Category: US Debt
The analysis published under this category are as follows.
Thursday, June 25, 2015
When Will US Debt Hit the Wall? / Interest-Rates / US Debt
By: DeviantInvestor
As I see it, the following are true:
- Debt is increasing far more rapidly than growth in the underlying economies that must support that debt. Although this is also true in Japan, the UK, and Europe, I’ll focus on the US.
- Revenue is increasing but less rapidly than debt. This is a problem.
- There will come a time when the interest payments on exponentially increasing government debt will exceed what the economy can support. Call that point “hitting the wall.”
- Higher interest rates will cause the US economy to “hit the wall” sooner. Lower interest rates merely delay the “day of reckoning.”
Tuesday, June 09, 2015
Volcker Warns U.S. State Finances Lack “Truth and Integrity” / Politics / US Debt
By: GoldCore
- U.S. state budgets rely on “faulty practices” – Volcker
- Shoddy budget practices push costs to future generations
- Faulty budget practices lead to poor policy making
- “Problems hidden by lack of truth and integrity” – Volcker
- No common definition of balanced budget allows for gimmicks
Saturday, May 23, 2015
Are We in Another Credit Bubble? And Is It Different than Before? / Interest-Rates / US Debt
By: EWI
Part 1 of our FREE report on the recent build-up in credit includes a chart of U.S. corporate debt issuance since 1998 you don't want to miss
Whatever your politics, creed or nationality -- we can all agree that a huge catalyst for the 2008-9 global financial meltdown was the universal binge of bad credit.
A huge part of that bad-debt pile were the "don't-ask-don't-tell" high-yield bonds -- a.k.a. junk bonds -- which were used to fund a lot of things, including corporate takeovers.
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Saturday, May 02, 2015
The U.S. Government: Adding Illiquidity to Insolvency / Politics / US Debt
By: Jeff_Berwick
[The following post is by Managing Director of Windrock Wealth Management Christopher P. Casey, CFA]
Nobody believes that the states will eternally drag the burden of these interest payments. It is obvious that sooner or later all these debts will be liquidated in some way or other, but certainly not by payment of interest and principal according to the terms of the contract.
- Ludwig von Mises, Human Action (1949)
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Thursday, April 02, 2015
Chicago Shockingly Bad Fiscal Health and the Financial Engineering Used to Hide the Facts / Politics / US Debt
By: Mike_Shedlock
Chicago finances are even worse than I thought which is saying quite a bit because I have written about the sorry state of Chicago finances on numerous occasions.
Kristi Culpepper, a bond guru, has gone over Chicago's annual financial report, bond documents, investor presentations, and CAFRs. She has uncovered things the City of Chicago does not want anyone to understand.
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Wednesday, April 01, 2015
Our Current Illusion of Economic Prosperity / Economics / US Debt
By: Frank_Hollenbeck
President Obama and Fed Chair Janet Yellen have been crowing about improving economic conditions in the US. Unemployment is down to 5.5 percent and growth in 2014 hit 2.2 percent.
Journalists and economists point to this improvement as proof that quantitative easing was effective.
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Wednesday, March 04, 2015
Chicago's Only Possible Salvation: A Detroit-Like Bankruptcy / Politics / US Debt
By: Mike_Shedlock
Is the Chicago pension system so messed up and union work rules so entrenched the only way to change either of them is bankruptcy? I think so.
So does Dennis Byrne who wrote on his blog today Chicago's Only Salvation: A Detroit-Like Bankruptcy.
This is a guest post from Byrne.
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Sunday, March 01, 2015
Subprime Rising - U.S. Debt Breaking Bad Part 2 / Interest-Rates / US Debt
By: James_Quinn
‘If you’re committed enough, you can make any story work. I once told a woman I was Kevin Costner, and it worked because I believed it’ – Saul Goodman – Breaking Bad
“As calamitous as the sub-prime blowup seems, it is only the beginning. The credit bubble spawned abuses throughout the system. Sub-prime lending just happened to be the most egregious of the lot, and thus the first to have the cockroaches scurrying out in plain view. The housing market will collapse. New-home construction will collapse. Consumer pocketbooks will be pinched. The consumer spending binge will be over. The U.S. economy will enter a recession.” – Eric Sprott – 2007
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Saturday, February 28, 2015
U.S. Debt Breaking Bad / Interest-Rates / US Debt
By: James_Quinn
“At this juncture, the impact on the broader economy and financial markets of the problems in the subprime market seems likely to be contained.” – Fed chairman, Ben Bernanke, Congressional testimony, March, 2007
“Capitalism without financial failure is not capitalism at all, but a kind of socialism for the rich.” – James Grant, Grant’s Interest Rate Observer
The Federal Reserve issued their fourth quarter Report on Household Debt and Credit last week to the sounds of silence in the mainstream media. There were minor press releases issued by the “professional” financial journalists regurgitating the Federal Reserve’s storyline. Actual analysis, connecting the dots, describing how the massive issuance of student loan and auto loan debt has produced a fake economic recovery, and how the accelerating default rates in auto loans and student loans will produce the next subprime debt implosion, were nowhere to be seen on CNBC, Bloomberg, the WSJ, or any other status quo propaganda media outlet. Their job is not to analyze or seek truth. Their job is to keep their government patrons and Wall Street advertisers happy, while keeping the masses sedated, misinformed, and pliable.
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Friday, January 16, 2015
The Next Subprime Debt Crisis Has Already Started / Interest-Rates / US Debt
By: Money_Morning
Shah Gilani writes: Reading about what's going on in the subprime auto lending space is a lot like reading about drive-by shootings.
Unless you're a subprime borrower, or live in a neighborhood where drive-bys are happening, you probably don't know much about either or think they affect you.
