TL, I understand you frustrations and concerns, but it's not our individual debt that's the problem per se. It's the entire fraudulent and corrupt central banking scheme fostered upon us in 1913. Ron Paul is right, end the federal reserve and return to Constitutionally authorized currency. Presently we, as a people are economically misled, the costs of goods and services are NOT going up, it's that the value of our currency is going down. This devaluation has been systematically carried out by the federal reserve system on the backs of the taxpayers for a little over a 100 years. However several states have positioned themselves to accept and be repositors of precious metals. Its only the fed.gov edict that requires tax payment in federal reserve currency and that's the hook that keeps the fish on the line. Read "The Monster from Jekyll Island" and "End the Fed" that provides a history of how we got here and solutions of how to recover our financial integrity without collapsing the world economy. It can be done.
For the most part, you're right. Except that the price of gasoline affects all of it and when the price of a barrel of oil goes from $60 a barrel to $85 a barrel, that affects everything and what I called a "real cost increase" which is different from inflation, but looks the same on the books. Reducing the price of oil to $60 a barrel would do two things. 1) it would relieve a lot of cost of goods shipped 2) it is still within the "fiscally viable" range for the cost of drilling and production, so it would actually still spur exploration. Passing 7 trillion dollar budgets did the rest, because the feds only take in 4.5 trillion in taxes.
You are correct, but the game is rigged, I mean who couldn't make ends meet on an income of $5 trillion a year, right? One point and I'll go back to reloading - in 1963 the minimum wage was five 90% silver quarters, those same five 90% silver quarters today go for over $35. Our money is not worth crap and that devalues all everything.
When people insist on funding every damn fool thing that comes along, you end up being unable to fund the things that any damn fool can agree on. Eventually those hard choices will be made by the survivors, so yes start reloading, and save those silver quarters.
Wilson your absolutely correct on both counts, but the meat can be had by reading the summaries that the author thoughtfully providedat the end of each chapter - reduces the 800 plus pages to around 50.
I've been saying this for some time, we need a Debt Jubilee where all debt is wiped out. Our nation cannot survive on any level with the debt the people and government are carrying. On the most basic level, the average person will find it almost impossible to start a business because they are already in debt. Debt is like quicksand, the harder you struggle, the deeper you go. I'm sure everyone has heard of the Tulip Mania that Holland experienced in the 17th Century. People went into debt to buy tulip bulbs in the hope the price would keep climbing. Well, the inevitable crash occurred and a larger enough portion of the population was in serious debt. The government over there decided the only way to save the country would be to wipe out the tulip debts, which they did. And guess what? Everything just went back to normal, nothing horrible happened. As for our national debt, at this point, it seems so hopeless that we might as well ditch that, too.
Regardless of how we got here or whose fault it is, the outcome was written by Friedrich Hayek in 1974 "...this process cannot go on forever." The follow up corollary was written by Herb Stein in 1985 "...if it can’t go on forever it will stop." And stop it will.
Part of the problem is the size of the numbers involved. A person can't visualize even a thousand of something, much less a trillion. Anyone know or care to guess how long a trillion seconds is?
A trillion seconds is 31,709.8 years! Going back in time that's 29,685 BC.
The 35 trillion debt, or worse yet our total "unfunded liabilities" (promises to pay in the future) -220 trillion dollars- is simply impossible. https://www.usdebtclock.org/
Dealing with that giant pile of feces hitting the revolving air impeller will be... ugly.
In comparison, Zimbabwe, Venezuela, or the Weimar Republic will look like broken piggy banks.
Since the national debt is a federal obligation, undertaken by the federal government - not the states that comprise the federal union, nor the individuals who live in those states - the solution would be for the several states to secede from the Union and repudiate all debt to the (former) federal government. That would mean that the states would have to issue their own currency, having fallen back on their own sovereign status, which was the situation prior to the formation of the federal union. And the states could seize all federal property within their borders, as collateral for obligations due and yet unpayable. The only losers under this arrangement would be people who subsist on payments from the now insolvent federal government - whether as employees, holders of public debt, or beneficiaries of various Federal Ponzi schemes, such as Social Security.
