When will our country financially collapse? (Reagan, Clinton, millionaire, military)

[SETI_listener]

Originally Posted by Opin_Yunated

No actually the petro dollar has more to do with being the reserve currency for the world than the U.S. ability to isssue currency. Why hasn't Japan collapsed yet?

And it is the world who issues us credit because they know we are the most stable source for petroleum products. Russia can try all they want to sell their oil in Euro or Yuan, but as long as we use our CIA to make Ukraine a cork in Europe-Russia pipelines and keep China happy in trade, nothing will come of it.

Japan is purely a banking issue. Their currency is traded like stocks. The Yen is faithful because Japan is industrious and keeps out of trouble.

[sholomar]

I think fractional reserve debt based currency is outdated and the system need changing... we dont really need to collapse we just need inflation that allows wage and gdp growth such that it exceeds debt growth.

I dont buy that we can continue going into debt at these levels with no consequence... a lot of the bears have been driven from the forums and you tend to hear only the people who say it will never happen... which tends to happen during times of stability. We've had downturns before that caught people off guard and will likely have them again when people least expect. Record margin levels in the market..
bubbles are being re-blown...

How are we supposed to pay for social security and medicare going forward with the aging boomers and low birth rates along with lower wages for the middle class? I dont live every day in fear but Im not naive enough to think nothing bad will ever happen. Chances are when something does happen certain people will be ready and positioned to profit from it ahead of time....

[itsjustmeagain]

If the USD looses Reserve Currency Status the US goes poof. No more large trade deficits and downsizing of America on a grand scale.

[tickyul]

Our fiat-currency is LIMITLESS.

The real problems is the type of society you build, when you can spend wildly, to prop-up and create more societal dregs.

[phma]

Originally Posted by stockwiz

I think fractional reserve debt based currency is outdated and the system need changing... we dont really need to collapse we just need inflation that allows wage and gdp growth such that it exceeds debt growth.

I dont buy that we can continue going into debt at these levels with no consequence... a lot of the bears have been driven from the forums and you tend to hear only the people who say it will never happen... which tends to happen during times of stability. We've had downturns before that caught people off guard and will likely have them again when people least expect. Record margin levels in the market..
bubbles are being re-blown...

How are we supposed to pay for social security and medicare going forward with the aging boomers and low birth rates along with lower wages for the middle class? I dont live every day in fear but Im not naive enough to think nothing bad will ever happen. Chances are when something does happen certain people will be ready and positioned to profit from it ahead of time....

I share every word of your opinion.

Dollar Hegemony,
And I would add that we will have a down turn and will need a bale out. With the world bank/IMF to the rescue with SDR and then we are on the hook to them like all the other third world countries. Shortly there after we will no longer be the reserve currency. Yeah, Yeah, Yeah, I know MOONBAT S**T crazy, Tin Foil BLAH, Blah,Blah, Dominoes fall knocking over Dominoes what a crazy concept.

In other respects, dollar hegemony went unchallenged during six decades because no competitive rival emerged, yet “ample evidence exists to suggest that the distribution of power in international monetary affairs is changing” (Cohen, 2008). Especially, the rise of the People’s Republic of China as an economic superpower has enhanced the possibility that the ‘Middle Kingdom’ could become, in the long run, a financial superpower (Makin, 2011). Naturally, “many PRC scholars and policy makers […] aspire for a world economic and financial order less dominated by the US and in which the PRC can play a more influential role” .

Accordingly, by proposing alternatives to the US dollar as reserve currency –like Special Drawing Rights–, “China desires to decrease the financial and political power of the United States” (Carbaugh & Hendrik, 2009) and, it has to be taken into account that “If any nation is in a position to use its newly acquired influence in this manner, it is China. At any time, Beijing could undermine America’s money by dumping greenbacks on the world’s currency exchanges or even simply by declining to add dollars to China’s reserves in the future” .

[BluntBoo]

I think these bubbles/pops are the present and future economic growth tools around the globe. A bubble is made followed by a short pop until another bubble gets blown, repeat. It is more fluid to maintain and re-grow than traditional economies, allowing for creation/development of markets and the consumers within them relatively easily. Fiat currency can be manipulated to cover expenses and non-existent funds can be borrowed/loaned thru conflated valuations. Should you care to know how so many places around the world are having such rises in affluence it is exactly because of this sort of 'voodoo' economics.

The real concern is as Greywar has mentioned: Technology. There is a time coming soon where we won't need people manufacturing things as machines such as 3D printers will do that from raw materials following a programmed schemata. A lot of people make their living making kitchenware, toys and other plastic things may not have much of a viable earning potential when it is decided they can be cheaply replaced with a machine.

[BluntBoo]

Originally Posted by tickyul

Our fiat-currency is LIMITLESS.

The real problems is the type of society you build, when you can spend wildly, to prop-up and create more societal dregs.

That's why we keep hearing about Ebola, bird flu, swine flu.... Well, I won't go on.

Or as Jack Nicholson's The Joker said in the Tim Burton version of Batman "This town needs an enema!".

When it's done let's hope Bruce ends up winning and not that clown!

[Hoonose]

Originally Posted by phma

I share every word of your opinion.

