Sunday, November 1, 2009

Dead Government Walking

(Snippet)
The bottom line is that there is serious cause for concern here – and don’t be fooled into thinking this crisis will fix itself when (and if) the economy recovers. Just how bad is it? Below we outline the obligations of the US Federal Government from 2004 to 2009. We present two sets of numbers, as government accounting can vary widely depending upon the source. In column A, we outline the Total US government Obligations, using actuarial reports from the Social Security Administration and the Medicare Trustees Reports. In column B we identify Total Federal obligations according to GAAP accounting provided by Shadow Government Statistics, calculated on a US fiscal year end basis with estimates for 2009. The differences in the absolute amount of total obligations ($114.7 trillion vs. $74.6 trillion in 2009) are a function of timing, the calculation timeline for Social Security and Medicare, and other obligations included under GAAP rules. Either way we choose to calculate it, the total number is preposterously large. From 2004 to 2009, US unfunded obligations increased by an average of almost 50% over this six year period under both calculation methods, while US government revenue increased by only 12%. No company or government can increase its liabilities by more than four times the rate of its revenue and stay solvent for an extended period of time.
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4 comments:

  1. Dead government walking!!!! I wish.

    ReplyDelete
  2. Hey they can't even pass a lousy unemployment benefits extension, does anyone yet understand that the US govt has seriously run out of money??

    Yet they want to finance a trillion dollar boondogle like Healthcare when they can't even manage social security or medicare.

    Both the post office and the FDIC are broke. They are not fooling anyone here any more.

    Dead Govt Walking is right...

    Say Goodnight Gracie!

    ReplyDelete
  3. The game is up and the Govt. knows it. Nations around the world are running for the exits regarding the US dollar.

    The only way to finance everything is by direct monetization, i.e., direct printing.

    When we "borrowed" from foreign countries we basically robbed them of their money so we could spend spend. We knew we were never going to pay it back.

    Let me give you a scenario. Lets say your a spoiled brat who had been given your Daddy's credit card. Well, you went and spent the night away knowing full well it wasn't your credit card nor did you hve any interest in paying it back. So who cares! Spend away.

    However, daddy took the credit card away because you have been irresponsible. But not only did he take the credit card away but he disowned you for your reckless behavior.

    So know your out on the street and have to rely on your own credit cards to fuel your rampant spending. So you go out and get high interest credit cards because your credit sucks and you continue to spend.

    However, unlike last time where you screwed your Dad this time YOU have to pay the piper.

    However, unlike the scenario above where only your credit is ruined, in this case your National Currency gets ruined and your left with Hyper-inflation.


    Welcome to Babylon America.

    We are screwed.

    ReplyDelete
  4. They shot Kennedy!

    ReplyDelete

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