As for banks writing off their entire loan portfolios, this would render any bank that did that insolvent, with the added feature that the bank's investors - those who own the equity capital - and its depositors - would have an investment of rather sharply negative value - think of it as a black hole for money. No person in their right mind would let their money get within a mile of such an institution - and if that measure were adopted nationwide, banking would become impossible.
Thank you for that insight. As to your last paragraph, you're right of course, but my point on writing it off and therefore making the bank insolvent would be an action after the bank was already deemed to be insolvent. I'm not interested in investors of the bank, who invested in it while it had already been bailed out once in 2008, or reorganized after 2008 with the understanding that they would just take my hard earned money to make up for their bad investment.
Regarding the national debt and economics - some reasons for optimism:
1. Technological innovation (AI, robotics) offers the opportunity to grow the economy faster than ever before (e.g., see NVDA market cap)
2. Tariffs in the Trump mold can help rebalance and correct foreign misbehavior (e.g., China)
3. Energy independence as a massive new profit center
4. Selling off federal properties that they have no business owning (i.e., the spectrum that ABC, CBS, NBC, et. al. use for free) as well as federal lands that have mineral exploration value
Not saying it will be easy, but the combination of the AI Revolution and Elon Musk on the side of the righteous makes me cautiously optimistic about our economic chances.
Granted, the only hitches in an otherwise astute reply are 1) I'm not sure we have time to spool all of that out, especially AI and drilling the Anwar, which is not the only federal option for spurring mineral production, but the most well-know source of giga barrels of oil; 2) the AI solution is highly dependent on electric power so much so that some of the big players have made direct deals for energy from nuclear power plants. This at a time when our grid is in seriously poor shape what with green energy and EPA restrictions.
AI will be a net drain on the economy, owing to the huge amount of electrical energy required to power it - unless the AI installation has its own nuclear power source. Solar and wind ain't doing it, period. And fossil fuels would be a big problem - there's a radioactive plume downwind from coal and natural gas generating plants - Carbon 14 has a half-life of 28K years, if scrubbers are used, you'd better have a lined ash pit so that cadmium, arsenic, and mercury don't get into the ground water. If scrubbers aren't used, then the rainout from the coal smoke will contaminate agricultural soils with cadmium, arsenic, and mercury. This is the reason that China imports 85% of its food - its soils are contaminated from coal smoke, they generate most of their electricity from coal. Any food grown in that soil will be contaminated as well. That's a big reason not to eat any food grown in China, by the way. Too many people do not consider the cost of externalities in calculating the economic effects of technology - the same consideration goes for EV cars with lithium and sodium batteries - they turn out to be not a very good deal in the end.
Thanks for the great article. Americans don't know enough about economics. They are not taught economics in school for a reason. What the bankers do with fractional reserve banking and the Fed printing currency out of thin air is counterfeiting. That is a treasonous offense mentioned in the Constitution. It is one of the two crimes (the other is treason) that the Founders were most concerned about. The penalty is hanging for both treason and counterfeiting.
As for how to get out of this financial mess, all I can think of is how West Germany had its "Miracle on the Rhine" after WWII.
The USA is not in the exact same situation as W. Germany after WWII, but some solutions would apply. Restructure the currency and cut taxes, regulations, and end price controls.
wilson, I didn't start learning about economics until the early 2000s. I started reading articles online and read Dr. Ron Paul's books (End the Fed, etc.). The Mises Institute's site taught me the most about economics. Walter Block is also a good economist. Rothbard, Hayek, Ludwig von Mises. "Economics in One Lesson" by Henry Hazlit is the best economics book to start with.
PS: If you like videos about WWII and economics, visit the TIK channel on YouTube.
I read End the Fed by Ron Paul, the only politician I ever donated to. Another book that made a big impression was The Road to Serfdom by Hayek. Ayn Rand was also an influence. We the Living was once an all night read. I was never an objectivist although an engineer friend was. I am aware of Ludwig von Mises and think well of him. I have had Creature from Jekyll Island for sometime but haven't read it yet. I already know the outline of what those scumbags did and how they did it.
wilson, I've seen enough video interviews of the author of "Creature from Jekyll Island" to know the story of the creation of the Fed. Evil deeds are done in the dark, eh?
mostly they are. Some, depending on the scope are done right out in the open. They have a captured MSM so they think they can get away with anything. Cover ups, gaslighting, sandbagging, lying, changing the narrative, refusing to answer questions, falling back on this is an active investigation, I can't comment. Felonia Butthurt gave a master class when she testified about Ben Ghazi, the f.b.i. director is another, the D.H.S. director just lies.
