How grave is the situation

[Snodog]

So, you have no problem with living beyond your means, giving yourself raises you cannot afford and counterfeiting? At some point, an unsustainable status quo has to be recognized and dealt with like an adult.

Do you think it is your grandchildrens responsibility to maintain your selfish status quo?

First I want to say that I'm no economist and never even took an economics course and for all I know everything I say could be 100% wrong and I'm a madman. However I do find this stuff interesting and have spent many hours reading and learning the last year or so and this is just my opinion. I've studied the Monetarists, Austrians, Keynesians ect... but the school of thought that made the most sense were the Modern Monetary Theorists. I've also learned that economics is a little like religion. No one can prove anything and everyone thinks something different, and everyone is certain they are right!

Now to address your point of selfishness and grandchildren. The only thing that would be selfish would be to leave our grandchildren an aging, crippled infrastructure and subpar education when we had the resources to do otherwise.

Right now we have plenty of people who are sitting at home who want to work. They are our resources. Think about it- for example(I'm not saying you should run your household like this by the way!)- If you and your wife have chores around the house that you want done you can give your kids coupons for completing various jobs. The coupons can be used to pay rent or food costs. One of your kids one day is bored and could use extra coupons(maybe he eats a lot and wants to buy more food) and offers to mow the yard to earn more coupons. And it just so happens that you are lazy and don't feel like mowing the yard even though its been 2 weeks and really needs mowed. Do you tell him no because Daddy is broke and is out of coupons? No you make more coupons and the job gets done and both parties are happy.

As for living beyond our means I'll assume you mean our "high" govt debt. Govt debt sounds bad and could just as well be called private sector surplus. Its an accounting term and never needs to be "paid back", and can go as high as infinity so long as inflation remains under control. Did high govt debt from WW2 cripple that generations children and grandchildrens future? Heck no! The baby boomers where the most prosperous generation in US history. How is it possible that EVERY government has debt and none have a surplus? How can the world as a whole live beyond its means? The answer is of course that every country needs an ample amount of govt debt to have a healthy economy. You won't hear that anywhere in the media or by your favorite politician. They just tell you what you want to hear.

It's govt supluses that are actually bad for the economy. The last 3 times we ran a surplus were followed by recessions and depressions. Surpluses suck the money out of an economy. Money is the lifeblood of an economy, not a sugar high. The Clinton surpluses drained all the money out of the economy and we are still paying the price. Allthough I disagreed with many of Reagans policies, at least he knew how to grow the economy. He ran up the deficit by lowering taxes and increasing spending and the economy took off-with minimal inflation I might add. Before the great depression they ran surpluses for 4-5 years in a row and sucked all the money out. Did you know that Federal deficit growth precedes GDP growth by 1-2 years?

You may have heard people say we are the next Greece. We are not the next Greece. Greece is tied to the Euro and has to balance their budget. They are more like a US state. US can't go broke, and will always have enough money to pay its bills. Thats the beauty of a country in control of its own fiat currency.

The US govt doesn't need tax money to pay its bills. In fact they could pay their bills just fine collecting $0 tax dollars. (not saying they should do that!) Taxes function to heat and cool the economy rather than raise revenue.

The problems we have today with our economy are pseudo problems that can be easily solved with the correct policies. The real problems come when an economy doesn't have enough workforce to create the products and services it requires. Today we have the opposite problem- the people don't have enough money to buy all the products and services we make. The solution is simple- give them more money.

Anyway everyones got an opinion and I'm no different. In my mind it seems pretty clear cut but the fact that our leaders, media, most economists ect.. could all be wrong and I(and a few economists) be right does give me plenty reason for doubt. As humans we would all do better with a little less certitude, especially me.

[DRILLINDK]

First I want to say that I'm no economist and never even took an economics course and for all I know everything I say could be 100% wrong and I'm a madman. However I do find this stuff interesting and have spent many hours reading and learning the last year or so and this is just my opinion. I've studied the Monetarists, Austrians, Keynesians ect... but the school of thought that made the most sense were the Modern Monetary Theorists. I've also learned that economics is a little like religion. No one can prove anything and everyone thinks something different, and everyone is certain they are right!

