The Burger is Back!!!
Ok,
The Burger is Back!!!
Tick, Tick, Tick....
I will start by saying I don't know what I am talking about on this subject. But, that is what the internet is about, isn't it?
The chart above scares the hell out of me. It is total debt, both private and public, held in the United States. As you can see, it has been going up since the 1970's. I am worried that the main reason for economic growth over past 40 years--basically my entire life--is simply based on the expansion of credit.
So, what is the problem? Well, I guess there is none if we can keep expanding our debt. But, I doubt this is possible, If it is, then jut cut taxes to zero and ignore the debt. There are some people out there--Peter Schiff, Marc Faber--who say that we are beyond the point of no return. And the only reason things have not already imploded is because the Federal Reserve has being artificially propping things up. This would be OK if the Fed could prop things up forever. But, these economists don't think that it possible. They believe the Fed is just making the eventual crash much worse.
Of course, there are other experts who don't agree. Obviously Ben Bernanke is one of them. But, Bernanke was the one who created the conditions for the housing bubbble. And, when it burst, he intially said it would not effect the rest of the economy. So, the guy in charge of fixing this mess did not see it coming, underestimated its seriousness, and has been unable to fix it for four years.
As I said at the beginning, I am not an expert. I am an engineer, not an economist. But, I am begining to wonder if the experts running things really know what they are doing. These are the same clowns who brought us the Internet bubble, the housing bubble, the Euro, and all sorts of other crap. And the thought they don't know what they are doing scares the hell out of me.
Have we created a situation where our economy can't function without constantly adding more debt but also have reached the point where more debt cannot be added? Are we living during the end of the biggest debt bubble of all time?
Well Done The Lake Erie Islands - Went camping with my son on Kelley's Island. That picture is the sunset from the ferry over. I think the Western Lake Erie area is one of the most underrated vacation areas in the world. The islands are fun and beautiful. And, Cedar Point is one of the best amusement parks in the world. Lite on the talking animals. Heavy on the world class roller coasters.
Well Done Curiosity Rover - Just goes to show you what a good robot can do.
Undercooked Manned Space Flight - This is what I am currently working on. Can we have a plan? Any plan? Destination? Can we at least pretend?
Undercooked Liverpoop FC - 3 games into the season and Liverpool FC has one draw and two losses. Worst start since before the Beatles.
Undercooked American Football - Another season of college and professional players bashing their brains in to entertain us. Paging the Roman Empire.
Undercooked Clint Eastwood - What the hell was that?!
Undercooked Mitt Romney - I am glad you are against Obama care. But, maybe you should not have created the precursor to it with RomneyCare.
Undercooked Paul Ryan - I am glad your are in favor onf entitlement reform. But, then maybe you should not have voted for Medicare Part D, the largest entitlement increase in history.
And, great news for all the gamblers out there. Next week Jackpot will be back!
The Burger is Back!!!
Tick, Tick, Tick....
I will start by saying I don't know what I am talking about on this subject. But, that is what the internet is about, isn't it?
The chart above scares the hell out of me. It is total debt, both private and public, held in the United States. As you can see, it has been going up since the 1970's. I am worried that the main reason for economic growth over past 40 years--basically my entire life--is simply based on the expansion of credit.
So, what is the problem? Well, I guess there is none if we can keep expanding our debt. But, I doubt this is possible, If it is, then jut cut taxes to zero and ignore the debt. There are some people out there--Peter Schiff, Marc Faber--who say that we are beyond the point of no return. And the only reason things have not already imploded is because the Federal Reserve has being artificially propping things up. This would be OK if the Fed could prop things up forever. But, these economists don't think that it possible. They believe the Fed is just making the eventual crash much worse.
Of course, there are other experts who don't agree. Obviously Ben Bernanke is one of them. But, Bernanke was the one who created the conditions for the housing bubbble. And, when it burst, he intially said it would not effect the rest of the economy. So, the guy in charge of fixing this mess did not see it coming, underestimated its seriousness, and has been unable to fix it for four years.
As I said at the beginning, I am not an expert. I am an engineer, not an economist. But, I am begining to wonder if the experts running things really know what they are doing. These are the same clowns who brought us the Internet bubble, the housing bubble, the Euro, and all sorts of other crap. And the thought they don't know what they are doing scares the hell out of me.
Have we created a situation where our economy can't function without constantly adding more debt but also have reached the point where more debt cannot be added? Are we living during the end of the biggest debt bubble of all time?
