doubles every 10 years. There you go. "Colin's Law". Though I would like to thank my high school science teachers for an introduction to exponential functions.
Even Excel can do the analysis for you. The function you need is "logest".
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1+15 digits ? That's short-sighted. They should just use a full-resolution display with scalable fonts :)
-Billco, Fnarg.com
Which is why the Chinese economy is stronger.
Nonsense. China's "growth" is subsidized by government loans to government-owned companies, an enormous amount of which are under-performing or non-performing. It's a ponzi scheme, and sooner or later it collapses. It will make the subprime crisis look like a deck chair on the Titanic. One of the few things that keeps China afloat is the influx of cash and credit from the US. To suggest they don't need us is ludicrous.
And of course China doesn't have to dump them in the ocean, they can sell them to their own people - who will be much richer than Americans once their currency stops being artificially surpressed.
Are you crazy? 70% of China's population are pre-industrial agrarian people who live in poverty by any measure.
Slashdot "libertarians": Small government for me, big government for those I disagree with. -1, I disagree with you
"I know Dick Cheney has assured us that 'Deficits don't matter' ..."
Tell that to Iceland. Not so long ago, Iceland was a rich country. Recently, the country has become unable to pay its debts, and its currency has quickly lost its value. Now, banks have stopped trading in Iceland krona, which means the money has essentially become worthless. And that means that if all you have is Icelandic kronur, you will have a very hard time paying for things. I don't think Iceland is a rich country anymore. Now, tell me again why deficits don't matter?
Please correct me if I got my facts wrong.
According to David Walker, US Comptroller General says that the debt clock does not count the $40 trillion that's off the balance sheet. So we are in the whole for about $56 trillion. $480K per household.
I don't know if you realize it or not, but you're a part of that very "upper class tax bracket" as described by, well, everyone.
When anyone talks about "the rich getting tax breaks," they're specifically referring to you.
You do realize that the majority of us only make 40-60K a year, right?
That's a bullshit analogy, because that pub is not an economy. In that pub, those men bring some money from the outside, and the pub is just a sink for it.
In a real economy, it doesn't work that way. That tenth guy, for example, isn't someone who shits his own gold coins and injects them in the economy, but someone who got a disproportionately large slice of the pie we're all producing. He isn't _producing_ $59 out of nowhere. The money is just an IOU for how much of the pie you're allowed to take. And somehow he's entitled to take more for per hour he put in.
If you want a more apt analogy, think not a pub and someone producing money out of nowhere to pay your beer. Think, say, a semi-closed medieval economy, and chipping in to maintain the roads they trade along:
- the first four men are the serfs. They do most of the actual work, and it's their grain that gets exported along those roads. In fact, they actually build the road too during the few months when they're not working the fields. They barely get a subsistence meal (and the 10th and 9th guy would have a fit if these could afford a beer), but don't get asked to pay any extra money. They paid their due in producing that crop that the others apropriated and sold.
- the fifth guy is the village guard, tax man and toll collector rolled in one, and doubles as the master's footman in case of a war too. He gets paid a pittance for his work, but gets taxed 1 florin (to use an apropriate medieval currency) for it, for road maintenance.
- the sixth guy is the miller. He actually gets to keep a share of the grain milled at his mill, but gets taxed 3 florins. He still makes a good living out of that arrangement.
- the seventh guy is the smith. He makes everything from horseshoes to ploughshares to the tenth guy's armour. He doesn't own his work either, 'cause the baron owns his smithy and gets the lion's share. But he gets a fair pay for it, even if he has to pay 7 florins right back as taxes. Still, his ore and coal come along that road, so he can understand paying to maintain that infrastructure.
- the eigth guy is the baron's scribe and clerk. He commands a high price because he's so smart. He gets paid a heck of a lot more than those serfs, and can even afford some minor luxuries. But, he also gets taxed 12 florins, or about a third of his nominal wage. He complains about it a lot, even though he's still left with more than the smith had before taxes. He thinks that a fair tax would be if everyone paid 10 florins, including the serfs who are already kept at at subsistence level and don't make that much in the first place.
- the ninth guy is the merchant who goes off to sell the grain and some of the smith's product once a year, to the nearest trade centre. He not only makes a fortune, but since he controls the baron's money supply, he can get almost any laws and concessions to swing his way. He gets to pay 18 florins for his income, and that annoys him no end. Why, he's the guy who makes money, while those serfs only get paid. They should pay him, not tax him, is what he keeps saying.
- the tenth guy is the baron. He gets the lion's share, regardless of whether that little village actually makes a profit or not. (A recent story on The Register comes to mind, about a CEO getting paid 74 million when the company _lost_ billions.) Due to imperial regulations, he has to pay 59 florins imperial tax for road maintenance and policing. He likes to act as if he produced that money by shitting gold, and someone is robbing him at gun point if he has to pay for the infrastructure that made him money. He pays astroturfers like David R. Kamerschen to spin him as if he were minting his own money and injecting money in the system, instead of as the guy who gets to plunder it the hardest.