PS: Russia has decided to start buying silver to add to its precious metal reserves of gold, platinum, and palladium. Putin is going to put on a silver squeeze. The price is going up.
Economic growth is self-limiting over time, any kind of debt at interest is an exponentially increasing quantity, and the math is well-characterized, see https://www.youtube.com/watch?v=kZA9Hnp3aV4. If you have a debt instrument at, say 5% interest, by the Rule of 70, that total debt - principal plus interest - will double in 70/5 years - or 14 years. That's why people can pay on college loans for ten years and still have a huge amount of money owed to the lender - $100,000 at five percent will double twice in 28 years. And on these loans, the interest is front-loaded, which means that for the first 8 years, you're paying pure interest and not reducing the principal amount at all - that's why banks pressure people to sell their homes every 8 years or so - the borrower never gets any equity, and the bank gets 100% of the interest. In essence, you're renting your house from the bank - and you're on the hook for maintenance, insurance, and taxes. You have all of the risk, and the bank has little or none - the house is the collateral for the loan, and in this situation, in case you default, the house goes to the bank - and if they lose money in selling it, you can wind up owing a "deficiency judgment" - the difference between the value of the mortgage and the amount the bank gets for the house.... Not bad where the bank can generate the money for the loan out of thin air.
TL, I understand you frustrations and concerns, but it's not our individual debt that's the problem per se. It's the entire fraudulent and corrupt central banking scheme fostered upon us in 1913. Ron Paul is right, end the federal reserve and return to Constitutionally authorized currency. Presently we, as a people are economically misled, the costs of goods and services are NOT going up, it's that the value of our currency is going down. This devaluation has been systematically carried out by the federal reserve system on the backs of the taxpayers for a little over a 100 years. However several states have positioned themselves to accept and be repositors of precious metals. Its only the fed.gov edict that requires tax payment in federal reserve currency and that's the hook that keeps the fish on the line. Read "The Monster from Jekyll Island" and "End the Fed" that provides a history of how we got here and solutions of how to recover our financial integrity without collapsing the world economy. It can be done.
For the most part, you're right. Except that the price of gasoline affects all of it and when the price of a barrel of oil goes from $60 a barrel to $85 a barrel, that affects everything and what I called a "real cost increase" which is different from inflation, but looks the same on the books. Reducing the price of oil to $60 a barrel would do two things. 1) it would relieve a lot of cost of goods shipped 2) it is still within the "fiscally viable" range for the cost of drilling and production, so it would actually still spur exploration. Passing 7 trillion dollar budgets did the rest, because the feds only take in 4.5 trillion in taxes.
You are correct, but the game is rigged, I mean who couldn't make ends meet on an income of $5 trillion a year, right? One point and I'll go back to reloading - in 1963 the minimum wage was five 90% silver quarters, those same five 90% silver quarters today go for over $35. Our money is not worth crap and that devalues all everything.
Granted, spurred by disconnecting the dollar from gold. Thanks Nixon.
When people insist on funding every damn fool thing that comes along, you end up being unable to fund the things that any damn fool can agree on. Eventually those hard choices will be made by the survivors, so yes start reloading, and save those silver quarters.
the creature from Jekyll Island. Monster is the same thing, I guess. A dense book but worth reading.
Wilson your absolutely correct on both counts, but the meat can be had by reading the summaries that the author thoughtfully providedat the end of each chapter - reduces the 800 plus pages to around 50.
thanks for that note.
I've been saying this for some time, we need a Debt Jubilee where all debt is wiped out. Our nation cannot survive on any level with the debt the people and government are carrying. On the most basic level, the average person will find it almost impossible to start a business because they are already in debt. Debt is like quicksand, the harder you struggle, the deeper you go. I'm sure everyone has heard of the Tulip Mania that Holland experienced in the 17th Century. People went into debt to buy tulip bulbs in the hope the price would keep climbing. Well, the inevitable crash occurred and a larger enough portion of the population was in serious debt. The government over there decided the only way to save the country would be to wipe out the tulip debts, which they did. And guess what? Everything just went back to normal, nothing horrible happened. As for our national debt, at this point, it seems so hopeless that we might as well ditch that, too.