Dollar Hegemony,
And I would add that we will have a down turn and will need a bale out. With the world bank/IMF to the rescue with SDR and then we are on the hook to them like all the other third world countries. Shortly there after we will no longer be the reserve currency. Yeah, Yeah, Yeah, I know MOONBAT S**T crazy, Tin Foil BLAH, Blah,Blah, Dominoes fall knocking over Dominoes what a crazy concept.

In other respects, dollar hegemony went unchallenged during six decades because no competitive rival emerged, yet “ample evidence exists to suggest that the distribution of power in international monetary affairs is changing” (Cohen, 2008). Especially, the rise of the People’s Republic of China as an economic superpower has enhanced the possibility that the ‘Middle Kingdom’ could become, in the long run, a financial superpower (Makin, 2011). Naturally, “many PRC scholars and policy makers […] aspire for a world economic and financial order less dominated by the US and in which the PRC can play a more influential role” .

Accordingly, by proposing alternatives to the US dollar as reserve currency –like Special Drawing Rights–, “China desires to decrease the financial and political power of the United States” (Carbaugh & Hendrik, 2009) and, it has to be taken into account that “If any nation is in a position to use its newly acquired influence in this manner, it is China. At any time, Beijing could undermine America’s money by dumping greenbacks on the world’s currency exchanges or even simply by declining to add dollars to China’s reserves in the future” .

There are still no suitors yet on the horizon, and recent history suggests that more insecurity and turmoil in the world markets merely focuses more attention toward the USD and USD based investments. Will this change? Very probably. But soon, no.

End of U.S. Dollar Hegemony - Not | Michael Shedlock | FINANCIAL SENSE

[bruhms]

Who knows but at least we know it'll happen after Russia.

[Mircea]

Originally Posted by snuffster

Soon we'll be 18 trillion in debt, projected to be @ 20 trillion by the time Obama leaves office. Our national debt.....

Federal debt, komrade.

You live in a federal republic. There is no "national" anything.

The federal debt is solely the property of the federal government.

The States have no obligation to the federal debt in accordance with the US Constitution, and also in accordance with International Law.

Originally Posted by snuffster

My question is, when do you think the day will come when we can no longer just print money and the government will have nothing to spend?

That day will never come. You live in a fantasy world.

I'll explain how your world works.

Each fiscal quarter, your government takes the accumulated deficit, packages it as treasury securities, and auctions it off to bidders.

So long as domestic and foreign entities are buying your debt, everything is moldy tomatoes.

That raises the question, how much longer will domestic and foreign entities keep buying your debt?

The federal debt already exceeds 25% of World GDP. Soon enough, the federal debt will exceed 1/3 of World GDP.

A burnt pancake has the common sense to realize that is unsustainable.

At some point, the rest of the World will stop buying federal debt.

What happens then?

Then Monetary Inflation will start creeping into your economy.

How will you know when that happens?

Suppose the rate of Monetary Inflation is 10%. One day, you will walk into Kroger's or Wal-Mart or Macy's or McDonald's and you will notice that the price of everything, as in every thing, as in every single thing has increased by 10%.

In fact, the price of every single thing in the US has increased by 10%, except your wages, and your wages will increase by 10% within the following 9-12 months (with any luck sooner than 9 months but probably not).

That, is how you will know.

Originally Posted by snuffster

Because of course if/when that happens things like military retirees won't get their pension deposited at the first of the month, government workers laid off, the military in general will cease to function, ect, ect, ect..................................

That is not what happens.

You have confused the "debt ceiling" with "printing money." They are not the same thing.

The debt ceiling is a limit on the total amount of US treasury notes, bills and bonds that may be auctioned/sold.

If Congress does not raise the debt ceiling, then what happens? The government can still spend money, but it cannot sell treasury bills, notes or bonds.

Wouldn't that induce Monetary Inflation? Sure, but only by a paltry amount....at first.

The US would give the obligatory reassurances that everything is peachy, but there will still be a half dozen States or so that panic demanding immediate payment.

France holds $59 Billion in US treasury securities. They might demand payment in full, with interest, and cut their losses while they're ahead. That could start a run on the US.

Monetary Inflation would decrease the value of the US Dollar against other currencies, and harm the US economy.

Some big brain said US exports will be cheaper, um, no. With exception of agriculture and natural resources, the US can't export squat without first importing goods to create something to export. And the cost of importing things will be enormous, offsetting in any gain in exporting, perhaps even causing losses.

Some believe "The Day" has come.

In August 2013, the Kingdom of Belgium held $166.8 Billion in US treasury securities, and now suddenly Belgium holds $359.9 Billion.

That is an increase of 115.7% in a single year. That is highly suspicious.

Note that Belgium's GDP for 2013 was only $508 Billion.

In other words, the Kingdom of Belgium's US treasury holdings are 71% of their 2013 GDP.

That is completely illogical and not even possible.

If I would speculate, I would suggest that the purpose of QE (Quantitative Easing) was to pump up the banks with cash, which they have been sitting on, so that they can buy up US treasury securities through proxies, like the Kingdom of Belgium.

Economically...

Mircea