And when the emperor decides to reduce that tax to 80 florins? Well, everyone is still working the same. Those serfs are still the ones actually feeding everyone else and doing most of the hard work, but they get nothing out of it. They're
A polar bear is a cartesian bear after a coordinate transform.
Basically enormous deficits like the US has, means low interest rates and high inflation for the foreseeable future.
You must remember we live in a time of historically low interest rates, which was one of the things which allowed the Clinton administration (along with restrained spending) to pay down the debt.
If interest rates were to rise, the Federal Deficit would skyrocket in interest payments. Therefore they have a great need to keep interest rates low, thus allowing inflation to run rampant.
I believe the US is beyond ever getting a balanced budget, until it finds itself in a financial quagmire, much like the Japanese government is in.
You'll have to enlighten me.
How will severely reducing the monetary supply send the US into a hyper-inflationary period?
It's been a long time.
Why didn't I think of that! With a negative debt, we're effectively rolling in cash. Next we just need to switch our currency to the negabuck, 1 Nb = -$1.
The average American doesn't have the balls to fix the problem. Half of America thinks that increasing taxes and increasing government responsibility for our personal issues is the solution... If we really cared about fiscal responsibility we would require American's to be fiscally responsible as individuals - rather than giving every fool who fails to provide for himself and family regular and on going handouts. Bob Barr for president!
See: http://davidk.myweb.uga.edu/
And I hardly doubt it came from an economist.
It used to be that the GNP meant something...this country could produce enough goods and services to cover our debt...
Well, no longer. We should only spend what we have to spend, not debt, but actual "income" or the tax money that the government collects (tariffs, etc).
Projected income = budgeted spending. The remainder or "actual" is either a surplus or deficit, and you fix that for the next budget...
Well...there is no way in hell we are paying off the national debt...you may as well borrow and spend, because it really doesn't matter.
Inflation will now go unchecked, our dollar will fall, and our economy will fail. This road has been chosen, and we must simply accept that fact.
--E--
that ~35% is federal only, we also pay state taxes (0-10% income tax). Some may pay additional city income taxes.
Add in property tax (gotta fund the schools, we do afterall spend more on schools than the military minus iraq) and it adds up a bit higher.
Bring back the old version of slashdot.
Comment removed based on user account deletion
Parent speaks the truth. I demand my government be run for free!
I'm not commenting about the deficit being super high or the fact that corruption does exist inside the government. I'm just saying that I think the parent is wack-job.
Parent starts at -1 karma on my end, but I see no problem with this comment and see no issue with modding it up rightly.
You will recall that an old Louie lost his head after the debt of France's monarch topped 80% of France's GDP. U.S. gross domestic output is about $13 trillion - and falling. This puts the national debt at 77% of GDP...and rising fast.
Swedish Meatball
Who seriously thinks we are going to pay back all the national debt?
I don't. I'm convinced at some point during the next war everybody (govs of countries) will say "Screw you" and default on all the loans they took out.
Which is why I say that in the U.S. we should be taking out ALL the loans we can from anybody overseas that will give em. Then build large physical items that can't be repo'd. Take out a HUGE loan to fix all the roads and bridges, buy that concrete wall across the border, get a couple dozen aircraft carriers. What are the Chinese going to do when we don't pay? Come and get it sucker!
Of course I'm joking....kinda...
i heard that pretty soon we'll need to add another digit to the CEO pay counter too.
I wish that I had done what I liked years ago (Internet, WWW, Linux) instead of what I was supposed to do.
What you say may be true for FEDERAL spending, but as I am sure you are well aware, k-12 and public colleges are funded by mostly by property and state income taxes.
http://www.ed.gov/about/overview/fed/10facts/index.html
We spent over $500 billion in 03/04 on education. In FY2008 the US government spent 515 billion dollars.
http://en.wikipedia.org/wiki/Military_budget_of_the_United_States
Check the facts, you have (like most people) confused federal and local spending on these issues (not counting iraq the overall education spending throughout the US is roughly simliar to military spending).
Stupid? I think when viewed in the context of overall spending my comments are accurate.
Bring back the old version of slashdot.
Would be great if they added a large LED color display that would plot the national debt growth based on historical data.
Starting with 1989, show everyone a graph that displays how much the debt grew until now, month by month. Of course given the digital nature, it should be possible to show other data as well.
The benefit to this would be to show for example "How much did it grow under Bush #1, Clinton, Bush #2, Whoever's next"
If you're less than ten years away from retiring, then you should have your saving in a simple interest bank account. No stocks. That way a crash won't devalue your money.
