Debt to GDP now 105%

[JohnC]

It isn't getting any better.
 

Now that we have the first estimate of Q1 GDP growth in both rate of change and absolute current dollar terms ($16,010 billion), we can finally assign the appropriate debt number, which we know on a daily basis and which was $16,771.4 billion as of March 31, to the growth number. The end result: as of March 31, 2013, the US debt/GDP was 104.8%, up from 103% as of December 31, 2012 or a debt growth rate that would make the most insolvent Eurozone nation blush. There was a time when people were concerned about this unsustainable trajectory, but then there was an infamous excel error, and now nobody cares anymore.

 

http://www.zerohedge.com/news/2013-04-26/total-us-debt-gdp-105

We're almost to $17,000,000,000,000.00 ($17 trillion) in debt now.

Visualized:

http://youtu.be/iTBODoBaCns

http://demonocracy.info/infographics/usa/us_debt/us_debt.html

http://demonocracy.info/infographics/usa/federal_reserve-qe3/money_printing-2012-2013.html

Let's hear it for a total failure of leadership on all sides, Dems, Reps, etc., for wasting time on stupid crap that steals freedom and liberty such as anti-2A gun control, while we crumble financially.

The goals and priorities of our government are backwards and corrupt!

[Guest ThePunisher]

Does this mean we're going over the fiscal cliff?

[Guest Lester Weevils]

Its all monopoly money anyway. Has been for quite awhile, just the last few years it becomes more obvious.

[RED333]

Total failure is coming, dollar not worth the paper it is printed on.

It is what the present ADM is wanting, then the government can come in and take over every part of our lives.

Sad part is we have no control, but to be a complainer and vote, for the good it does, I dont know.

[Guest 6.8 AR]

We drove over the cliff a while back, just no one will admit it. I think it will be apparent to more, soon. When

the funny money runs out and the EBT card quits working we will all know. The "cake and eat it, too" crowd

will be the first to remind us by their actions. Of course, by then, it will be too late.

 

Cheerful, aren't I?

[Erik88]

I don't know enough about economics to predict what will happen. What I do know is that running a 17 trillion dollar debt is not sustainable. 

 

What I can't understand is why the stock market is at an all time high. Everyone keeps saying the collapse is coming soon and I'm not disagreeing but one would think it would have happened back in 08-09 when things were much worse. 

[Glenn]

One of these days we will wake up and find all "old" money is seized by the Government and we are issued Gov. debit cards. That way every sale is controlled and taxed. 

[Guest 6.8 AR]

I don't know enough about economics to predict what will happen. What I do know is that running a 17 trillion dollar debt is not sustainable. 

 

What I can't understand is why the stock market is at an all time high. Everyone keeps saying the collapse is coming soon and I'm not disagreeing but one would think it would have happened back in 08-09 when things were much worse. 

08-09 was a road bump, a warning. The bailout, if you'll go back and read a little more, Erik, was mostly printed

money, with nothing backing it up, and given, with strings attached, to the banks and insurance industry. More to

it than that, but that's it, in a nutshell. When you print money, you expand one thing and contract something else.

We fet the contraction by our dollar being less valuable. The banking industry got what they wanted. I'm not

going to demonize them, but it is one area that will come back to haunt us, very soon. Keynsean(sp) economics.

 

The problem with that ponzi scheme is that you and I will pay the bill in higher prices on everything. No way around

it. It's also going to affect the entire global economy, not just us.

[ncldwell]

When we see ourselves back using the barter system will all those hoarders I see on TV be rich?

[Guest 270win]

We have a rough road ahead. 

 

Last year, I wanted to buy several thousand dollars worth of ammo to save and eventually sell.  Unfortunately I did not have the cash to buy that much ammo.  I could have done quite well this year with that much ammo.

 

If you have cash and ammo becomes more available, buy what you can and extra because ammo is more valuable than gold.

 

 

If you want to see something real scary, take a look at the US Treasury's 2012 financial statements.  We have a situation where we are bringing in 2 trill in revenue 3 trill in expenses and 1 trill in the hole.  Then look at the balance sheet we have about 3 trill in assets 11 trill in liabilites and a NEGATIVE equity in the neighborhood of 15 trillion.

