It's one of those numbers that's so unbelievable you have to actually think about it for a while... Within the next 12 months, the U.S. Treasury will have to refinance $2 trillion in short-term debt. And that's not counting any additional deficit spending, which is estimated to be around $1.5 trillion. Put the two numbers together. Then ask yourself, how in the world can the Treasury borrow $3.5 trillion in only one year? That's an amount equal to nearly 30% of our entire GDP. And we're the world's biggest economy. Where will the money come from?
How did we end up with so much short-term debt? Like most entities that have far too much debt - whether subprime borrowers, GM, Fannie, or GE - the U.S. Treasury has tried to minimize its interest burden by borrowing for short durations and then "rolling over" the loans when they come due. As they say on Wall Street, "a rolling debt collects no moss." What they mean is, as long as you can extend the debt, you have no problem. Unfortunately, that leads folks to take on ever greater amounts of debt... at ever shorter durations... at ever lower interest rates. Sooner or later, the creditors wake up and ask themselves: What are the chances I will ever actually be repaid? And that's when the trouble starts. Interest rates go up dramatically. Funding costs soar. The party is over. Bankruptcy is next.
More Here..
What will probably come out of all of this is more war, as war makes money. Well, there are a lot of unemployed people. I wonder if they'll bring the draft back.
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QUESTION:
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I don't doubt that we are in trouble, but how is it that a country like JAPAN which is in MUCH worse shape than us is still not bankrupt????
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And yet somehow we are??? Doesn't make sense to me.
Poll:
ReplyDeleteHow many commenters are birthers?
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The major bank bailouts happened here in US soil. Eventually this became a global economic crisis and has and will affect every single country.
ReplyDeleteI do not know what you mean by Japan being in much worse shape. Where did you get your sources for this and have you done your own analysis on this using graphs, charts, and studies?
You should note though that our neighbour Canada isn't going through such extremes as the USA mainly because their bank bailouts werne't so hefty, not to mention, Canada doesn't depend on big corporations to the same extent as the USA. Even Mexico is somehow not making headlines yet.
p.s. Steve Douchy don't be a douche. I am an ex-Democrat and now don't belong to any party.
Canadian Banks are in trouble BIG trouble:
ReplyDeleteRoyal Bank ($624 billion assets) ; $4.8 trillion total derivatives ; $4.3 trillion OTC derivatives
TD ($432 billion assets) ; $2.4 trillion total derivatives ; $2.1 trillion OTC derivatives
BMO ($387 billion assets) ; $2.7 trillion total derivatives ; $2.0 trillion OTC derivatives
Scotiabank ($429 billion assets) ; $1.3 trillion total derivatives ; $1.2 trillion OTC derivatives
CIBC ($344 billion assets) ; $1.2 trillion total derivatives ; $1.1 trillion OTC derivatives
@10:31 and Economic Analyst:
ReplyDeleteDebt by country:
https://www.cia.gov/library/publications/the-world-factbook/rankorder/2186rank.html
Economic Analyst: Please answer my question... Why hasn't Japan defaulted 4 times already. Their Debt to GDP is OFF THE F*CKING CHARTS DUDE!
S'plain Economic Analyst... S'plain.
Also: Why haven't the derivatives exploded the banks. ! Quadrillion. How come that hasn't taken the world down. I doubt Economic Analyst will be able to explain any of this...
I pulled the last of my savings out of my bank yesterday. Makes no sense to trust those thieves for a 1% payback.
ReplyDeleteIn two weeks when I see my accountant I will be canceling my IRA. I am not a fool, there is no way that will be there for me in 20 years. Like storing money in a fireplace and waiting for the government to burn it.
Old habits are hard to break, but they must be broken.
TPTB want us all broke, homeless, helpless, and starving. Don't play their game. Get ready now. If you are a talker and not a doer change your ways now. There won't be many chances left to get ready.
They care about as much about you as the 1.2 million Iraqis we have starved out and murdered.
Get your money out of the bank tomorrow!
ReplyDeleteEven cash in your hand, although backed by nothing, is better than leaving it in the hands of the robbers. YOU WILL be locked out from your money as they inflate/hyperinflate you life savings into dust. FDIC is a scam, don't trust it.
**Troll ignored; feels great!**
30% of GDP is nothing compared to the last depression which was above 100% and this may surprise you but we did not collapse and we paid the debt and we will do the same again.
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ReplyDelete@10:51 Must be a birther...
Or else my question about Japan and 1 Quadrillion in derivatives is Trolling?
F.U. 10:51
Steve Douchy still waiting for an answer...
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I'll explain what 10:17 (Troll) is saying.
ReplyDeleteThe debt to GDP ratio for Japan is much higher then the U.S.
His argument is that Japan has been a successful nation regardless of their debt.
However, He is wrong on two points.