What do you do when the government prints a trillion dollars? Or 1.5 trillion dollars? The reserve ratio in the USA is about 10:1.
The number of little bits of green paper you have may well increase, but they can half in value if the supply of money keeps increasing. That's as big a crash in value as the stock market.
http://news.bbc.co.uk/2/hi/business/7509715.stm
The truth is that there is no such thing as safe, or stable. Someone will always try to find a way to take it away from you. Particularly bankers. The nature of a fractional reserve means that all such banks take deposits, lend out 90% of it and only hold 10% in case of customers demanding money. Well, if there are any problems and people decide to remove their cash (Washington Mutual), only the first 10% get their money, everyone else loses out. Sure there are insurance schemes and guarantees, but a pension fund needs to be very large so only a fraction will be guaranteed.
I recommend you learn about money, understand how it is manipulated by banks and governments, how it affects stock markets etc. Then take active steps to protect yourself from them all.
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I hope you realize that China and the USA are in a willy-waving contest as to which has the larger surface. They're just about equal. And, oh, look, Canada is bigger than both.
So, do you propose to split the USA and Canada up? After al, you just told me that running a country that big as a Federation is slopply and not recommended. :P
A polar bear is a cartesian bear after a coordinate transform.
When you can turns the tables and start dictating the terms?
China will no more "cut off all exports" than the U.S. did, and for the same reason - as China owns more and more of the U.S. business interests and government debt, they will call more and more of the shots. (See IMF for precedent).
It will be a great irony to watch America suffer the same fate they've inflicted on other countries - an economy that runs to the dictates of outsiders for outsider's benefit.
My name is Aaron James WE HAVE AN URGENT MESSAGE TO ALL ABOUT U.S.TYRANNY THREATENING OUR LIVES-AND some reflections on The National Debt as pertains to the false war on terror: The National debt, in part can be blamed on the false war on terror- THE U.S. IS TRYING TO MURDER MY MOTHER AND I CURRENTLY-Government is embarrassed over our online exposure we had at http://aaronjamesstory.com/ and GOVERNMENT JUST ATTACKED/ DOWNED OUR WEBSITE and removed it from archive.org as well! They had my name up on FBI.gov in falsified demeaning account -they removed the entry on the same day Oct6/08 just a few days prior-This is being done to erase ALL record of their intent towards our harm online. I just received a death threat on my youtube.com account at ajames1000 today reading "someone's got to die for our rights and freedoms-why not this guy" They have attempted our murders multiple times now.(some Important links at bottom) ***Most recent abduction attempt VIDEO WITNESSED http://www.youtube.com/watch?v=_sfObgs3GGg*** WE HAVE STUDIED THE FALSE WAR ON TERROR CLOSELY AFTER WE WERE ORIGINALLY PROFILED AND ATTACKED/LEFT IN POOL OF BLOOD ON AIRCRAFT-You don't know about or story- as Americans YOU MUST KNOW and propagate awareness because these same draconian mechanisms are now being used stealthily on ALL of us. Please read on. 1 trillion dollars into Iraq alone to this date, McCain singing about bombing Iran and Bush/Cheney capitalizing off of death and carnage in Afghanistan Iraq and Georgia-all rich with oil, popyseed (for opium/ illegal drug trade resource). The president of Afghanistan is now Khalid Kharzai- a U.S./ CIA asset and former senior financial adviser to Unocal, one of the largest oil companies in the East. U.S. economy is based on those three things in general. The National debt and financial ruin, the bailout- these are things that are MEANT to foster social decadence, because in a state of decadence and decay, the groundwork is laid for the steady removal and erosion of civil rights and liberties unto the progression towards martial law and globalization. MY MOTHER AND I ARE BEING TARGETED BY THE FALSE WAR ON TERROR AGENDA-The False War on Terror- an AIPEC/ U.S. *Government/ Israeli *Government initiative, (does not reflect on Israeli *people or *Jews in any way to be VERY clear.) Victims of the false war on terror are enumerate and it is an afflictive entity which is affecting many-and now targets my mother and I! Winnipeg police have committed 14 attempts upon our lives towards kidnapping us from Canada to torture in the U.S. My family and I -Canadian citizens-are suffering and her health deteriorates!! -we live daily in terror b/c of Bush regime related persecution and relentless attempts upon our lives! After a barbaric U.S. Northwest Airlines profiling attack upon my mother and I, we are victim of the North American Union "harmonizing of the peripheries 'Homeland Security'" effect/related tyranny and the ongoing violations of the 4th and 1st amendments (U.S.)against the human rights and liberties of all through the exploitation of the false opportunistic "War on Terror" mechanism that targets the American and Canadian citizen as terrorists in blatant paradox and hypocrisy against the original touted edifice of the 'War on Terror' in that currently through a covert and illegal juncture of U.S. and Canadian government, and as attest to the covert North American Union agenda, the U.S. is attempting to effect the murders and/or kidnapping of my mother and I to the U.S./ torture in retaliation for our exposure of Minneapolis's and Northwest Airlines' racial profiling attack upon us-Canadian citizens- on our 3 day trip to the United States in seek of medical consult at the Mayo Clinic. (21blacks:1 white imprisoned in MN Council on Crime and Justice declares Hennepin judiciary corrupt with "collusion between prosecution and judges to effect of targeting victims of police brutality blacks and the poor." Local
Japan owns 600 billion of US Treasury Securities, and China owns 500 billion.