But if you listen closely there's muffled financial "gunfire" already in your neighborhood.
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Tuesday, December 09, 2014
More Washington DC Lies on Debts and Spending / Interest-Rates / US Debt
By: MISES
Mark Brandly writes: ”Recently, the Treasury Department secretary asserted that “The President’s policies and a strengthening U.S. economy have resulted in a reduction of the U.S. budget deficit of approximately two-thirds — the fastest sustained deficit reduction since World War II.” And, “the deficit in FY 20141 fell to $483 billion.”
Tuesday, December 09, 2014
Debt, Default, and Taxes (DDT) Are Poison / Interest-Rates / US Debt
By: DeviantInvestor
The official US National Debt is about $18,000,000,000,000, or 57 times the current market price of the US gold SUPPOSEDLY stored at Fort Knox, the NY Fed, and elsewhere. With so much paper in the system it is easy to see why the Fed publicly denigrates gold.
In the single year from Sept. 30, 2013 to Sept. 30, 2014, the US official national debt increased by over three times the value of all the gold that the US supposedly owns. The total debt and the increase in that debt is clearly “a problem.”
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Wednesday, December 03, 2014
Another Ponzi Roll Over of U.S. Treasury Debt / Interest-Rates / US Debt
By: BATR
As the holiday season draws nearer, it is nice to know that a present for all Americans and future generations is building as the hordes of consumers’ storm the aisles of their favorite box store so that they can go further in debt. Much like maxing out your plastic limits and paying the monthly minimum, the U.S. Treasury just keeps rolling over their debt since their credit card has no ceiling. The banksters behind the Federal Reserve have no problem with monetizing the national debt, since the Treasury provides their stamp of guarantee. As the public sector continues their spending spree, few really know the extent and amount of their share of the obligation.
Tuesday, December 02, 2014
US Debt Reaches $18 Trillion; Surges 70% In ‘Recovery’ of President Obama / Interest-Rates / US Debt
By: GoldCore
Total U.S. national debt hit a new record high overnight at over $18 trillion as the Obama administration continues to pile debt onto the back of the U.S. taxpayer at a rate that would have made George W. Bush look positively prudent.
Saturday, November 08, 2014
Debt on Wheels - Subprime Loans and Auto Sales / Interest-Rates / US Debt
By: Mike_Whitney
Soaring auto sales are not so much a sign of a strong economy as they are an indication of financial hanky-panky. We saw this same type of fakery play out in housing between 2004 – 2006, when prices went through the roof due to a mortgage-lending scam (“subprime”) that crashed the stock market and sent the economy reeling. Now the bigtime money guys are at it again, writing up auto loans for anyone who can sit upright in a chair and scribble an “X” on the dotted line. As a result, car sales have surged to over 16 million for the last 6 months. (A full 7 million more than the low point in January, 2009.) And it’s not hard to see why either. The finance gurus are packaging these sketchy subprimes into bonds, offloading them on eager investors, and recycling the profits into more crappy loans. It’s a perfect circle and it won’t end until the loans start blowing up, jittery investors head for the exits, and Uncle Sugar rides to the rescue with more bailouts.Read full article... Read full article...
Thursday, October 23, 2014
What Debt Deleveraging? / Interest-Rates / US Debt
By: Harry_Dent
The best way to delever is to immediately pay off any existing debt, right? So, how can the global economy do that?
There’s a great new study out from Geneva Reports on the World Economy 16 (ICMB — International Center for Monetary and Banking Studies) called Deleveraging? What Deleveraging?
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Wednesday, October 22, 2014
The Flat Debt Society / Interest-Rates / US Debt
By: John_Mauldin
International Monetary Fund chief Christine Lagarde says the global economy is facing “the risk of a new mediocre, where growth is low and uneven.”… Lagarde said Europe's 18-nation bloc that uses the euro currency – collectively the world's biggest economy – is facing the "not insignificant" risk of falling back into a recession. (VOA News)
Wednesday, October 01, 2014
“Back Door” Method For The Government To Pay Down The Federal Debt Using Private Savings? / Interest-Rates / US Debt
By: Dan_Amerman
The United States government is currently about $17.5 trillion in debt. To place this number in perspective: if we assume that only the above-poverty line households will be making net contributions towards paying this enormous debt, this means that the national debt equals about $180,000 for each "able to pay" household in the US.
With traditional financial planning, the most common way of dealing with this problem – is to completely ignore its existence. Rather than try to incorporate the effects of this massive debt that could transform interest rates, economic growth and rates of return for decades – most investment plans for individuals simply pretend it doesn't exist.
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Wednesday, September 24, 2014
US Government - The World’s Largest Subprime Debtor / Interest-Rates / US Debt
By: David_Howden
Lehman Brothers filed for Chapter 11 bankruptcy protection six years ago this month. The event has become famous as the spark that ignited the global financial crisis. Since that date, millions have lost their jobs and livelihoods, and countless others have seen their futures evaporate before their eyes, sometimes permanently.
At the heart of the crisis of 2008 was a common cause acknowledged by almost all commentators. Borrowers now infamously known as “subprime” (or more politely, “non-prime”) were the main reason behind the meltdown. As financial institutions extended loans to those with less than stable means to repay their debts, the foundation of the financial world was destabilized.
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Tuesday, July 01, 2014
Debt Makes You Dumb - American's Borrowing Just To Get By / Interest-Rates / US Debt
By: John_Rubino
As incomes stagnate and prices rise, a growing number of Americans face a tough choice: either descend a couple of rungs on the lifestyle ladder or borrow to keep it together. Many are apparently choosing door number two. From MarketWatch:
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