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Peter1469
04-18-2015, 03:46 PM
The dangers of debt (http://ftalphaville.ft.com/2015/04/16/2126474/debt-is-dangerous-part-245925028508/?Authorised=false#mm)

From the Financial Times new blog, Alphaville.

It discusses why debt is so dangerous. I would say that we have not learned our lesson and our public debt in increasing rather than lowering. The next crash will be much worse, because the Federal Reserve is all out of options. This blog post focuses on private debt, both personal and corporate.


The most recent US downturn was so painful because US households’ borrowing binge in the first half of the 2000s left them stuck repaying large debts (often against assets that had plunged in value) and unable to spend money on new goods and services that they actually wanted. Moreover, they weren’t in a position to take out new to debt to support consumption as they had before the crisis.


A fascinating new paper (http://www.nber.org/papers/w21076) by Xavier Giroud and Holger Mueller argues that many US companies went through a similar experience, and that this made the downturn about twice as worse as it otherwise would have been.

MisterVeritis
04-18-2015, 03:51 PM
The dangers of debt (http://ftalphaville.ft.com/2015/04/16/2126474/debt-is-dangerous-part-245925028508/?Authorised=false#mm)

From the Financial Times new blog, Alphaville.

It discusses why debt is so dangerous. I would say that we have not learned our lesson and our public debt in increasing rather than lowering. The next crash will be much worse, because the Federal Reserve is all out of options. This blog post focuses on private debt, both personal and corporate.
In addition to the 18 trillion in immediate debt we have another 200+ trillion in unfunded promises. We are doomed.

Forward! Comrads!

Peter1469
04-18-2015, 03:55 PM
In addition to the 18 trillion in immediate debt we have another 200+ trillion in unfunded promises. We are doomed.

Forward! Comrads!


That is the official US official and unofficial debt.

Private debt is likely another 40T between individuals and business. Then the mortgage backed securities are estimated to be $500T or more.

MisterVeritis
04-18-2015, 03:58 PM
That is the official US official and unofficial debt.

Private debt is likely another 40T between individuals and business. Then the mortgage backed securities are estimated to be $500T or more.
I have just a small amount of debt. I still owe a bit more than 250K on my house. I have a small amount of monthly debt that rolls over every month. I have around 1500 in credit card debt. And one year to go on a car. So around 255K total.

My "share" of the federal government debt is more than a half million dollars. The good news is that it keeps going up.

Peter1469
04-18-2015, 04:09 PM
I have just a small amount of debt. I still owe a bit more than 250K on my house. I have a small amount of monthly debt that rolls over every month. I have around 1500 in credit card debt. And one year to go on a car. So around 255K total.

My "share" of the federal government debt is more than a half million dollars. The good news is that it keeps going up.

My only debt is my mortgage. And the rent that I get for the property covers it.

The Xl
04-18-2015, 05:03 PM
It's dangerous and more than that, fraudulent. Should be defaulted on

Peter1469
04-18-2015, 05:14 PM
It's dangerous and more than that, fraudulent. Should be defaulted on

Individuals and companies have the bankruptcy code to rely on to discharge debt.

Bob
04-18-2015, 05:33 PM
That is the official US official and unofficial debt.

Private debt is likely another 40T between individuals and business. Then the mortgage backed securities are estimated to be $500T or more.

Don't worry, be happy. We still have Obama. LMAO

Most don't understand how bad it is. They think the Feds offering almost no cost loans is a joke.

It's still bad folks. Unemployment is still super high. This is why wages are flat. 5 percent unemployment normally produces wage hikes and not by a little, by a lot.

Bob
04-18-2015, 05:35 PM
My only debt is my mortgage. And the rent that I get for the property covers it.

Don't forget your share of the debts of both the state and Federal government. I would also add in the projected debts that they have no idea how to pay.

Peter1469
04-18-2015, 05:54 PM
Don't forget your share of the debts of both the state and Federal government. I would also add in the projected debts that they have no idea how to pay.

I paid my fair share of the debt in taxes this year. F-em.

Bob
04-18-2015, 05:57 PM
I paid my fair share of the debt in taxes this year. F-em.

You are far from done.

Peter1469
04-18-2015, 06:01 PM
You are far from done.


Yes, I will pay another outrageous amount next year. But when the clowns crash the economy and government, then no more taxes. At least for a while until grown ups can patch things up.

Bob
04-18-2015, 06:04 PM
Yes, I will pay another outrageous amount next year. But when the clowns crash the economy and government, then no more taxes. At least for a while until grown ups can patch things up.

I wish I could say you are wrong. Honestly, I do wish you were wrong.

Peter1469
04-18-2015, 06:25 PM
I wish I could say you are wrong. Honestly, I do wish you were wrong.

Me too. But numbers don't lie.

The only reason the US has gotten away with its level of debt is because the USD is the world reserve currency. That is changing. Once the USD is no longer the world currency (20-30 yrs IMO) think Wiemar Republic. And that assumes that we don't break the economy prior to that.

Bob
04-18-2015, 06:47 PM
Me too. But numbers don't lie.

The only reason the US has gotten away with its level of debt is because the USD is the world reserve currency. That is changing. Once the USD is no longer the world currency (20-30 yrs IMO) think Wiemar Republic. And that assumes that we don't break the economy prior to that.

We are headed off the currency being the reserve. There are factors other than that which might cause our downfall. China is advancing very rapidly as we speak. The good thing is China still needs our market.

Peter1469
04-18-2015, 06:49 PM
We are headed off the currency being the reserve. There are factors other than that which might cause our downfall. China is advancing very rapidly as we speak. The good thing is China still needs our market.

China is not an issue. They have plenty of problems of their own.