Why? Japan wants to export it's deflation problem via the carry trade which is when Japanese Yen savings are used to buy Dollars which are then used to buy US Treasury Securities which yield higher interest than Japanese banks must pay to Japanese savers.
The US loves this because buying dollars with yen supports the US dollar keeping inflation down, while the Fed 'stimulates the economy' with loose monetary policy. Meanwhile Japanese exports are helped by devaluing the Yen. Japan must devalue the Yen for it's exports to be competitive with China.
China devalues the Renminbi ( Yuan ) by more complicated means, but like Japan, the result is accumulated Foreign Currency Reserves, including US Treasury Securities. Devaluing the Renminbi ( Yuan ) makes Chinese exports more competitive. Also, the restrictions on foreign investment necessary for China to control the value of the Renminbi ( Yuan ) allow some measure of central government control in how the Chinese economy develops.
Moreover, devaluing the Renminbi ( Yuan ) allows China to accumulate huge foreign currency reserves ( 2 trillion dollars worth so far ) that it can use for checkbook diplomacy, such as loaning to the third world or deals with Hugo Chavez or the Iranians.
It is worth noting that the Foreign Currency Reserves are aquired by the Chinese Government at the expense of the average Chinese citizen. The buying power of the Renminbi ( Yuan ) that the average Chinese worker is paid in has been appropriated by their government by their artificial devaluation of the Chinese Currency.
Not that there is any moral difference between that and a tax.
Anyway, if one of Japan or China started selling US Treasury securities they would shoot themselves in the foot. It would likely trigger a fire sale that would wreck the dollar and hurt the US, China, and Japan severely.
However, there has to be balanced trade sometime. Pressure will build and build until it inexorably happens somehow.
Here is a link you might find interesting
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[...]I say you don't understand becuase(sic) you openly demonstrate as much with your point about collecting on US debt. You seem to think that they can just call it in and get paid, while you totally ignore that doing so would massively devalue the dollar,[...]
and
You know very well what would happen if China tried to unload any real amount of US debt (which they can't simply collect on, as it's not that kind of debt).
You'll have to enlighten me.
How will severely reducing the monetary supply send the US into a hyper-inflationary period? How will selling bonds send the US into a hyper-inflationary period?
It's been a long time.
This is the bare beginning of the largest global depression ever..never before has the world even HAD a "world economy."
Today, we are all interdependent.
That said, The Cepia Club's Project 6, a forecasting model which has been right 75-85% for the past 5 years (www.cepiaclub.com), forecast this crash 5 years ago, and narrowed the time period to now last winter.
The forecast also says to expect the Yuan to increase against the US$ to about 15 times what it was at the end of 2007 by the end of this year (2008.)
Note too that though "your money is safe" in insured accounts, it is not safe from inflation, and it is set to inflate a LOT!
Remember that the European banks used all available assets to bail us out in August 2007.
Congress just agreed to increase the base debt by nearly 7% with the "bailout." This is less than 1/3 of what is needed, and, since it is backed by nothing (every single Fed note is guaranteed by the Fed to be exchangeable for another note of the same denomination, or smaller bills totaling equal value,) will inflate the currency by a large percentage.
This crash came as a surprise only to the Media and Mr. Bush.
The method used to calculate the quarterly Gross Domestic Product (GDP) changes references ONLY the previous quarter, and yet the "official" definition of a recession is "2 successive negative quarters." This detaches the numbers from any history, meaning that one large fall in the QGDP can appear as a one time event, because many subsequent quarters can be positive without ever regaining the drop.
This, and other things like the "bankruptcy party" (the "free$" you may have gotten,) last spring is what has kept the past 30 months of recession from being "official."
You can expect 3rd QGDP to be negative and 4th QGDP to be grossly negative, according to predictions made by The Cepia Club's Project 6 forecasting. (www.cepiaclub.com)
The Government can only announce a recession 'after the fact' by at least 3 months (the official QGDP comes out ~90 days after the end of the quarter it pertains to,) by which time, we have been in a recession for 9 months.
Expect a recession to be declared in late March 2009.
Since as far as I have determined, the BEA (Bureau of Economic Analysis) has no official definition for a depression! So we won't have a depression (officially.)
I wish you all well throughout the coming months of "readjustment and recovery."