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Thread: Rising interest rates and debt / deficit spell big trouble for US

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    Rising interest rates and debt / deficit spell big trouble for US

    Rising interest rates and debt / deficit spell big trouble for US

    Interest rates have to rise- they have been kept artificially low for years. Unfortunately, that will crease the interest payments on the debt. And our deficit spending is too high- currently around $.53T. We can't reduce the debt if we keep added to it.

    So on to our call of the day, which comes from DoubleLine founder Jeff Gundlach, who has a dire warning on the U.S. fiscal situation.

    “Here we are doing something that almost seems like a suicide mission,” he said in a fresh webcast about his DoubleLine Total Return Bond Fund. “We are increasing the the size of the deficit while we’re raising interest rates.”



    “It’s pretty much unprecedented that we’re seeing this level debt expansion so late in an economic cycle,” Gundlach reportedly said, noting that both Fed fund-rates and the debt-to-GDP level are rising
    Alea iacta est

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    And a related article:

    Feds collect record individual income tax revenues but still run $532.2B deficit

    The federal government collected a record $1,143,141,000,000 in individual income taxes through the first eight months of fiscal 2018 (Oct. 1, 2017 through the end of May), according to the Monthly Treasury Statement released today.

    Despite the record individual income tax collections, the federal government still ran a deficit of $532,241,000,000 over those same eight months, according to the Treasury statement.


    The approximately $1,143,141,000,000 in individual income taxes that the Treasury collected in October through May of this fiscal year was $56,273,800,000 more (in constant May 2018 dollars) than the $1,086,867,200,000 (in constant May 2018 dollars) in individual income taxes that the Treasury collected in October through May of fiscal 2016—which was the previous record.

    Alea iacta est

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    MisterVeritis (06-14-2018)

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    The fault begins in the House of Representatives, extends to the Senate and then on to President Trump.

    Its foundation lies in the rising socialism in the US.
    Call your state legislators and insist they approve the Article V convention of States to propose amendments.

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    I suspect no party or elected politician will propose a budget that has no deficit. The debt will continue to pile up until the USD crashes.
    Alea iacta est

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    The economic numbers going south would make many opposition Congress members pleased as punch. Don't count on help from them. Their paychecks will still clear and their 100 days of attendance on the Hill will still continue. Heaven forbid the Fed has an anti-Trump bent before the midterms or 2020 General election.
    " I'm old-fashioned. I like two sexes! And another thing, all of a sudden I don't like being married to what is known as a 'new woman'. I want a wife, not a competitor. Competitor! Competitor!" - Spencer Tracy in 'Adam's Rib' (1949)

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    donttread's Avatar Senior Member
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    Quote Originally Posted by Peter1469 View Post
    Rising interest rates and debt / deficit spell big trouble for US

    Interest rates have to rise- they have been kept artificially low for years. Unfortunately, that will crease the interest payments on the debt. And our deficit spending is too high- currently around $.53T. We can't reduce the debt if we keep added to it.

    The real cause of the housing boom/crash known in other industries as inflation.

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    Quote Originally Posted by donttread View Post
    The real cause of the housing boom/crash known in other industries as inflation.

    No. The housing crash was caused by laws, regulations, and strong-handed local government pressure on banks to give all mortgage loans on favorable terms. Even for people that a smart high school senior could say- "that person / family cannot service this debt."

    The crash was compounded by we the people: too many of us figured this out and bought houses well beyond their means.

    Most if not all of us are to blame for the housing crash (which contributed to the fiscal crash.) Inflation was not to blame. It was historically low in 2007-2008.
    Alea iacta est

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    Quote Originally Posted by Peter1469 View Post
    No. The housing crash was caused by laws, regulations, and strong-handed local government pressure on banks to give all mortgage loans on favorable terms. Even for people that a smart high school senior could say- "that person / family cannot service this debt."

    The crash was compounded by we the people: too many of us figured this out and bought houses well beyond their means.

    Most if not all of us are to blame for the housing crash (which contributed to the fiscal crash.) Inflation was not to blame. It was historically low in 2007-2008.

    Speak for yourself. I didn't buy a house I couldn't afford.
    Democrats are a clear and present danger to our democracy and our society.

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