Regardless of how we got here or whose fault it is, the outcome was written by Friedrich Hayek in 1974 "...this process cannot go on forever." The follow up corollary was written by Herb Stein in 1985 "...if it can’t go on forever it will stop." And stop it will.
Part of the problem is the size of the numbers involved. A person can't visualize even a thousand of something, much less a trillion. Anyone know or care to guess how long a trillion seconds is?
A trillion seconds is 31,709.8 years! Going back in time that's 29,685 BC.
The 35 trillion debt, or worse yet our total "unfunded liabilities" (promises to pay in the future) -220 trillion dollars- is simply impossible. https://www.usdebtclock.org/
Dealing with that giant pile of feces hitting the revolving air impeller will be... ugly.
In comparison, Zimbabwe, Venezuela, or the Weimar Republic will look like broken piggy banks.
That’s okay, because…BREAD AND CIRCUSES!
Watch sports, watch Trump, vote, vote, vote!!!
Wake the fuck up.
Since the national debt is a federal obligation, undertaken by the federal government - not the states that comprise the federal union, nor the individuals who live in those states - the solution would be for the several states to secede from the Union and repudiate all debt to the (former) federal government. That would mean that the states would have to issue their own currency, having fallen back on their own sovereign status, which was the situation prior to the formation of the federal union. And the states could seize all federal property within their borders, as collateral for obligations due and yet unpayable. The only losers under this arrangement would be people who subsist on payments from the now insolvent federal government - whether as employees, holders of public debt, or beneficiaries of various Federal Ponzi schemes, such as Social Security.
As for banks writing off their entire loan portfolios, this would render any bank that did that insolvent, with the added feature that the bank's investors - those who own the equity capital - and its depositors - would have an investment of rather sharply negative value - think of it as a black hole for money. No person in their right mind would let their money get within a mile of such an institution - and if that measure were adopted nationwide, banking would become impossible.
Thank you for that insight. As to your last paragraph, you're right of course, but my point on writing it off and therefore making the bank insolvent would be an action after the bank was already deemed to be insolvent. I'm not interested in investors of the bank, who invested in it while it had already been bailed out once in 2008, or reorganized after 2008 with the understanding that they would just take my hard earned money to make up for their bad investment.
Regarding the national debt and economics - some reasons for optimism:
1. Technological innovation (AI, robotics) offers the opportunity to grow the economy faster than ever before (e.g., see NVDA market cap)
2. Tariffs in the Trump mold can help rebalance and correct foreign misbehavior (e.g., China)
3. Energy independence as a massive new profit center
4. Selling off federal properties that they have no business owning (i.e., the spectrum that ABC, CBS, NBC, et. al. use for free) as well as federal lands that have mineral exploration value
Not saying it will be easy, but the combination of the AI Revolution and Elon Musk on the side of the righteous makes me cautiously optimistic about our economic chances.
It just takes sane leadership.
Granted, the only hitches in an otherwise astute reply are 1) I'm not sure we have time to spool all of that out, especially AI and drilling the Anwar, which is not the only federal option for spurring mineral production, but the most well-know source of giga barrels of oil; 2) the AI solution is highly dependent on electric power so much so that some of the big players have made direct deals for energy from nuclear power plants. This at a time when our grid is in seriously poor shape what with green energy and EPA restrictions.
All fair points!
Elon Musk and Trump WILL be creating a new surveillance system…WATCH! See who Trump aligns with, and who he implements in his administration.
JD Vance…groomed for this position.
AI will be a net drain on the economy, owing to the huge amount of electrical energy required to power it - unless the AI installation has its own nuclear power source. Solar and wind ain't doing it, period. And fossil fuels would be a big problem - there's a radioactive plume downwind from coal and natural gas generating plants - Carbon 14 has a half-life of 28K years, if scrubbers are used, you'd better have a lined ash pit so that cadmium, arsenic, and mercury don't get into the ground water. If scrubbers aren't used, then the rainout from the coal smoke will contaminate agricultural soils with cadmium, arsenic, and mercury. This is the reason that China imports 85% of its food - its soils are contaminated from coal smoke, they generate most of their electricity from coal. Any food grown in that soil will be contaminated as well. That's a big reason not to eat any food grown in China, by the way. Too many people do not consider the cost of externalities in calculating the economic effects of technology - the same consideration goes for EV cars with lithium and sodium batteries - they turn out to be not a very good deal in the end.
