And so what happens in two years' time?
Discussion
The US has just agreed to be allowed to borrow even more money so they can keep the wheels turning for two years. Everyone gets paid and the wheels stay on the economy, hurrah. Had they not done so, the consequences for all of us would have been, shall we say, 'interesting'.
And so in May 2025, when US debt is even bigger, do they just say 'Yeah whatever' and carry on with even more borrowing?
I would also like to know where this limitless source of money comes from - interest payments from previous years? Something isn't sustainable.
And so in May 2025, when US debt is even bigger, do they just say 'Yeah whatever' and carry on with even more borrowing?
I would also like to know where this limitless source of money comes from - interest payments from previous years? Something isn't sustainable.
Jiebo said:
National debt isn't the same as debt that you and I take, it will never be paid back, as its just imaginary numbers in a computer. What they are doing is devaluing their currency, but given their position being the reserve currency, not sure it really matters.
If it is imaginary why were the markets worried? Whatever happens in America hits us and most of the world too.Skyedriver said:
All waiting for the euromillions win....
Some kind of intergalactic lottery perhaps. Yep, that will fix it.But as the cover of Private Eye said in the 1980s to Ronald Reagan, 'But Mr President, Wonder Woman doesn't actually exist'.
What is the most solvent country in the world - a Middle Eastern one? China? Brunei? Switzerland?
They put it up every few years, or sometimes more often. IIRC 20 years back it went up so often they put it onto auto pilot so it just went up on its own.
It means nothing because they are making it up as they go along as the money never really exists and its all about lending themselves imaginary money that they are printing themselves. Its insane but thats how the US economy works. Think the DXY could be in for a hard time tbh and they are trying to keep it afloat.
It means nothing because they are making it up as they go along as the money never really exists and its all about lending themselves imaginary money that they are printing themselves. Its insane but thats how the US economy works. Think the DXY could be in for a hard time tbh and they are trying to keep it afloat.
egomeister said:
I'm sure some of the small oil states have good figures, but in terms of major players the Russian central bank has done a very good job.
Except of course most of these sovereign wealth funds are quite heavily exposed to the US, through property ,equities & yep US government debt. If the US goes south a lot of these smaller oil states will catch a cold. `it’s in nobodies interest for the US to fail, so nobody will call it. Jiebo said:
National debt isn't the same as debt that you and I take, it will never be paid back, as its just imaginary numbers in a computer. What they are doing is devaluing their currency, but given their position being the reserve currency, not sure it really matters.
Interest paid on national debt (%age GDP) and deficit trend (especially when growing) are far more relevant than debt itself. Economic confidence goes rapidly downhill when control of these factors is lost.Debt diminishes over time due to inflation, is often written off and is little more than conceptual.
GT03ROB said:
Except of course most of these sovereign wealth funds are quite heavily exposed to the US, through property ,equities & yep US government debt. If the US goes south a lot of these smaller oil states will catch a cold. `it’s in nobodies interest for the US to fail, so nobody will call it.
There was some talk about what the US did to Russia and it's freezing of its debt to them.Seems there are challenges to full on legally seizing it though
https://www.intellinews.com/the-eu-can-t-find-most...
but if they were able to seize it that could have negative consequences, as globally all nations could be at risk of the same treatment from the US so may reduce their US holdings over time.
Also reading this is seems the EU may have vastly over estimated the Russian reserves held in its juristiction!?
I do think when it comes down to it most people, even all the way high up in financial positions in big banks and governments don't know fully what in going on or how it all works, they'd certainly don't know what to do for the best in the long run, only whats best for tomorrow (or til the next election) in their country. History shows us time and time again what happens and it's rarely pretty.
The general populace only really see it on the ground when prices go up and their wages don't and so they are esentially getting poorer and if the food and energy gets too much of a % of their earnings, strikes/protest/unrest can follow. Extreme cases, Sri Lanka recently, mild cases are our level of strikes increasing (let's face it hardly they've been a thing for decades) if inflation continues here we all would have a breaking point, but it "won't/can't as our leaders won't let it", but they didn't want it getting this high did they and they can't seem to reduce it much now (the Rishi halfing promise still means 10.00 has gone to 11.0 and now he will ensures it only goes to 11.55, so he's wants kudos for making it 15.5 inflation in 2 years?)genuine deflation at all possible in the future? doubtful?
I agree it's in no countries interest to see the dollar go right now, but also there is the view that ultimately it's not in their interests to allow the US to just endlessly print money to buy everyone's commodities and goods, to maintain it's status in the world (largely through military might)?
