It only took us 2 months to rack up another trillion dollars of debt and that is with the government shut down and tariffs being collected.

August when we crossed $37 trillion, they said it would be November before we crossed the $38 trillion mark, but we crossed it Wednesday.

I remember a financial professor once saying, "Sometime a financial crisis takes longer to happen than you expect but when it does, events unfold quicker than you expect or can react to."

Diversify and prepare, my friends.

Someone check my math….

100,000 seconds is 27+ hours
1,000,000 seconds is 11.5 days
1,000,000,000 seconds is 11,574 days or 31 years
One trillion seconds is 31,709.79 years
We are 38 trillion dollars in debt and adding one trillion every 100 days. That’s 3.65 trillion dollars a year.

How long will this continue before a correction is imposed? What form will that correction take?

Firm belief the dollar is going to be replaced with a Stablecoin which is backed by US treasuries. This way every dollar you earn, own, or saved will go into backing and buying our debt.

quote:

Originally posted by fischtown7:

I remember a financial professor once saying, "Sometime a financial crisis takes longer to happen than you expect but when it does, events unfold quicker than you expect or can react to."

Diversify and prepare, my friends.

Hey, how did you loose all your money?

Well, at first it was a dollar here, a few dollars there, then a few more dollars, then all of a sudden, everything happened at once.


^^ I forgot where that’s from, but damned if that ain’t true.

You can thank Biden for this mess. Give the tariffs and Trump's other policies time to play out for a few years and that figure will likely be a fraction of what it is now. Tariff revenue alone should cover most of our debt obligations.

I may be misinformed or misinterpreting tariffs...but if a manufacturer must pay some tariff on all goods exported to America, doesn't that tariff raise the price of the goods? If so, don't we pay the tariff each time we purchase the goods?

If there were alternatives to the goods, then the free market should drive the purchases to the lowest cost or best value good. But, in the case of single source goods (like iPhones, Galaxy's) it seems the consumer pays the tariff.

So, if we are paying the tariff fees, essentially, then we are paying down our own national debt. I think?

Tariffs are collected from US consumers buying foreign goods, that goes to our government.

quote:

Tariffs are collected from US consumers buying foreign goods, that goes to our government.

They are actually paid by the importer at customs. They are usually, but not always, passed along to the consumer.

quote:

Originally posted by chellim1:

quote:

Tariffs are collected from US consumers buying foreign goods, that goes to our government.

They are actually paid by the importer at customs. They are usually, but not always, passed along to the consumer.

In my employer's case, those fees are definitely being passed to the consumer (the company). I don't know yet how much of that gets passed along again to our customers, but I do know we've been told there will be no raises nor bonuses in the coming year, due to the costs of tariffs and fees.

quote:

Originally posted by fischtown7:
This way every dollar you earn, own, or saved

... will be tracked, and our activity used against us.


(That's not pessimism, just general distrust of The System.)

The tariffs are 100% passed on to the consumer, just like corporate taxes are passed on to the consumer. If not, the business will cease to exist in short order.

quote:

Originally posted by Carpentermaass84:
You can thank Biden for this mess. Give the tariffs and Trump's other policies time to play out for a few years and that figure will likely be a fraction of what it is now. Tariff revenue alone should cover most of our debt obligations.

Unfortunately that has yet to be the case, the tariffs have helped reduce the deficit from 2.1 trillion annually to 1.8 trillion. We are still going to need 30percent growth and 30 percent increase in taxes for 20-30 years to reduce our deficit.

With the magic of compound interest math working against us (i.e. generating more debt by not paying the debt, nor the interest, and then not paying the interest on the interest, etc.) we get into exponential growth.

TL: DR - the sky is the limit.

quote:

With the magic of compound interest math working against us...

We are screwed.

The stock market keeps hitting new highs. Which makes anyone with an investment account happy. Until you realize that 15% growth is just keeping up with inflation. Soon enough, it won't keep up with inflation.

