DIYbanter - View Single Post - How Real Americans Can Compete with "Hard Workin" Day Labor

Brent P

In article .com, wrote:

Comparing debt to the size of the economy is just a feel good for now
measure like you getting a raise in salary and then using that to borrow
more money so you can have a new bass boat when you were at your debt
limit prior to the raise. It's the ability to pay the debt that counts.

Oh, really? And when't the last time the US missed a debt payment?

The here and now mentality. Just keep borrowing and eventually there
won't be enough. And if you pay attention to things, there have been some
interesting moves cash flow wise already.

nonsense deleted

In fact, this decision is made ever day in the market for govt bonds.
And institutions and foreign govts that know a hell of a lot more than
you, say that at 6%, the US is perfectly capable of meeting it's debt
obligations.

For now... what about later? To keep on borrowing until the
limit is found... seems like bad policy to anyone with half a brain.

Where is the US federal government's ability to pay the debt?

It;s in the fact that the US has never failed to pay a debt and that
tax revenues are sufficient to support it. Are all the bond buyers
happy with 6% stupid and only you can see the light?

The US is not paying the debt. It's paying the interest on the ever
growing debt. When is the -principle-, the debt, going to be paid instead
of revolving it? That would be never according to your posts, borrowing
can go into infinity with no limit. It has a limit, when the population
can no longer be taxed more to pay the interest.

more nonsense deleted

Then what exactly were you trying to say?

Here it is, one more time. Now pay attention, you can't possibly be
that stupid. You have to compare economic numbers like US debt, with
relevant contemporary numbers. And when you do that, the US debt is
half it's peak, and at levels similar to the 90s. Would it be nice if
it were lower? Sure. Is the US facing a big calamity? No. Your
vacuum logic is like asking someone what was your debt 40 years ago?
Oh, $5k? And now it's $150k? Oh my God, you're doomed! Never mind
that then he was earning $8k and now he's earning $150K. Or that he
has a house now worth 300K. Get it?

You obviously don't. But then again, you believe in racking up debt into
infinity. At some point, the debt holders want to be paid. Or worse, they
start strong arming the USA with economic threats. Do as we want or the
dollar goes down the toilet. And no matter how expensive that would be to
an enemy balance sheet wise it's cheaper than military war with the US.

I said the national debt, which you brought
up, is about the same in size relative to the economy that it was in
the 90s or mid 50's.

So when you earn more, do you go out and borrow more?

Yes,

So you're one of those morons with maxed credit cards and/or mortgaged to
the brim?

if you bothered to look at economic statistics, you would see that
countries with higher per capita income have higher per capita debt.
This isn't rocket science. Who has a bigger mortgage, the guy making
$150K with a $500K house or the guy making $25K, whose a renter?

Another false comparison and false choice.

Now what happens when the housing market takes a dive? Opps... you're
screwed.

This way you stay up
to your eyeballs in debt? Do you do that personally?

Not up to my eyeballs, no. Nor would I advise anyone to do that. But
over the last several decades, who has come out ahead? Anyone who
bought a home with a large, but realistic mortgage, is way ahead.

Until the bubble bursts.

Of course you'll say
you won't. Because it would be stupid to do that. Yet, you fully endorse
the US government running it's finances that way.

No, again, if you look at how big the economy is today, and tax
revenues that support the ability to pay, the US govt is doing fine.

Doing fine? Only the interest is being paid on an ever increasing debt.
That is not _fine_.

Do you think you;'re smarter than all the bond traders in the world?
They think US bonds are a fair value at 6%. If they had any doubts
about the ability to be paid, credit worthiness, etc, those bonds would
be 3X that.

There is stuff left to forclose on. What happens once the infastructure
has all been 'leased' for 99 years to foreign corporations? What happens
when all the ports are 'leased' away? What happens when there is nothing
left? What happens when the population can't provide enough tax revenue
to meet the interest payments? You propose borrowing into infinity
because today things seem ok. They might not be ok later... In fact
borrowing into infinity insures that they won't be ok at some point. It's
already quite a balancing act to keep things going. When the juggler
misses a ball, what happens?

Actually the percentage of GDP figure for debt wasn't used to calm
the people until rather recently.

Maybe recent to you, but economists have used it all along.

'calm the people' figure it out for yourself.

That's long term foolishness. But it looks good in the short term.

No. Have you ever taken a course in micro or macro economics? Is
any major US corporation debt free? Of course not, the debt tends to
increase with the size of the company Look at any developing country.
the higher the std of living, the higher the debt. What you are
advocating is using what? The debt level of the US govt in 1776?
And it should be below that? Ridiculous to the max!

You don't apparently know what happens to 'developing countries'. The
borrowing is designed to break them so that those lending the money can
come in and take the nation's resources and impose all sorts of
conditions on said nations. It's a nasty world we live in.

Corporations also do not borrow into infinity. When their debt and assets
are out of wack they have more and more trouble borrowing. You are again
playing with strawmen. Assigning a 'no debt' argument to me then knocking
it down. This is your continued nonsense. I grow tired of it.

The problem is that the US federal government is borrowing into infinity
and not reducing principle, just adding to it. On top of this future
liabilities are huge. It's a set up for disaster. You say 'don't worry,
be happy, things are good now'. Corporate borrowing uses the good times
to pay off the loans from the bad times, not to borrow even more and dig
a deeper hole!

That's where the US government will end up. That is unless we start
paying a whole lot more (like most of our incomes) in income taxes. You
do know that's what the income tax pays don't you? The interest on the
debt.

And there we have it folks. According to dimwit here, unless we start
"paying a whole lot more (like most of our incomes) in income taxes",
the world is gonna end. Here;s a news flash: CUT SPENDING

Ok I through with you asshole. Name calling, strawmen. I'm done with you.
BTW I mentioned massive spending cuts numerous times but of course you
purposely forget that. But then again the government isn't cutting
spending. In fact, you recommend borrowing into infinity.

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