Maxed Out

[highroller]

The idea that the U.S. has some unspecified credit limit is economic illiteracy. The notion is false on many levels.
The U.S. has no trouble finding lenders willing to lend it money at record low interest rates.
Those lenders are largely other Americans, who earn interest, which is income to them.
These low borrowing costs, in turn, reflect what seems to be a persistent savings glut — that is, the private sector wants to save more than it’s willing to invest, even with very low interest rates.
Given this reality, why not put some of those excess savings to work in high-return public investments? Should we really refuse to spend money repairing sewer systems or providing child nutrition if doing so raises the deficit a bit, with only a minor impact on future interest costs?
As for interest, we pay in interest roughly what we paid a decade ago.
So, what exactly is the problem that you are trying solve by balancing the budget, an act that would cause a recession due to the implicit austerity.

A recession would cause Republicans to be easily swept into power again. I think that is the point.

 

[Vern]

A recession would cause Republicans to be easily swept into power again. I think that is the point.

And now you know why they all voted against President Obama's now laughably small stimulus and stopped a perfectly modest jobs bill when UE was over 9% but couldn't pass trump's tax cuts and 2 trillion dollar stimulus fast enough. Just more proof that republicans do not put America first.

 

[Exquisitor]

The idea that the U.S. has some unspecified credit limit is economic illiteracy. The notion is false on many levels.
The U.S. has no trouble finding lenders willing to lend it money at record low interest rates.
Those lenders are largely other Americans, who earn interest, which is income to them.
These low borrowing costs, in turn, reflect what seems to be a persistent savings glut — that is, the private sector wants to save more than it’s willing to invest, even with very low interest rates.
Given this reality, why not put some of those excess savings to work in high-return public investments? Should we really refuse to spend money repairing sewer systems or providing child nutrition if doing so raises the deficit a bit, with only a minor impact on future interest costs?
As for interest, we pay in interest roughly what we paid a decade ago.
So, what exactly is the problem that you are trying solve by balancing the budget, an act that would cause a recession due to the implicit austerity.

I don't know what they should do.

I'm not there with advisors who know what is going on and can tell me in varied opinions that I can vet out and weigh.

Oh, I just thought it would be something to fight for, to keep my Country out of bankruptcy and mismanagement, hopefully the Democrats will keep up the good work.

I don't think fiscal responsibility will cause a recession, but your growth numbers may slow for a time.

 

[rickc]

Our expenditures are unsustainable. The thing about things that are unsustainable is that they will not be sustained. No, not even if we really really super duper think it would be much better for us if they were.

We are getting fat eating our seed corn, insisting to naysayers that we are surrounded by food....

So when are we going to raise taxes and start paying our bills.

You do know U.S. Treasury Bills are the safest investment in the world. It is where investors around the world go in times of financial crisis.

 

[Exquisitor]

So when are we going to raise taxes and start paying our bills.

You do know U.S. Treasury Bills are the safest investment in the world. It is where investors around the world go in times of financial crisis.

ASAP because,... debt sucks!

You know why, you got to pay interest and principle when you already had your fun.

I don't know what to do with their investment dollars, but we shouldn't be living off it.

 

[MTAtech]

I don't know what they should do.

I'm not there with advisors who know what is going on and can tell me in varied opinions that I can vet out and weigh.

Oh, I just thought it would be something to fight for, to keep my Country out of bankruptcy and mismanagement, hopefully the Democrats will keep up the good work.

I don't think fiscal responsibility will cause a recession, but your growth numbers may slow for a time.

I don't mean to be mean, so forgive me if I sounded mean.

Fortunately, the U.S. cannot go bankrupt. It has a sovereign currency and can create money out of thin air.

Let me explain why debt is neither not fiscally responsible nor mismanagement:

First, if we assume the government is responsible for managing the economy, then, it has two tools: Fiscal policy and monetary policy.
Fiscal policy is taxing and spending. Monetary policy is what the Federal Reserve does, manage the money supply and interest rates. The Fed's mandate is to maximize employment and control inflation.

Second, let's say you convince elected leaders that debt is bad and they agree and decide to payoff the debt in ten years. That means that the government would have to slash either $2.8 trillion in spending per year or raise taxes by $2.8 trillion, or a combination of those. Since government spending is a component of GDP, cutting $2.8 trillion from GDP will cause a recession. Likewise, taking $2.8 trillion from consumers, when consumer spending is also a component of GDP, will also cause a recession.

