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Old 07-13-2009, 08:04 PM
 
Location: West, Southwest, East & Northeast
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Federal budget deficit tops $1 trillion for first time, could reach $2 trillion by fall
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Old 07-13-2009, 08:09 PM
 
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At some point we will be looking at government program cuts to start to pay off the borrowing from china and then people will really be hurting ifthey depend on government.Take money pout of the invest class that take risk and there will be mroe unempolyemnt as they pul back from the risk being to costly for teh rewards.
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Old 07-13-2009, 08:46 PM
 
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China is not going to be paid back, nor is any other creditor - ever. Talk about the budget deficit is pretty worthless at this stage in the (ponzi) game. What the government needs to do is decide how it's going to default on its debt. Is it going to do so honestly, like Russia did in 1998, or will it print more money and give every one devalued dollars. There is simply no other option at this point.
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Old 07-13-2009, 08:47 PM
 
Location: southern california
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we need to start paying for things instead of signing for things. paying makes you think before you buy.
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Old 07-13-2009, 09:37 PM
 
Location: West, Southwest, East & Northeast
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Old 07-13-2009, 09:40 PM
 
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At this point the bigger the deficit the better.

There's an old saying that applies very well to our situation and goes something like this:
"if you owe the bank $100,000 you have a problem, if you owe the bank $100,000,000 the bank has a problem."

This is one reason why thinking that China will stop buying US debt is crazy. They are simply in too deep and have no choice anymore.
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Old 07-13-2009, 11:46 PM
 
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Well when we end up like argentina come back and say that. Just look at germany after WWI as a example.China is just like the bank loaning money to the store going banlrupt;if the store goes under the own the storewhich was put up as assets.
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Old 07-14-2009, 12:35 AM
 
Location: here.
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McCain or anyone else in the White House today, the deficit would have been over 1 trillion...more likely over 1.5 even with a republican in the white house...
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Old 07-14-2009, 06:14 AM
 
Location: Seattle, WA
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At this point we are talking about real money in the economy. What I am worried about is when we do have a real recovery and all the money deployed in the system is going to speculate somewhere and that is going to lead to some serious price inflation. The counter-argument is that so much credit has been destroyed that we have deflation instead and many equity prices have to come down to proper price/earnings ratios and bond yields have to go up.
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Old 07-14-2009, 03:16 PM
 
17,751 posts, read 15,639,452 times
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Hi Kootr,

All money is debt. Take your pick. Its either consumer debt, business debt or government debt. Add it all up and that is the money. Since consumers are not buying business will not go into debt. That means government debt or depression.

The real problem in all this is the banks can't loose. They either loan at interest or if there are no takers, they have their agents in the government give them the money. I suppose another problem is is they give insiders so much money to cause inflation it will be stagflation for outsiders which for such an individual is having a personal depression while prices go up.
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