 

Those of you who run businesses know that is a bad position to be in.

Edited April 27, 2013 by 270win

[Guest Lester Weevils]

I don't know enough about economics to predict what will happen. What I do know is that running a 17 trillion dollar debt is not sustainable. 

 

What I can't understand is why the stock market is at an all time high. Everyone keeps saying the collapse is coming soon and I'm not disagreeing but one would think it would have happened back in 08-09 when things were much worse. 

 

I don't know much more than economics 202, but it appears that a great deal of the monopoly money is going into corporate illusory profits and into the stock market.

 

Had posted a message awhile back, with links to a table of historical dow jones figures and the government's BLS inflation calculator. The "high point" the market now enjoys, when inflation-adjusted, is LOWER than the "high points" hit around 1999-2000 and in 2006 before the long 2-year slide followed by a cliff in 2008-2009. Perhaps more sophisticated analysis would show a different picture taking into account the valleys in-between, and not merely the peaks.

 

However, even using government inflation figures, it appears that the stock market has been steadily losing value for at least 15 years, even though the absolute numbers continue to increase. And given that the government has been screwing with the inflation metrics so that we can't compare current apples to historical oranges, most likely inflation is far greater than the government inflation figures. Which, if true, would mean that the stock market has been sinking like a stone for at least a decade.

 

That doesn't mean that an insider high roller or lucky gambler can't make gains on the market. Buy when you know it is at a low point, and then sell when you know it is at a high point, and make money hand over fist, even inflation-adjusted. Or a truly lucky fella doing the same merely using blind guestimates. But there doesn't seem any way to make money with any buy-and-hold cost-averaging strategy, if the overall market value keeps declining, inflation-adjusted.

 

Someone on this forum mentioned this site a few years ago, of which I'm thankful. Which makes a decent case of arguing that the government inflation figures are mis-under-estimated--

 

http://www.shadowstats.com/alternate_data/inflation-charts

 

Short summary-- Inflation is calculated by figuring a "basket of goods". But they keep changing the basket. For instance, if steak was in the basket some years past, at some point they make an "equivalent substitution" of hamburger for steak, when steak would show too high an inflation rate and people quit buying steak. So since hamburger is cheaper than steak, the following inflation rates get mis-under-estimated. Maybe later on when hamburger gets too expensive they will subsitute beans or ramen noodles for hamburger in the basket of goods. If the government shows significant inflation even if you are comparing the current price of ramen noodles with the historical price of steak, then that would be pretty bad. :)

[zapfbroad]

That's part of the push from both sides to move govt measuring to chained cpi, to offset the 'baskets' depreciating value. It's getting headway with ss & medicare entitlements but will be applicable to a much broader aspect if adopted. It will prolong the inevitable of the day of reckoning. Our market's current bubble is due in part to the fed qe1,2,3,infinitum plus dodd-frank which isn't even finalized in all its' rules & regs but it makes certain moves basically insured and now our too left to fail industries are booming. Notice all the earnings are down, profits are down & efficiencies are being wrung for every drop, that's why there's no hiring but layoffs instead. Which in turn is drawing down on a consumer driven economy. Now that 20% of our gdp in healthcare is being governmentalized look for that sector to further sink. Our debt to gdp is an issue but the biggest issue is a worldwide currency problem 40 years in the making with disparities, inflation & parlor tricks of accounting. It is truly a macro econ scope problem & we arejust given dribbles of the micro issues here stateside with occassional tidbits trickling in from overseas. The entire calculation process of gdp is flawed because of so many component imports from other countries along the supply chain. China/australia are presently working to have direct currency exchange bypassing the dollar & china/russia won't be far behind. The eurozone is in red hot troubles and will undergo either fundamental change within the next 24months or dissolve & breakdown into regional currencies once more. Import/export markets of goods&debt have passed a tipping point with outliers of the US being larger consumers than domestically. It's a perilous situation that cannot be resolved in the next 3.5 years with this admin or bernanke. IF the worldwide financial hemorrhaging can be abated from US policy. My humble opinion which is presented without any nobel awards or extra letters behind my name: go over to the survival forum & start readin up on that big list of survival links I posted. It's all a delicate spider web that is gonna have a rhesus monk turd drop through the center.