Third, having the willingness to spend huge of money is an emergency -- such as the financial crisis or the Covid crisis, is a major advantage to a county.

Saying all of that, we really don't have to payback the debt. If you want to reduce the effect of the debt, all we need to do is keep annual deficits below that of GDP growth, as a p% of GDP, and we will grow out of debt -- the debt won't disappear but over time will become irrelevant -- just like my previous post about the World War II debt.

 

[Exquisitor]

I don't mean to be mean, so forgive me if I sounded mean.

Fortunately, the U.S. cannot go bankrupt. It has a sovereign currency and can create money out of thin air.

Let me explain why debt is neither not fiscally responsible nor mismanagement:

First, if we assume the government is responsible for managing the economy, then, it has two tools: Fiscal policy and monetary policy.
Fiscal policy is taxing and spending. Monetary policy is what the Federal Reserve does, manage the money supply and interest rates. The Fed's mandate is to maximize employment and control inflation.

Second, let's say you convince elected leaders that debt is bad and they agree and decide to payoff the debt in ten years. That means that the government would have to slash either $2.8 trillion in spending per year or raise taxes by $2.8 trillion, or a combination of those. Since government spending is a component of GDP, cutting $2.8 trillion from GDP will cause a recession. Likewise, taking $2.8 trillion from consumers, when consumer spending is also a component of GDP, will also cause a recession.

Third, having the willingness to spend huge of money is an emergency -- such as the financial crisis or the Covid crisis, is a major advantage to a county.

Saying all of that, we really don't have to payback the debt. If you want to reduce the effect of the debt, all we need to do is keep annual deficits below that of GDP growth, as a p% of GDP, and we will grow out of debt -- the debt won't disappear but over time will become irrelevant -- just like my previous post about the World War II debt.

Don't worry, if you sound mean to me, I'll report you.

I refuse to go the way of hyper-inflation.

I will find a solution.

 

[Exquisitor]

I don't mean to be mean, so forgive me if I sounded mean.

Fortunately, the U.S. cannot go bankrupt. It has a sovereign currency and can create money out of thin air.

Let me explain why debt is neither not fiscally responsible nor mismanagement:

First, if we assume the government is responsible for managing the economy, then, it has two tools: Fiscal policy and monetary policy.
Fiscal policy is taxing and spending. Monetary policy is what the Federal Reserve does, manage the money supply and interest rates. The Fed's mandate is to maximize employment and control inflation.

Second, let's say you convince elected leaders that debt is bad and they agree and decide to payoff the debt in ten years. That means that the government would have to slash either $2.8 trillion in spending per year or raise taxes by $2.8 trillion, or a combination of those. Since government spending is a component of GDP, cutting $2.8 trillion from GDP will cause a recession. Likewise, taking $2.8 trillion from consumers, when consumer spending is also a component of GDP, will also cause a recession.

Third, having the willingness to spend huge of money is an emergency -- such as the financial crisis or the Covid crisis, is a major advantage to a county.

Saying all of that, we really don't have to payback the debt. If you want to reduce the effect of the debt, all we need to do is keep annual deficits below that of GDP growth, as a p% of GDP, and we will grow out of debt -- the debt won't disappear but over time will become irrelevant -- just like my previous post about the World War II debt.

I disagree, US won't go bankrupt for a long time, we could double our debt before the current takes us under, but who wants to pay back sixty Trillion dollars? And over a Trillion dollars a year, just in interest. Did we really need it? Was it that good? But to put it in rich people's pockets is insane.

As resources dwindle we will have to pay it back.

 

[code1211]

Hi!

Debt, as most consumers know through experience, is not a problem until the minimum payments themselves become a problem. Given the current stance of the Fed , interest rates are going to be held relatively low until we reach 'full' employment or until the rate of inflation exceeds 2%/year.

Regards, stay safe 'n well.

I'm not a fortune teller by any interpretation of the phrase.

It seems like investments other than the stock markets are gaining favor of late and that generally is the leading edge indicator of inflation.

Might be something. Might be nothing.

 

[Torus34]

I'm not a fortune teller by any interpretation of the phrase.