Now to address your point of selfishness and grandchildren. The only thing that would be selfish would be to leave our grandchildren an aging, crippled infrastructure and subpar education when we had the resources to do otherwise.

Right now we have plenty of people who are sitting at home who want to work. They are our resources. Think about it- for example(I'm not saying you should run your household like this by the way!)- If you and your wife have chores around the house that you want done you can give your kids coupons for completing various jobs. The coupons can be used to pay rent or food costs. One of your kids one day is bored and could use extra coupons(maybe he eats a lot and wants to buy more food) and offers to mow the yard to earn more coupons. And it just so happens that you are lazy and don't feel like mowing the yard even though its been 2 weeks and really needs mowed. Do you tell him no because Daddy is broke and is out of coupons? No you make more coupons and the job gets done and both parties are happy.

As for living beyond our means I'll assume you mean our "high" govt debt. Govt debt sounds bad and could just as well be called private sector surplus. Its an accounting term and never needs to be "paid back", and can go as high as infinity so long as inflation remains under control. Did high govt debt from WW2 cripple that generations children and grandchildrens future? Heck no! The baby boomers where the most prosperous generation in US history. How is it possible that EVERY government has debt and none have a surplus? How can the world as a whole live beyond its means? The answer is of course that every country needs an ample amount of govt debt to have a healthy economy. You won't hear that anywhere in the media or by your favorite politician. They just tell you what you want to hear.

It's govt supluses that are actually bad for the economy. The last 3 times we ran a surplus were followed by recessions and depressions. Surpluses suck the money out of an economy. Money is the lifeblood of an economy, not a sugar high. The Clinton surpluses drained all the money out of the economy and we are still paying the price. Allthough I disagreed with many of Reagans policies, at least he knew how to grow the economy. He ran up the deficit by lowering taxes and increasing spending and the economy took off-with minimal inflation I might add. Before the great depression they ran surpluses for 4-5 years in a row and sucked all the money out. Did you know that Federal deficit growth precedes GDP growth by 1-2 years?

You may have heard people say we are the next Greece. We are not the next Greece. Greece is tied to the Euro and has to balance their budget. They are more like a US state. US can't go broke, and will always have enough money to pay its bills. Thats the beauty of a country in control of its own fiat currency.

The US govt doesn't need tax money to pay its bills. In fact they could pay their bills just fine collecting $0 tax dollars. (not saying they should do that!) Taxes function to heat and cool the economy rather than raise revenue.

The problems we have today with our economy are pseudo problems that can be easily solved with the correct policies. The real problems come when an economy doesn't have enough workforce to create the products and services it requires. Today we have the opposite problem- the people don't have enough money to buy all the products and services we make. The solution is simple- give them more money.

Anyway everyones got an opinion and I'm no different. In my mind it seems pretty clear cut but the fact that our leaders, media, most economists ect.. could all be wrong and I(and a few economists) be right does give me plenty reason for doubt. As humans we would all do better with a little less certitude, especially me.

Debt isn't a good thing, but having debt isn't necessary a bad thing either. We can live with debt. However, we cannot continue to run the printing presses 24/7 to pay for all the government luxuries. In turn, our Dollar becomes worthless and consumer staples become more expensive. CPI rose +2.5% just this last quarter. I don't know about you, but I don't enjoy paying $3.50 for a gallon of milk and $4.50 for gasoline. The talking heads our right, we must reduce the amount of debt we have incurred.

[Snodog]

Debt isn't a good thing, but having debt isn't necessary a bad thing either. We can live with debt. However, we cannot continue to run the printing presses 24/7 to pay for all the government luxuries. In turn, our Dollar becomes worthless and consumer staples become more expensive. CPI rose +2.5% just this last quarter. I don't know about you, but I don't enjoy paying $3.50 for a gallon of milk and $4.50 for gasoline. The talking heads our right, we must reduce the amount of debt we have incurred.

