The Fiscal Cliff for Dummies
Discussion
Terminator X said:
Can someone pls explain why it matters to us in the UK?
TX.
And on the flip side, if the USA (still the world's #1 consumer of stuff) slips into recession, nobody has anywhere to sell things any more. China will likely stagnate as a result, which is going to do very bad things indeed.TX.
vonuber said:
They should unblock the sewer and maintain it better. Also possibly look at the gradients as it's probably not hitting self cleansing velocity.
Actually this analagy is still working even when stretched this far. To change sewer gradients requires a complete rebuild which is prohibitively expensive.
Irrelevant. US Govt is not limited like a household.
They have no effective spending ceiling unlike a household.
Govt debt is non govt sector savings.
Pensions, investments in gilts etc are all savings, they are the government debt. There is no way the government can fail to pay interest and principle. The Federal reserve would not allow it. One look at QEx would tell you that.
So the conversation is pointless and will only perpetuate failure in the pundits and public who fail to recognise this.
They have no effective spending ceiling unlike a household.
Govt debt is non govt sector savings.
Pensions, investments in gilts etc are all savings, they are the government debt. There is no way the government can fail to pay interest and principle. The Federal reserve would not allow it. One look at QEx would tell you that.
So the conversation is pointless and will only perpetuate failure in the pundits and public who fail to recognise this.
Gene Vincent said:
JensenA said:
Gene Vincent said:
Hmmm, well lets hope the originator of that poster has no say on the matter.
It's not $38.50 but $385.
Horrible fail.
He's not the only one to get it wrong, it's $3.85It's not $38.50 but $385.
Horrible fail.
$38,500,000,000... remove 8 zeroes... $385
Edited by JensenA on Sunday 30th December 16:26
Wikipedia calls bulls
t on that.
http://en.wikipedia.org/wiki/History_of_the_United...
Dubya increased the deficit by $5tn in two terms, in what was mainly a quite benign economic time. BHO has increased the deficit by $4.8tn in one term, although that includes the stimulus package.
t on that.http://en.wikipedia.org/wiki/History_of_the_United...
Dubya increased the deficit by $5tn in two terms, in what was mainly a quite benign economic time. BHO has increased the deficit by $4.8tn in one term, although that includes the stimulus package.
JensenA said:
Can someone explain to Mr.Ignorant here, what exactly this 'Fiscal Cliff' is.
I know that if an agreement is not reached, then everyones Taxes will rise and Government spending will be cut, from 1st January Automatically. But who implements these automatic tax rises, and why is it automatic?
IIRC, it's the timeout for a bunch of tax cuts that Bush 2 put in place in 2003 or something. His tax cuts timeout and everything goes back to the old taxes rates. I'm not sure where the cuts come in though.I know that if an agreement is not reached, then everyones Taxes will rise and Government spending will be cut, from 1st January Automatically. But who implements these automatic tax rises, and why is it automatic?
No idea what's going on though, and I'm here watching it. You can't get a straight answer from the press as they're so bias it's unbelievable.
The only thing that gets me is that everyone views this as a "Really Bad Thing", but increased taxes and reducing the deficit seems pretty sound to me. The only problem is if your income is derived from the Federal Govt. Although this is a military town, we should be fairly immune though.
I'm sure I read somewhere that the US pays out $20bn in interest each month on a budget of around $200bn per month.
davepoth said:
In the USA some people don't consider hospitals a basic need. As they say over there, "Go Figure"...
Most Americans have private health insurance. The ones that don't have car payments.The poor, disabled, and the old get free healthcare. And if you turn up to ER unconscious, they will treat you regardless of ability to pay. From what I've seen here, the ones that choose not to pay for healthcare but have very little and don't qualify for free health care use the ER as a doctors surgery anyway where they can't be refused treatment and the collection agencies have little chance to collect anyway.
Pesty said:
I keep seeing this pic scattered about the internet. Is it remotely accurate? Even if it is accurate does it appear as bad as it looks.
I get the Idea that Obama is the US version of Gordon Brown.
Inflation adjusted?I get the Idea that Obama is the US version of Gordon Brown.
This may seems surprising but, even as a lefty socialist type, I think a fall from the cliff could help the U.S. in the long term. They can’t go on taxing at rates akin to Bolivia but spending at one of the highest per capita rates in the world.
A farmer and later naval officer from Georgia once told America “If you succumb to a dream world, you’ll wake up in a nightmare.” It's not an overwhelming problem yet but they need to find a way to tie spending to taxation in the long term. Both sides have had ample opportunity but neither side individually has managed to deal with the issue, both have failed to date.
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