It seems like investments other than the stock markets are gaining favor of late and that generally is the leading edge indicator of inflation.

Might be something. Might be nothing.

Hi!

Time, as is said, will tell.

Regards, stay safe 'n well.

 

[Mircea]

It depends on what you can purchase with that currency. China would have to give up a lot of control for their currency to reach reserve status.

I agree, but as I pointed out, they're working jointly with Japan and South Korea.

Who in their right mind would buy a currency whose assets are in a communist country?

China is not communist. They are socialist. No communist country has ever existed. The fact that your government falsely labeled socialist countries as communist countries for purposes of Hate Week does not make a socialist country a communist country.

 

[Mircea]

Are you holding your breath?

No. Why should I?

In reality, you would never have to pay it back.

Worse case scenario is that foreign States stop rolling-over or stop purchasing your treasury securities. In that case, there is no debt. There is only over-spending which would result in rampant Monetary Inflation most likely leading to hyper-Monetary Inflation and then the government would have little choice but to reign in spending.

 

[code1211]

I agree, but as I pointed out, they're working jointly with Japan and South Korea.



China is not communist. They are socialist. No communist country has ever existed. The fact that your government falsely labeled socialist countries as communist countries for purposes of Hate Week does not make a socialist country a communist country.

China SELF IDENTIFIES as being Communist.

 

[CaughtInThe]

we dont have to pay it back. That statement alone shows you dont know what you're talking about. You also seem to think that the budget should be balanced. Have you ever noticed that the ones who tell you that are the ones that balloon the deficit every chance they get? They dont believe their own rhetoric, why do you?

The OP is straight from the Rush Limbaugh show when Obama was president. Ironically, he completely quit talking about it when Trump became president.

 

[EMNofSeattle]

A nation is not a business, businesses can't issue money, and they don't have an army.

Where goes my money, so goes my armies, and where go my armies, so goes my money.

Well actually businesses can issue money, but that aside is your proposal that if we have a debt crisis we send the army to foreign creditors and kill their people to resolve it?

Well the fortunate part about this is that the military has been purged of its competent officers and has been wokified. In the meantime the Russians have missiles that can shoot down stealth aircraft and destroy Abrams tanks.

 

[Jredbaron96]

Well the fortunate part about this is that the military has been purged of its competent officers and has been wokified. In the meantime the Russians have missiles that can shoot down stealth aircraft and destroy Abrams tanks.

Thank you for your meaningless contribution and reminder of the complete lack of knowledge you have of military affairs.

 

[EMNofSeattle]

Thank you for your meaningless contribution and reminder of the complete lack of knowledge you have of military affairs.

Blah blah blah.

I can imagine you as Joseph Stalin in 1941.

“I’ve finally purged all my political rivals out of the service now everything will be great”

In fact there is numerous military officers who’ve been fired for invented offenses like saying the word “faggot” and it’s now known that many people are otherwise leaving. I know several who have left and one who will not reenlist because the values being espoused by the command are not their values. Plus there’s the fact that we’ve now fought numerous wars we’ve lost like Iraq and Afghanistan.

You should google “missile destroys Abrams tanks” there’s plenty of videos of M-1 tanks taken over by ISIS being smoked either by Russians or Syrians with Russian weapons.

 

[Jredbaron96]

I can imagine you as Joseph Stalin in 1941.

“I’ve finally purged all my political rivals out of the service now everything will be great”

What's funny is that the purge wasn't even what crippled the Red Army.

In fact there is numerous military officers who’ve been fired for invented offenses like saying the word “faggot” and it’s now known that many people are otherwise leaving.

If I went up to my 1SG and called him a kike I would get kicked out for obvious reasons.

I know several who have left and one who will not reenlist because the values being espoused by the command are not their values.

Sure you do. And I know people who are willing to serve now because our country isn't being run by an insane orange moron.

You should google “missile destroys Abrams tanks” there’s plenty of videos of M-1 tanks taken over by ISIS being smoked either by Russians or Syrians with Russian weapons.

You're right, I can find lots of videos of incompetent tank crews getting their vehicles mission killed because they're incompetent. Just like I can do the same for Russian tanks as well.

 

[EMNofSeattle]

What's funny is that the purge wasn't even what crippled the Red Army.

ok you know more then all the historians.