You mean the same talking heads who have been telling us hyperinflation is just around the corner for the last 3 years? Inflation is up slightly because the price of oil went up from mideast unrest. Would you sooner live in a high debt country or a low debt country? World debt comparison: The global debt clock | The Economist

[maat55]

[QUOTE]

Now to address your point of selfishness and grandchildren. The only thing that would be selfish would be to leave our grandchildren an aging, crippled infrastructure and subpar education when we had the resources to do otherwise.

It is one thing to maintain and invest prudently into infrastructure. It is another thing to squander future wealth on todays luxuries.

We do not need to build unneeded highways or schools in the name of putting people to work. This makes as much sense as diggin holes and filling them up. Since the DOE was established, test scores have steadily fell. We do not need more federal government education.

Do you tell him no because Daddy is broke and is out of coupons? No you make more coupons and the job gets done and both parties are happy.

Coupons and IOU's are worthless. It is also immoral for daddy to use his grandchilds future labor to pay his son for a lawn job he is too lazy to do himself.

As for living beyond our means I'll assume you mean our "high" govt debt. Govt debt sounds bad and could just as well be called private sector surplus. Its an accounting term and never needs to be "paid back", and can go as high as infinity so long as inflation remains under control.

So, me buying a new car and having my granchildren pay for it in devalued money and on going interest is considered a surplus to who? I do not know about you,but I adhere to principles. Spending more than I earn and passing the debt to future generations is not a moral thing to do, even on an interest only loan.

Did high govt debt from WW2 cripple that generations children and grandchildrens future?

We are talking about two different time frames. We were the last man standing and major producer of the world after WWII. This is nowhere near the case today. We do not have the ability to recover from this debt and the interest is huge and only has up to go.

Heck no! The baby boomers where the most prosperous generation in US history. How is it possible that EVERY government has debt and none have a surplus? How can the world as a whole live beyond its means? The answer is of course that every country needs an ample amount of govt debt to have a healthy economy. You won't hear that anywhere in the media or by your favorite politician. They just tell you what you want to hear.

If this were the case, why don't we just give every american a million dollars, would this not end the recession? The fact is that the government does not create wealth with debt. It is no different than me paying employees to over clean the shop.

It's govt supluses that are actually bad for the economy. The last 3 times we ran a surplus were followed by recessions and depressions. Surpluses suck the money out of an economy.

Surplusses are no different than spending future taxes. Both suck money out of the economy, one today, one tommorrow.

You may have heard people say we are the next Greece. We are not the next Greece. Greece is tied to the Euro and has to balance their budget. They are more like a US state. US can't go broke, and will always have enough money to pay its bills. Thats the beauty of a country in control of its own fiat currency.

No one is exempt from collapsing their currency.

The US govt doesn't need tax money to pay its bills. In fact they could pay their bills just fine collecting $0 tax dollars. (not saying they should do that!) Taxes function to heat and cool the economy rather than raise revenue.

This has to be the most absurd thing I've ever heard. The government cannot create wealth, it can only redistribute it. The more money if counterfeits, the less purchasing power we have.

The problems we have today with our economy are pseudo problems that can be easily solved with the correct policies. The real problems come when an economy doesn't have enough workforce to create the products and services it requires. Today we have the opposite problem- the people don't have enough money to buy all the products and services we make. The solution is simple- give them more money.

We have too many people consuming and not enough producing. Government policies are promoting this through a failed ponzi-scheme(SS), unemployment benefits(employer provided welfare), welfare and minimum wage laws. To finance this, we are going deeper in debt and passing the problem to future americans, which is immoral.

[Frugal]

I would say some of the blame lies there, but both Republicans and Democrats helped to get us in the mess we are in economically with the massive budget deficit.

[maat55]

I would say some of the blame lies there, but both Republicans and Democrats helped to get us in the mess we are in economically with the massive budget deficit.

Both parties are responsible for this mess, along with dumbed down american citizens.