#1. Japan was in a decade long recession due to their financial mismanagement
#2. Japan is still a major manufacturer meaning its exports provide it with economic vibrancy in spite of their massive debt load.
The U.S. on the other hand can not survive this as did Japan. Our manufacturing base is decimated and we run trade deficits year over year. Our economy is 70% consumption largely supplied by the rest of the world. In essence we are the worlds Welfare State.
The ONLY thing that is keeping us afloat is the fact that at present there is no other viable currency to replace the U.S. Dollar. The Euro is the next best thing but with their own troubles (Think Greece) the Dollar is still perceived as the Worlds Reserve Currency.
However, eventually this will collapse under its own weight in due time. The U.S. Dollar is on life support of which “gunboat” diplomacy will be the last resort after all this printing.
Enjoy the ride while you can!
Keeping your money in the bank is like paying the bully to keep his foot on your throat.
ReplyDeleteSo happy to be prepped for a year plus. At Costco yesterday the checker asked 'are you running a restaurant?' - love that! Just cycle your food and there is no waste, no risk. Don't forget to store up water also.
ReplyDeleteYes 11:26 that was a very good answer to the question as to what happened to the derivatives collapse.
ReplyDeleteUgh! Twitter! Love you EA but Twitter?
ReplyDeleteTwitter reminds me of the guy who would sent you a Christmas card detailing what he did everyday for the year. Bleech, only Twitter is real time.
Self-important nonsense.
Other than that, enjoy the buffet.
GET YOUR MONEY OUT OF THE BANK NOW!
The article states "The U.S. has 8,133.5 metric tonnes of gold (it is the world's largest holder). That's 16,267,000 pounds. At current dollar values, it's worth around $300 billion."
ReplyDeletePersonally I don't believe that. Fort Knox for instance has not been audited since the 50s. Watch the online video MONEY MASTERS, the standard on that subject and more.
Most likely the Oligarch bankers vampired away most of the USA's gold holdings long ago. If the USA had 300 billion in physical gold reserves, then an audit would not be a problem to back that up.
It wreaks of corruption just like the Federal Reserve Fraud and their lack of any audit or accountability.
The USA will be left a broken shell. The olive branch may be WWIII and the drafting of every male under 42. The clandestine war empire won't be clandestine any longer. The bankers have to make up for all the lost profit from the cold war ending. A few million dead Americans may do the trick.
Without war, there is nothing left that we are good at; we are mercenaries for Israel only.
There is not even close to the amount of actual Gold and Silver to cover PAPER.
ReplyDeleteG/S is going to take off like a bat out of hell in the next couple years. There will be massive paper defaults and people will be scrambling for any amount they can get at any cost.
Look at Argentina and Zimbabwe as examples. If you have an ounce coin of Gold in Zimbabwe right now you can have your servants call you master and they will bathe women and bring them to you.
In the 80s the Zimbabwe 'dollar' note was worth what ours was at the time. Two months ago on Ebay you could buy a 100 billion note for $5.00. It is real currency. Now for $5 you can get a 100 trillion dollar note.
There are those in Zimbabwe who saw it coming. Let's call them the 2%. You have the opportunity of a lifetime to turn poverty into prosperity RIGHT NOW. Be the 2% here. Forget the slimy system, the banks, the stock scams and get yourself some REAL MONEY.
Get out there and do it, you won't be sorry in a couple years.
Been trying to make contacts around town as to where to find various sellers for meat and wheat. I suggest finding a feed store and asking them for some contacts near you.
ReplyDeleteIf you have any rational friends > are there such people left anymore? > explain real money this way.
ReplyDeleteGet a silver coin, a $20 bill, and a 100-trillion dollar Zimbabwe 'dollar' then explain to them what real money is vs printed fiat paper that is backed by nothing.
Explain that ALL fiat currencies have failed. ALL. No exceptions. Explain that the dollar is the USA's third currency. The first two died, the third will die also.
Explain that in the 1880s people were smart enough to know the bankers were thieves are they were hung dead by lightposts for their underhanded tricks. People today can't figure out who the people are that are screwing them over.
Those that trust in banks and their monopoly funny money are going to get steamrolled and left for dead. Retirees with fixed incomes and/or annuities will be left to die.
The social entitlements will cease. Death. Flies. Crows.
Just what does it take to get through to some people? You have done your studying. You know that government mouthpieces and the media are lying to your face, as they always do. You know that Obama is nothing more than a banker/GS puppet. His job is to pacify you, to buy the banksters more time to loot the treasury and your savings.
Now get off your ass and take action NOW. Your bank could be closed up next week. WHY oh WHY would you risk it all for .05%? Because that it what your daddy would have done? Well son, this ain't 1970. Wake up. Take action NOW.
The clueless sheeple were busy singing praises to Bernanke today. Unbelievable.