If I went up to my 1SG and called him a kike I would get kicked out for obvious reasons.

yeah imagine if that were the standard in world war 2. We’d be kicking people out left and right. Since the people who actually can be literally described as a “fagot” are such a low percentage of the population you think that to appease them we should throw away decades of training and experience? In Russia this wouldn’t even be a topic.

Sure you do. And I know people who are willing to serve now because our country isn't being run by an insane orange moron.

sound like real patriots.

You're right, I can find lots of videos of incompetent tank crews getting their vehicles mission killed because they're incompetent. Just like I can do the same for Russian tanks as well.

and if Russian or Chinese trained soldiers are firing missile systems at tanks then it really doesn’t matter how competent the tank crew is.

One missile armed fighter can junk a ten million dollar vehicle and kill or maim four crew members. It really doesn’t matter if you can find videos of Russians tanks being killed, they’ve always assumed they’re losing half their tanks anyway. We’ve built the Abrams on the idea it’s indestructible and now it’s a sitting duck for more modern systems

 

[EMNofSeattle]

So when are we going to raise taxes and start paying our bills.

You do know U.S. Treasury Bills are the safest investment in the world. It is where investors around the world go in times of financial crisis.

For now. But you know how bankruptcy happens, gradually then suddenly.

 

[jpn]

It seems like investments other than the stock markets are gaining favor of late and that generally is the leading edge indicator of inflation.

"It seems like investments other than stock markets are gaining favor of late..."

Do you know the stock market just set record new highs?

 

[Jredbaron96]

ok you know more then all the historians.

Considering I got that information from historians, I would say no.

yeah imagine if that were the standard in world war 2. We’d be kicking people out left and right.

We did kick people out left and right for failing to adhere to the rules of the Armed Forces.

Since the people who actually can be literally described as a “fagot” are such a low percentage of the population you think that to appease them we should throw away decades of training and experience? In Russia this wouldn’t even be a topic.

The Russian military regularly discharges people who don't obey their rules, so it's pretty clear you're just making shit up at this point.

sound like real patriots.

Not that you would know anything about patriotism, of course.

and if Russian or Chinese trained soldiers are firing missile systems at tanks then it really doesn’t matter how competent the tank crew is.

Thank you for revealing how you know jack shit about how war works.

In reality, well trained ground forces know to properly employ armor supported by infantry and vice versa. This is paramount to proper armored warfare, as infantry are able to support the tanks by spotting and taking out potential anti-tank groups carrying anti-tank guided missiles or towed anti-tank guns (which remain in use by a variety of former WARPAC armies).

Poorly trained armies, like those common in the Arab world, generally struggle at this since they don't have the skill-at-arms to employ them effectively and in unison. The Russians themselves were slaughtered for this their first time in Chechnya where their conscript infantry and tank crews couldn't coordinate to literally save their lives, resulting in the infantry being gunned down en masse outside Grozny while their tanks were blown apart.

But American armored forces have special training facilities especially for this. I've been to one in NTC, and there's additional training facilities all around where tank crews learn the kind of skills needed to survive, like good infantry coordination, over-watch, bounding by vehicle, and tactics like popping up from behind cover to fire and withdrawing before the enemy has time to fire back.

These are all things we train for. When I went to NTC our principle enemy was a Russian-style tank regiment that we eventually defeated by shuttering him into our pre-prepared kill zones after we cut off his escape route with infantry groups supported by the brigade's organic fires and and TOW missiles positioned along passes through the mountains.

But nah, tell us more about these magical Russian and Chinese teams. I'm sure you have loads of information on them.

 

[Mircea]

China SELF IDENTIFIES as being Communist.

So, what, they're still in the Dictatorship of the Proletariat stage?

 

[watsup]

Maxed Out:

We're going to be paying over half a trillion dollars in Debt per year.

If it goes any higher, we won't be able to pay it back with even a trillion dollars a year.

So pay for your infrastructure and then balance that budget.

Are we presently rolling the half a trillion?

Why didn't Trump and the Repubs try to balance the budget instead of giving huge tax breaks to the wealthy elite that they didn't even need?

 

[watsup]

We should all just forget about "tax cut."

The debt's got to be paid.

What about the Trump/Republican tax cut for the wealthy elite? Should that be rolled back?