Sent from my SPH-D700 using Tapatalk 2

[zapfbroad]

If this stuff is really of interest to you start by reading every column on http://www.realclearmarkets.com going back a week & you'll see part of what I'm talking about. Then readother articles on those linked to sites & it'll really get scary when you realize economists are about as divided as political parties and there's about 3-4 main schools of thought & they don't have a lot of overlap and different areas subscribe to different thoughts. It's worse than just keynes vs the austrians. Its more like 6 different branches of libertarians lol.

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[Rowdy]

One of these days we will wake up and find all "old" money is seized by the Government and we are issued Gov. debit cards. That way every sale is controlled and taxed.

That's when the current barter system will grow exponentially. Basically, our economy will start over, reset, if you please.

[Rowdy]

I don't know much more than economics 202, but it appears that a great deal of the monopoly money is going into corporate illusory profits and into the stock market.
 
Had posted a message awhile back, with links to a table of historical dow jones figures and the government's BLS inflation calculator. The "high point" the market now enjoys, when inflation-adjusted, is LOWER than the "high points" hit around 1999-2000 and in 2006 before the long 2-year slide followed by a cliff in 2008-2009. Perhaps more sophisticated analysis would show a different picture taking into account the valleys in-between, and not merely the peaks.
 
However, even using government inflation figures, it appears that the stock market has been steadily losing value for at least 15 years, even though the absolute numbers continue to increase. And given that the government has been screwing with the inflation metrics so that we can't compare current apples to historical oranges, most likely inflation is far greater than the government inflation figures. Which, if true, would mean that the stock market has been sinking like a stone for at least a decade.
 
That doesn't mean that an insider high roller or lucky gambler can't make gains on the market. Buy when you know it is at a low point, and then sell when you know it is at a high point, and make money hand over fist, even inflation-adjusted. Or a truly lucky fella doing the same merely using blind guestimates. But there doesn't seem any way to make money with any buy-and-hold cost-averaging strategy, if the overall market value keeps declining, inflation-adjusted.
 
Someone on this forum mentioned this site a few years ago, of which I'm thankful. Which makes a decent case of arguing that the government inflation figures are mis-under-estimated--
 
http://www.shadowstats.com/alternate_data/inflation-charts
 
Short summary-- Inflation is calculated by figuring a "basket of goods". But they keep changing the basket. For instance, if steak was in the basket some years past, at some point they make an "equivalent substitution" of hamburger for steak, when steak would show too high an inflation rate and people quit buying steak. So since hamburger is cheaper than steak, the following inflation rates get mis-under-estimated. Maybe later on when hamburger gets too expensive they will subsitute beans or ramen noodles for hamburger in the basket of goods. If the government shows significant inflation even if you are comparing the current price of ramen noodles with the historical price of steak, then that would be pretty bad. :)

I don't much about economics (it's called the dismal science for a reason) but I do know the numbers can be easily manipulated. One current measurement of inflation removes the cost of energy and food. No honest person would call that a fair measurement of inflation.

[45guy]

When we see ourselves back using the barter system will all those hoarders I see on TV be rich?

I own a barter exchange in east TN. Business has been and is very good. I do see a lot of businesses going out of business or running very tight on money. That is why the service we provide is doing so well. Things can get so bad that people cannot afford to barter but that has not happened yet.

[Oh Shoot]

....China/australia are presently working to have direct currency exchange bypassing the dollar & china/russia won't be far behind. ...

 

All it would take is for OPEC countries to demand payment in something other than the USD for things to cascade in a hurry.

 

I agree the USD dollar is based on a type of ponzi/confidence game scam at this point, and all it takes for that to fail is for significant players to lose that confidence.

 

- OS

[JohnC]

All it would take is for OPEC countries to demand payment in something other than the USD for things to cascade in a hurry.
 
I agree the USD dollar is based on a type of ponzi/confidence game scam at this point, and all it takes for that to fail is for significant players to lose that confidence.
 
- OS

My thoughts exactly.