If it's in everyones interest to have the dollar continue to do what's it's doing then approve that infinite debt limit, print us all globally some dollars and we can all live in harmony and wealthy?
And they wonder where inflation is coming from…
Paying all those government “workers” to do jobs with borrowed money.
It’s basically helicopter money/UBI.
Higher interest rates, high inflation, paltry QT, and now giant stimulus.
Isn’t this going to put off buyers of long term USD debt while inflation remains so high?
Paying all those government “workers” to do jobs with borrowed money.
It’s basically helicopter money/UBI.
Higher interest rates, high inflation, paltry QT, and now giant stimulus.
Isn’t this going to put off buyers of long term USD debt while inflation remains so high?
Jiebo said:
National debt isn't the same as debt that you and I take, it will never be paid back, as its just imaginary numbers in a computer. What they are doing is devaluing their currency, but given their position being the reserve currency, not sure it really matters.
You could argue that because they are the reserve currency it matters more, it effects more than just the US. You will get people on both sides arguing how much it effects things of course.
40% of the worlds population are saying they have had enough of the US abusing its privilege as the reserve currency, and that number keeps growing.
When you have American finance guys hoping the BRICS nations get a decent, gold, or asset backed, currency up and running asap so they can get away from the dollar it says a lot. These same guys were saying the dollar will never fail just 2 years ago.
It is funny to watch all the https://stansberryresearch.com videos on Youtube today and then watch the same people talking 12 months ago, 18 months ago and 2 or 3 years ago.
There is a seismic shift in narrative and you can see where they all think this is headed.
I don't mind what happens in America, I don't live there. But I do mind things that have a negative effect on the Simpo Millions.
Do we start moving stuff about to evade the impending tsunami, or do we leave it for a year, or do we say 'It's a long term strategy', stand on the roof and shout 'Do your worst you b
ds!'...?
Do we start moving stuff about to evade the impending tsunami, or do we leave it for a year, or do we say 'It's a long term strategy', stand on the roof and shout 'Do your worst you b
ds!'...?Edited by Simpo Two on Saturday 3rd June 12:29
interesting that much of this conv refers to the US, but its a global thing isn't it? we're no better here, its just that our numbers are paltry in comparison - how many billions did we print/inject into the system; magic'd out of think air.
this is why i don't 'get' the sentiment of paying personal debt ( mortgages etc) off.....we're lent money at rates that are impacted in a positive way by inflation and debasement. So why on earth rush to pay it back?
the £500k loan today in real terms in 10 years time will be a ton less than that in real terms.
this is why i don't 'get' the sentiment of paying personal debt ( mortgages etc) off.....we're lent money at rates that are impacted in a positive way by inflation and debasement. So why on earth rush to pay it back?
the £500k loan today in real terms in 10 years time will be a ton less than that in real terms.
greengreenwood7 said:
interesting that much of this conv refers to the US, but its a global thing isn't it? we're no better here, its just that our numbers are paltry in comparison - how many billions did we print/inject into the system; magic'd out of think air.
this is why i don't 'get' the sentiment of paying personal debt ( mortgages etc) off.....we're lent money at rates that are impacted in a positive way by inflation and debasement. So why on earth rush to pay it back?
the £500k loan today in real terms in 10 years time will be a ton less than that in real terms.
Yes we are the same, and it's arguably worse for us as we largely have to follow the US moves (interest rates) and aren't the reserve currency of anyone (that may not be so bad in the long run). We've run almost perputual deficits (like the US have) since the 70's and it's complete detachment from any gold backing. The lack of backing allowing for these continued deficits and currency creation.this is why i don't 'get' the sentiment of paying personal debt ( mortgages etc) off.....we're lent money at rates that are impacted in a positive way by inflation and debasement. So why on earth rush to pay it back?
the £500k loan today in real terms in 10 years time will be a ton less than that in real terms.
There is seemingly very little reason to save but to counter your view there is still a chance of high inflation on essentials and a deflation in asset prices? Lots of the inflation in essentials (food/fuel) is out of our control/imported and so an economic downturn could force more house sales, if the pound devalues and looks like it could slide further then the foreign buyers of uk property could bail to?
It all seems like a house of cards, but with quite thick strong cards and someone standing around defending them from any rogue would be collapsers!?
Simpo Two said:
Skyedriver said:
All waiting for the euromillions win....
Some kind of intergalactic lottery perhaps. Yep, that will fix it.But as the cover of Private Eye said in the 1980s to Ronald Reagan, 'But Mr President, Wonder Woman doesn't actually exist'.
What is the most solvent country in the world - a Middle Eastern one? China? Brunei? Switzerland?
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