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Uncle Sam’s debt load amounted to 94% of U.S. gross domestic product in 2012, according to the World Bank. It now amounts to 103% of U.S. GDP. This ratio is sky high compared to its historical average of 61%.
U.S. government debt from 2010 through Sept. 2015. (YCharts.com)
Indeed the Federal Reserve fired up the printing presses, setting new records for U.S. money supply in 2013 and 2014. Forbes Welcome
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While I am not going to weigh in either way, it isn't hard to see the cogs and widgets that are in play. Rather than fixing what broke the world economy back in 2007/8, the power of printed money was used to double down and make the economy appear to be fixed. The same people who crashed the world are still in charge, nobody went to prison as they should have, and the few are still raping the many.
Uncle Sam’s debt load amounted to 94% of U.S. gross domestic product in 2012, according to the World Bank. It now amounts to 103% of U.S. GDP. This ratio is sky high compared to its historical average of 61%.
U.S. government debt from 2010 through Sept. 2015. (YCharts.com)
Indeed the Federal Reserve fired up the printing presses, setting new records for U.S. money supply in 2013 and 2014. Forbes Welcome
_______________________________________________
While I am not going to weigh in either way, it isn't hard to see the cogs and widgets that are in play. Rather than fixing what broke the world economy back in 2007/8, the power of printed money was used to double down and make the economy appear to be fixed. The same people who crashed the world are still in charge, nobody went to prison as they should have, and the few are still raping the many.
It's not the highest in history. The debt was 120% of GDP after World War II. How did we ever survive?
I think those that have debt fetishes need to get a grip.
During the Great Recession the government increased spending and revenue fell. Expanding the money supply and deficit spending is what the government is supposed to do in an economic crisis.
Yes it will crash, but when is the question. This is the boom phase of the cycle with bubbles all over the place and the hangover will come as it always does. Thank you fed.
The interest rates are too low, You simply can't have an economy with interest rates almost at zero. If Fed allows interest rates go up, then you can expect a deeper recession. Banks are going to fail.
I think stock market is going to get much worse before it gets better.
In the U.S. you cannot keep living like you have twice the income that you really have. Just trying to throw more money at the problem like our government has been doing will just make matters worse in the long run because this nation cannot afford to take on more debt. Passing the costs to some future generation is simply not possible. No future generation can possibly pay your huge rapidly increasing debt and soon nobody will be stupid enough to continue to finance our increasingly risky debt at the abnormally low interest rates that came about by illegal actions of the Federal Reserve.
Another reason for the lack of quality jobs is that the government cannot institute a policy to buy American or they risk a trade war with other nations in the global economy that are also living beyond their means. The trade war probably is coming anyway because unemployed people of nations will demand that their government do something to protect their jobs and all government can do to keep jobs at home is to allow protectionism. (remember, not just you, but everybody else in the world) It is going to be pretty bad when trade wars start. There will be no winners, only survivors.
Lose Lose situation. I am not optimistic about the future economy.
No competition from other countries. Their manufacturing infrastructure had been destroyed.
Sorry, but that's bad history and very bad economics.
On the history: the great postwar boom wasn't just a few years after the war; it was a whole generation long, from 1947 to 1973. That's well into an era in which Europe had very much recovered. West Germany's GDP per capita went from 45% of US GDP per capita in 1950 to over 75% by 1960. By 1970, it was over 80%.
The Europe-in-ruins era was long over while the US boom was still going strong.
But the bad history is incidental; the really key point is that this is nonsense economics. Yes, our competitors were in ruins for a while; but those competitors were also our customers. Basically, we had nobody to trade with.
The Marshall Plan caused a brief surge in exports in the late 1940s. But through the 50s and 60s America essentially did very little trade, exports or imports. If you think that's good for the economy, you should be all for extreme protectionism.
Essentially, the U.S. never paid-off the World War II debt, of about $220 billion. The economy grew faster than deficits, so debt:GDP shrank to negligible levels/
The interest rates are too low, You simply can't have an economy with interest rates almost at zero.
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I don't see how interest rates low hurts an economy. This allows businesses to borrow and invest in new plant and equipment, consumers to buy cars and houses at lower rates, etc. What it does do is limit bank profits, who make more money when there is a bigger spread between what they lend and what they borrow -- and that's where the big push to raise rates is coming from -- the bankers.
There is only two reasons for rates to rise 1) inflation; 2) the economy overheating. We have neither condition right now.
Yes it will crash, but when is the question. This is the boom phase of the cycle with bubbles all over the place and the hangover will come as it always does. Thank you fed.
LOL! There are no cycles and there are no bubbles. There aren't any witches or goblins either.
No competition from other countries. Their manufacturing infrastructure had been destroyed.
And it was rebuilt quite quickly. The myth of some natural US ascendancy in the post-war years is stuff and nonsense. In fact the late 1940's and virtually all of the 1950's were difficult times for the US.
Although many enough ardently long for such things, low interest rates today are not some harbinger of doom. They are a reflection of the slow pace of recovery caused by the refusal of Republicans to support such a thing.
Last edited by Reynard32; 11-08-2015 at 11:32 AM..
Sorry, but that's bad history and very bad economics.
No, it's not. Read any book discussing U.S. economics and/or business management during that time period. They all attribute the U.S.'s economic growth to the lack of competition from the other industrialized countries which had severely damaged infrastructure and manufacturing capacity after WWII.
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U.S. government debt from 2010 through Sept. 2015. (YCharts.com)
