Sunday, March 7, 2010
Apocalypse Now! - American Debt
One second, just checking my myTouch phone and looking at the Android app called US National Debt. Guess what this app does? No, it does not make you magically lose weight in the middle of the night; it gives you nightmares.
Yup! That's the US national debt from treasurydirect.gov in real time baby. I had to put the last eight digits in zeros, because the numbers were scrolling too fast, I couldn't keep up with all of them. Let's just call it an even $12.5 trillion or about $41,000 per person.
I love when I hear pundits, politicians, and especially average uneducated Americans talk about the national deficit and debt.
At this point these people do NOT know the definition of the Federal deficit or debt.
A deficit is like when I spent fifty cents too much at Starbucks today (because I had to buy the paper I'd already read online for free), so I'll borrow the fifty cents from the sky (China) for today to buy the paper today I already read online for free.
Debt is like I've been borrowing fifty cents a day everyday for the last few billion years and I'm finally being sent a credit card bill for the last billion years of daily loans to subsidize my obsession with buying the paper, I'd already read online for free). And now the credit card company wants it's $12.5 trillion back.
Basically, if we had a balanced budget, last seen under the Clinton Administration, we'd still owe $12.5 trillion!
I suppose a nice part of being American today is we still haven't figured out what our credit line is on our multi-trillion dollar credit card. Today it's $12.5 trillion, by the time Obama leaves office if elected again, it'll surely be over $20 trillion.
When will countries start realizing that America is never, let me repeat, NEVER, ever going to pay this debt off. What will we do? We'll run our credit card limit to the max and even go over our limit whatever that might be.
The consequences of this behavior are easy to understand. Once countries that have loaned money to the US stop doing so, as they realize their investments are becoming more and more risky, these investors will substitute US investing for the better alternatives around the world.
And, once the faucet of our credit it shut off by our lenders, you may just see and hear about America going bankrupt just like Iceland, Greece, with Spain, Ireland, and Portugal likely to soon follow. Note: Almost all these countries ruled the world at one point in history.
What does this mean for my generation that will be in their mid-thirties in ten years? It means buckle up if you are going to stay in the rat race or pull the parachute cord NOW if you're getting off this deadly merry-go-round. I suggest going to Costa Rica, there are no real problems there, the girls are the hottest in Latin America (save Brazil), and you should be safe barring a nuclear Holocaust.
So when we fat Americans look back when our country is no more important than a Spain or a Greece we'll all wonder about what happened.
"How could have America come to this?" We'll say decades from now.
Well America will come to this. And the price is about to be paid. We have only about 20-40 more years of steel, concrete, and other materials essential to continue to build a bigger and more profitable society for the corporations and interests at large. We are told that oil, natuaral gas, and coal have about 75-150 years left of supply, but one must realize that this is a fraction of a second in the time of man.
One hundred and fifty years ago, today, Abraham Lincoln was running for President and the Civil War was about to break out with tensions already at a boiling point in bleeding Kansas and with John Brown's abolitionist raid on the Federal Armory at Harper's Ferry in 1859.
The drunken American party will be over sooner or later in the next century, and the hangover is going to be the worst we have ever had.
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