Well Done The Lake Erie Islands - Went camping with my son on Kelley's Island. That picture is the sunset from the ferry over. I think the Western Lake Erie area is one of the most underrated vacation areas in the world. The islands are fun and beautiful. And, Cedar Point is one of the best amusement parks in the world. Lite on the talking animals. Heavy on the world class roller coasters.
Well Done Curiosity Rover - Just goes to show you what a good robot can do.
Undercooked Manned Space Flight - This is what I am currently working on. Can we have a plan? Any plan? Destination? Can we at least pretend?
Undercooked Liverpoop FC - 3 games into the season and Liverpool FC has one draw and two losses. Worst start since before the Beatles.
Undercooked American Football - Another season of college and professional players bashing their brains in to entertain us. Paging the Roman Empire.
Undercooked Clint Eastwood - What the hell was that?!
Undercooked Mitt Romney - I am glad you are against Obama care. But, maybe you should not have created the precursor to it with RomneyCare.
Undercooked Paul Ryan - I am glad your are in favor onf entitlement reform. But, then maybe you should not have voted for Medicare Part D, the largest entitlement increase in history.
And, great news for all the gamblers out there. Next week Jackpot will be back!
posted by cheesie_67 at 1:27 PM
10 Comments:
Tom,
Puzzled by the graph because it reads that the debt is 380% of GDP, which is off by a lot. I went here: http://www.usgovernmentspending.com/debt_deficit_brief.php
and found one that is more commonly reported as slightly over or under 100%. Considering Greece is in financial collapse at what, 118% or 138%, I forget, but that is considered ungodly since they can't print their way out like we are doing. Just thought I would throw that out there right off the bat.
I am delighted that a decent person like you has doubts about the Republicans officially running the country, although some say that they have been anyway, blocking most things Obama has tried to do. I have read that from the night he was elected there has been a conspiracy to get him out. These are rich powerful men and they don't care at all about decent folk.
Don't confuse calling the Repubs on there stuff with being pro Obama. I am definetly not.
Tim,
I will reply here too. That chart is both public and private debt in the US economy.
Can we have an up to date pic of your reasons for living please.
Don't mind you not being pro Obama as long as you can see the difficulties with Repubs.
Burger,
I think you have written before that you're a reader, books that is, mostly of history. There are several books out there that address this topic from different angles. The Road to Serfdom by Hayek is highly rated, though old. There is one Aftershock that is a very current book. Get the 1st edition as it had a great chapter taken out in the 2nd edition. I was very worried about the dollar collapsing completely and getting double digit inflation or worse about a year or two ago. Then I investigated a lot more and found that we may look bad overall, but compared to everyone else we are ok. If you know all this, I apologize in advance. The dollar is pretty much the accepted world currency in most significant ways. It is the dominant exchange currencies in trade. It is supposedly the only currency allowed to buy oil, at least not on the black market. Many countries use it as their own currency, and some use it like gold to back their own currency. For these reasons, it will take a great deal to do away with our dollar, but we are getting weaker. The yuan is being or has been pushed to replace the dollar, but China is in its own severe bubble, overall economically and also specifically in a realestate one. They are also not a transparent society, especially in finance, which strongly discourages investment. Yeah, they still get a lot anyway, but... The Euro was the other currency that was pushed to replace the dollar, but that is long gone now. They will be lucky to keep it in existence at all. So, even though things do not look great for us with the fed buying much of our bonds, the world really does not have many other places to go, and no place that provides a bigger, safer, more transparent market than we provide. We still need to stop spending so much more than we take in, but if we do cut back and grow the economy, we should slowly be able to bring it back under control. At the moment, though, it does not look like there is much in the way of agreement as to how to reduce spending. Much hangs in the balace with this election. If it stays divided, we are totally screwed. As for the private debt issues, we still have years to go because there was a suspension of the foreclosure process in many places, which just makes the problem last longer. Without jobs soon, we will probably have another big crash as unemployment runs out, foreclosures start up again, loans default on education, cars, and other smaller, more private loans. But that seems like common sense.
Tim,
dont apologize for well thought out posts! i will get that book. keep in mind inless it is related to propulsion, I am not anywhere near an expert.
Tom
PS: I will claim expertese on "global warming" becuase i do have the educational and work experience to backup what i say at least as much as 99% of the people who talk on this subject.
I would love to hear your views on global warming. I read extensively, compared to the average person, and had to teach it for several years. Would definitely love to get new sources of info.
Very informative post. Thanks for sharing.
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