ReplyDeleteThe USA economy is toast. There is no stopping the collapse. Put away the flag and start taking care of yourself. Nations come and go. A country is just a scripted society. Same with this one. Concern yourself now with your own needs. Forget politics and such nonsense. Just distractions from what you should be concerned about; making it through economic hell.
ReplyDeleteI wont be able to survive the collapse because I wont have my meds. Sometimes I question Jesus, other times I don't think at all.
ReplyDeleteNot being American, can someone please explain, the following two words, birther and truther thanks.
ReplyDeleteFrom what I read, the real reason why Japan has not imploded yet is due to the following:
ReplyDeletea) It exports a lot of products that the World wants, and consequently has a huge trade surplus.
b) Japanese are still, by far, the biggest savers in the world.
c) The overwhelming holders of Japanese Government Bonds are the Japanese themselves.
d) The interest rate payable on Japanese Government Bonds is super low compared to the rest of the globe.
However, notwithstanding the foregoing, the trend for c) and d) is about to change drastically, as Japan has a huge aging population that now wants its money back. This means the bonds effected will have to be refinanced at much higher interest rates on global markets. Problem is, institutional investors are beginning to balk at sovereign debt. Therefore, it's only a matter of time before Japans debt bomb goes off. If anything, we're probably looking at such an event in about two years or less. Currency devaluation or hyper-inflation will be the result.
Good grief, what a bunch of idiots posting here on this one...........the USA will NOT GO AWAY, we have always been first and always will be. Sure, there are some hard times ahead, but deep down, the whole world loves us even if they won't admit it, and they know they need us,LOL
ReplyDeleteNo worries, buy some silver and gold to hedge, kick back and enjoy the show!
5:10 how long has america been in existing? HOw can you say we have always been first what a joke
ReplyDeleteYou know what. Even if the U.S. still had all that gold it would be irrelevant. $300 billion worth? So what, given there deficit this year alone they would eat though that by March. Then what? The Dollar index has gone from a recent low of 74 to close to 80 but is still down from 120 when Bush Jr. took over. All the U.S. is hanging on to is there reserve currency status and being a illusionary comfort among all the all fiat currency trash out there. Kick the debt can down the road can only go so long when you continue to consume more than you produce..
ReplyDeleteUrbanSurvival
ReplyDeletewww.peoplenomics.com
This guy has been spot on
5:10, have you ever read Jeremiah 50-51? Sounds like the U.S., as exemplified by your arrogance and pride. This is one reason we are being taken down.
ReplyDeleteLol teh bible says you being arrogant!
ReplyDeleteLOL.
6:55 I understand where you are coming from but when everything resets even a small amount of gold would have been critical. Now thanks to the robbing banksters I really think we have close to none.
ReplyDeleteThey creeped it away just like they did the 30 billion in gold under the towers on 9/10/01.
As the FED has already been buying almost all of their own bonds for at least the last year, what is the problem with owning 3.5 trillion more?
ReplyDeleteAs long as the world is depending on the dollar, the US can get away with it.
Would they finally tear down that god forsaken Statue of Liberty? I'm tired of having liberties and the very modest freedom I still do have. On that, I don't blame a cabal of evil men. I blame the coprorate thugs and government leaders who operate in broad daylight. We sold our freedom when we hired bosses to give it to us in crumbs.
ReplyDelete“30% of GDP is nothing compared to the last depression which was above 100% and this may surprise you but we did not collapse and we paid the debt and we will do the same again.” He or she said.
ReplyDeleteBut back then we were still making things, inventing stuff and selling our USA made things and stuff around the world.
We were making or better EARNING money to pay back the debt.
Can we do that same again today???????
Got to go now, Idol is on and housewives, tiger is getting lose and the big blond dummy on tv is getting chills on his legs again...I must be dreaming
GET YOUR MONEY OUT OF THE BANKS NOW, BUY SILVER AND GOLD ON THE FALL NOW AND LAUGH LATER, FALSE FLAG TERROR ATTACK COMING SOON, POSSIBLY AT THE OLYMPICS, THEN CYBER ATTACK, BANK HOLIDAY, FOOD SHORTAGE AND MARTIAL LAW, BE READY!
ReplyDelete11:20,
ReplyDeleteYou are absolutely right.
In fact, there is no shortage of money to buy treasuries. Some say that the Fed issued the better part of $23.4 trillion to the troubled big banks to buy near worthless, mortgage-backed securities and shore up dwindling reserves. These banks in turn are buying treasuries on queue. Pretty ingenious if you ask me.
3:36 Ingenious ? You betcha ! they've been perfecting this game for a long, long time.
ReplyDeletealmost 2 months ago I posted on this site and now I'll say it again.
As long as the majority of the populace considers the greenback worth something; I think they can prop it up forever.
Average people make dumb people think they are geniuses, but it doesn't make them so.
ReplyDeleteThat depends
ReplyDeleteIf everybody is average and no one is above average and the average can coerce the below average
Well there you have it - instant geniuses by all
accounts.