Firstly, update time. You already knew this, but recent actions will increase the amount our government is borrowing. duh.

http://www.bloomberg.com/apps/news?pid=20601103&sid=anJ4Egj1nXS8&refer=news

Quote :

"He's asking lawmakers to lift the legal ceiling on the federal debt to a record $11.3 trillion from the current $10.6 trillion. "

Quote :

"Gross U.S. debt, which includes debt held by the public and by government agencies, this year reached about $9.6 trillion, or about 68 percent of gross domestic product. "

Quote :

"If Treasury spends the entire amount next year, as some economists expect, it would drive next year's budget deficit, now projected to be around $500 billion, to $1 trillion or more. That would increase the annual shortfall to about 7 percent of GDP, a record level. The deficit rose to 6 percent of the economy in 1983, when then-President Ronald Reagan was ramping up Cold War-era defense spending and cutting taxes. Michael Feroli, an economist at JPMorgan Chase & Co. in New York, says the combination of the Paulson plan, additional government expenditures, and a slower economy, could swell the deficit to $1.5 trillion -- 10 percent of GDP. "

Now, the national debt clocks have not reached the $1T point yet, but it will soon, and maybe it should have already (I might throw a party in celebration).

--
Let me take this opportunity to restate a view of mine. When taxpayer money goes to bond holders, that's redistribution of the wealth. But from who to whom? I know you people are going to say that 50% of Americans don't make enough to pay taxes, but that doesn't mean they're not affected. One way or the other, when governments hold crazy amounts of debt, it causes a massive flow of money to capital holders, and that money has to come from somewhere, which is workers (those who create value but don't have capital). Those who have lots of equity pay taxes but get much of it back due to the government bidding up the price of money over time.

Those who don't have those savings simply get screwed. Those with significant net debt are going to be taking it in the ass worse than ever as the price of borrowing money goes up after the banking failures finish.

bailing out loans --> more borrowed money --> loans will cost more in the end

9/23/2008 6:16:20 AM

fuck. we are so fucked.

sad part is if we start drilling here we'd probably break even in 5 years of all this debt with the $$$profit$$$ from oil.

and give us another 10 - 20 years to perfect electric cars and hydrogen fuel cells.


fuck an economy right now. this blows

9/23/2008 9:54:31 AM

If you think drilling is the answer to this problem then you're even dumber than anyone here thought you could possibly be.

9/23/2008 10:00:13 AM

We need to drill

We also need to explore other energies, but we need oil.

9/23/2008 10:08:02 AM

^^fucking kill yourself. it's little shits like you with no economic knowledge that created this crisis in the first place.

why don't you go get a 1/2 million dollar loan while your still in school. stfu with the personal insults too.

if you think the economy is gonna stay afloat based on the whim of opecs desire to control supply and price, then you are out of your mind. keep thinking businesses aren't gonna keep failing and jobs aren't going to keep getting lost with the current fuel prices. and of course you have no idea what more job loss means. more people losing their homes and more loans getting the shaft.

you don't deserve to be called an american


[Edited on September 23, 2008 at 10:29 AM. Reason : ,]

9/23/2008 10:26:04 AM

^^^^goddamn you dumb motherfucker. Can you try to stay on topic for once?

Christ.

As for the OP, I was thinking about this the other day. This is exactly like the "wealth distribution" the neocons hated so much when it was going the other way (from rich to poor). Now it's essentially saddling the poor/middle class with unbelievable debt to take care of the irresponsible investment bankers.

I have mentioned it before, but if there has to be a bailout (and I'm not sure there has to be), I'd like to see an idea knocked around that would give the bailout to individuals in danger of foreclosure. It would simulate the housing industry, save homeowners from foreclosure and make the paper that all these companies are sitting on worth something.

[Edited on September 23, 2008 at 10:28 AM. Reason : ^if you didn't derail every thread in this place with worthless trolling, you wouldn't get insulted]

9/23/2008 10:27:28 AM

In no WAY am I for these bailouts or for unfettered welfare. I think they both set a dangerous example of taking away the conseqeunces of bad decisions. And it saddles those who are making good decisions with their consequences. Total horseshit.

Now they want to take away all the risks with investments...wtf... so long capitalism.

9/23/2008 10:35:00 AM

I say let them all eat shit. In the times of our forefathers who built this country, if you didn't work, you didn't eat. If your company went belly up because you were overextended and made very risky choices, then you were fucked. The government didn't help either. And it shouldn't now.

Down with welfare, unemployment, and corporate welfare. The government should stay out of this shit altogether, along with healthcare and retirement benefits like Social Security. Let people make their own mistakes and pay for them. We have too many fucking safety nets in this country.

9/23/2008 10:40:04 AM

^

9/23/2008 10:44:27 AM

^^

9/23/2008 10:47:33 AM

very well said nighthawk.

9/23/2008 10:50:51 AM

Quote :

"In the times of our forefathers who built this country, if you didn't work, you didn't eat. "

Unless you hired some slaves to work for you.

9/23/2008 11:13:27 AM

^From Maine to Brazil!!!111


and we still have that!!

9/23/2008 11:18:42 AM

Folks with property have been able to avoid working for thousands of years.

9/23/2008 11:19:02 AM

Quote :

"Down with welfare, unemployment, and corporate welfare. The government should stay out of this shit altogether, along with healthcare and retirement benefits like Social Security. Let people make their own mistakes and pay for them. We have too many fucking safety nets in this country."

If the gov. actually did this, half the country would end up looking like a 3rd world ghetto, and the other half would pretty much look like it does now.

9/23/2008 11:22:42 AM

^inorite. you wouldn't get your free money monthly would you. go cry me a fucking river

9/23/2008 11:29:23 AM

^ maybe the time of our forefathers was the best time... we should bring back slavery, and i've always wanted to kill me an injun.

9/23/2008 11:34:57 AM

^somebody suspend this tool

9/23/2008 11:48:35 AM

Quote :

"Folks with property have been able to avoid working for thousands of years."

I certainly think this is true. But as an economic thought experiment, what if everyone else saved?

With a constant population, the time value of money would go to damned near zero. The rich would eventually draw out their investment and be just as wealthy as everybody else.

On the flip side of that, the more borrowing exists (or is forced upon all citizens), the stronger degree of a class society we commit ourselves to.

--
You all say this is a burden on the poor/middle classes. But think about this:

10 Trillion dollarbucks / (115 million households) = $ 87,000 debt per household

But, of course, when people make the arguments for implied SS debt, this number can skyrocket to hundreds of thousands.

But wait! Something's funny here. How much is a household worth? I'll bet the median household out there doesn't have anything like $87k and would have a hard time saving that through even a decade. The poor of the nation can't even approach this number. How can our average government debt (neglecting PERSONAL debt) per head be vastly greater than the earning power of a typical home??!

Think about it, does that even make any sense? And another thing, what about the value creating power of those households? How does that compare to the debt they have? Is our power to create economic value at work hurt of helped by our painfully low savings rate?

9/23/2008 11:57:07 AM

^excellent viewpoints

9/23/2008 12:01:51 PM

thanks, but... there are a lot of open questions there.

I'm not a very good economist. But there are ways of viewing such problems that will be true one way or the other. Conservation of value, what goes in minus what goes out, what's saved, and what's destroyed should equal zero. You can critique my selection of terms.

9/23/2008 4:25:42 PM

Quote :

"csharp_live: you don't deserve to be called an american jocristian ^^^^goddamn you dumb motherfucker. Can you try to stay on topic for once? "

Thanks for reminding me why I don't spend NEAR as much time in these threads, much less posting in them.

9/24/2008 1:24:06 PM