Very astute observations.
Onward, Christian soldiers!
Thanks for the great article. Americans don't know enough about economics. They are not taught economics in school for a reason. What the bankers do with fractional reserve banking and the Fed printing currency out of thin air is counterfeiting. That is a treasonous offense mentioned in the Constitution. It is one of the two crimes (the other is treason) that the Founders were most concerned about. The penalty is hanging for both treason and counterfeiting.
As for how to get out of this financial mess, all I can think of is how West Germany had its "Miracle on the Rhine" after WWII.
https://en.wikipedia.org/wiki/Wirtschaftswunder#:~:text=The%20Wirtschaftswunder%20%28German%3A%20%5B%CB%88v%C9%AA%CA%81t.%CA%83afts%CB%8Cv%CA%8And%C9%90%5D%20%E2%93%98%2C%20%22economic%20miracle%22%29%2C%20also,was%20first%20used%20by%20The%20Times%20in%201950.
The USA is not in the exact same situation as W. Germany after WWII, but some solutions would apply. Restructure the currency and cut taxes, regulations, and end price controls.
The one thing I remember from high school economics is Gresham's law. I don't remember anything from college except a little about the world bank.
wilson, I didn't start learning about economics until the early 2000s. I started reading articles online and read Dr. Ron Paul's books (End the Fed, etc.). The Mises Institute's site taught me the most about economics. Walter Block is also a good economist. Rothbard, Hayek, Ludwig von Mises. "Economics in One Lesson" by Henry Hazlit is the best economics book to start with.
PS: If you like videos about WWII and economics, visit the TIK channel on YouTube.
I read End the Fed by Ron Paul, the only politician I ever donated to. Another book that made a big impression was The Road to Serfdom by Hayek. Ayn Rand was also an influence. We the Living was once an all night read. I was never an objectivist although an engineer friend was. I am aware of Ludwig von Mises and think well of him. I have had Creature from Jekyll Island for sometime but haven't read it yet. I already know the outline of what those scumbags did and how they did it.
wilson, I've seen enough video interviews of the author of "Creature from Jekyll Island" to know the story of the creation of the Fed. Evil deeds are done in the dark, eh?
mostly they are. Some, depending on the scope are done right out in the open. They have a captured MSM so they think they can get away with anything. Cover ups, gaslighting, sandbagging, lying, changing the narrative, refusing to answer questions, falling back on this is an active investigation, I can't comment. Felonia Butthurt gave a master class when she testified about Ben Ghazi, the f.b.i. director is another, the D.H.S. director just lies.
PS: Russia has decided to start buying silver to add to its precious metal reserves of gold, platinum, and palladium. Putin is going to put on a silver squeeze. The price is going up.
Economic growth is self-limiting over time, any kind of debt at interest is an exponentially increasing quantity, and the math is well-characterized, see https://www.youtube.com/watch?v=kZA9Hnp3aV4. If you have a debt instrument at, say 5% interest, by the Rule of 70, that total debt - principal plus interest - will double in 70/5 years - or 14 years. That's why people can pay on college loans for ten years and still have a huge amount of money owed to the lender - $100,000 at five percent will double twice in 28 years. And on these loans, the interest is front-loaded, which means that for the first 8 years, you're paying pure interest and not reducing the principal amount at all - that's why banks pressure people to sell their homes every 8 years or so - the borrower never gets any equity, and the bank gets 100% of the interest. In essence, you're renting your house from the bank - and you're on the hook for maintenance, insurance, and taxes. You have all of the risk, and the bank has little or none - the house is the collateral for the loan, and in this situation, in case you default, the house goes to the bank - and if they lose money in selling it, you can wind up owing a "deficiency judgment" - the difference between the value of the mortgage and the amount the bank gets for the house.... Not bad where the bank can generate the money for the loan out of thin air.