[DRILLINDK]

You're right, both parties are to blame. However, there's a big flaw in our governmental system in that we can only plan not only fiscally, but ideologically at the most four years out. About every four years a new administration rolls in a tries to undermine everything that was establish in the previous administrations term. We're spinning our wheels, as neither party is 100% right. Neither party has America's best interest in mind.

I should be shot for saying this, but the Chinese are doing things right. Ya, ya...we could talk all day about the humanitarian crisis blah blah blah. They let nothing stand in the way of growth and their country. They plan two, four, and ten years ahead, but also twenty-five plus. They built a giant dam that displaced 1,000,000+ people and didn't blink an eye. They are building infrastructure and policies all over the country like this. They get things accomplished and do not let bureaucracy stand in the way.

[DRILLINDK]

You mean the same talking heads who have been telling us hyperinflation is just around the corner for the last 3 years? Inflation is up slightly because the price of oil went up from mideast unrest. Would you sooner live in a high debt country or a low debt country? World debt comparison: The global debt clock | The Economist

What do you call $4.50 gas and $3.5 milk?

[maat55]

You're right, both parties are to blame. However, there's a big flaw in our governmental system in that we can only plan not only fiscally, but ideologically at the most four years out. About every four years a new administration rolls in a tries to undermine everything that was establish in the previous administrations term. We're spinning our wheels, as neither party is 100% right. Neither party has America's best interest in mind.

I should be shot for saying this, but the Chinese are doing things right. Ya, ya...we could talk all day about the humanitarian crisis blah blah blah. They let nothing stand in the way of growth and their country. They plan two, four, and ten years ahead, but also twenty-five plus. They built a giant dam that displaced 1,000,000+ people and didn't blink an eye. They are building infrastructure and policies all over the country like this. They get things accomplished and do not let bureaucracy stand in the way.

A constitutional government would get major infrastructure done as well. Our real problem is the unconstitutional policies. Our massive unfunded liabilities in SS/medicare should not be an issue. Even our defense department is not in line with the founding principles. Social programs(federal level) like welfare, unemployment and medicaid are promoting government dependency and lack of personal responsibility, personal savings and charity.

China is basically implementing early american capitalsim. This is providing just enough incentive for workers to produce more. IMO, we should not be trading or borrowing with China.

[photo]

I am in favor of eliminating entitlements all together.

What cruelty! How will Octomom afford her artificial nails? How will low-income families feed their dozen children? If people actually start working, then our economy will start to have real growth and put overseas workers out of their dollar-an-hour jobs. No, no, no, this will never work.

[snafu]

Maat, China became alarmed in 2008 - 2010 when Americans decreased consumption of goods produced in PRC. They turned their marketing efforts 1st to the Middle East countries like Saudi Arabia, Kuwait, UAE, Quatar. Trade experts were dispatched to list/report how products could be modified inexpensively to capture the buying power of the 15% top income holders. Within four months, we saw the shift of product with Arabic characters on the labels.

In the 2nd quarter we saw the attention of marketing experts taking their 1st hesitant steps to the African continent. Contingents of trade missions led by up coming politicians were departing monthly anywhere there was an established middle class. In 2011 we became more aware of trade missions, delegations and politicians to S. America. We are left with the impression goals changed from selling manufactured products to buying not only natural resources but the properties, mines, operations and rights.

Meanwhile some politicians are making impossible promises in Iowa

[Snodog]

Meanwhile some politicians are making impossible promises in Iowa

But it sounds so good to our itching ears.

[photo]

But it sounds so good to our itching ears.

How long are we going to remain so gullible? Obama's entire campaign on based on hope and change, and he's been such a rotten President that even people who voted for him are highly disappointed.

We have to quit listening to what people say and pay more attention to what they do.

And, we have to quit lying around thinking that the government is going to cure our problems. We have a lot more power over our own lives than most people think.

I'm in my 40s. Maybe I'll see Social Security benefits when I retire, and maybe I won't. I'm not counting on it, though, and neither should anyone else.

[maat55]

I'm in my 40s. Maybe I'll see Social Security benefits when I retire, and maybe I won't. I'm not counting on it, though, and neither should anyone else.

Words of wisdom.