If you stacked $1 bills,

37 x 10^12 /0.0043 thickness of a dollar bill
/12 to give you ft
/5280 to give you miles
/186000 miles/sec speed of light
/60 sec/min
/60 min/hr
/24 hrs/day

it'd take light ~8 1/2 days to reach the other end... Let that sink in.

quote:

Originally posted by darthfuster:

How long will this continue before a correction is imposed? What form will that correction take?

Read the book The Mandibles.

Congress is where all government spending originates. Congress never does the right thing until forced to. I remember back more than 50 years of discussions about the deficit and debt, so our predicament is no surprise.

I believe we entered the incipient phase of the death spiral about 20 years ago, since just before the Great Financial Crisis or maybe back to 9-11. Meaning that up until that time we could have continued without correction and been ok. Some small debt is ok, and with some growth and a robust economy it was sustainable. Like carrying $500 perpetually on your credit card, it isn't awesome but it is sustainable.

But once in the incipient phase you must correct or it will increasingly and more rapidly get worse. That's where we were for about 10 years, in the incipient phase. The national debt was still solvable. Social Security was still repairable. Culture was still preservable. But only with firm correction.

Now we are in the developed death spiral. It can be rescued before total destruction, but at a significant cost. It appears aside from Rand Paul nobody in Congress cares to apply correction before total destruction.

I believe Trump is looking to step off of this wreck by transitioning to effectively a new currency via slight of hand. Something digital. The debt will be inflated away with interest rates kept well below the inflation rate.

But there will be great pain as some form of spending reduction must also happen. I expect severe civil strife and government services failures.

tldr: Inflation plus violent confrontation between producers and dependents.

quote:

Read the book The Mandibles.

I think I will...

The Mandibles: A Family, 2029-2047 by Lionel Shriver – review

This biting near-future satire is played out amid a chillingly plausible US economic collapse

https://www.theguardian.com/bo...g-near-future-satire

quote:

Originally posted by mjlennon:
If you stacked $1 bills,

37 x 10^12 /0.0043 thickness of a dollar bill
/12 to give you ft
/5280 to give you miles
/186000 miles/sec speed of light
/60 sec/min
/60 min/hr
/24 hrs/day

it'd take light ~8 1/2 days to reach the other end... Let that sink in.

Last comparison I heard was the dollars stacked would do 7-8 round trips from the earth to the moon.

Every tax-paying adult (~110 million) owes over $370,000 to the government. I'm gonna need a payment plan

quote:

Originally posted by SigSentry:
Every tax-paying adult (~110 million) owes over $370,000 to the government. I'm gonna need a payment plan

See, the thing is that no one voted for deficit spending. Only Congress does, but no one ever ran for Congress promising deficit spending. They all say they are going to do something about it... but they don't.

I have told my kids: eventually your generation is going to become so beholden to this debt of your parents and grandparents generation that you become fed up with it. Your generation will figure out that it's not your debt and you aren't going to pay it. At that point, it (Treasury bonds) will become either worthless or settled for pennies on the dollar.

That's a better outcome than currency collapse.

I've been hearing about the debt induced collapse for my entire life and it never happens. I don't know what the answer is, but its clear Americans love their free shit. And, both parties have been the problem for the last 25 years.

quote:

Originally posted by goose5:
I've been hearing about the debt induced collapse for my entire life and it never happens. I don't know what the answer is, but its clear Americans love their free shit. And, both parties have been the problem for the last 25 years.

The math has become exponential, whereas before it was linear. The Treasury is rapidly buying back long term debt and replacing it with lower interest rate short term debt, which sounds good until the interest rates rise and that debt has to be refinanced. To erase the debt, inflation needs to be high, because there is no way to pay off the debt with the current value of the dollar. But high inflation normally leads to higher interest rates by the Fed to bring inflation under control.

So the future would seem to include artificially low interest rates to allow the government to service the debt, but not restraining inflation. Inflation will be fueled by printing dollars into existence. Thus the value of the dollar falls faster, which hurts the citizens. Also, the dollar denominated value of investments goes up due to the value of the dollar dropping, triggering taxes when those investments are sold. Your home, your retirement savings, etc. You end up paying taxes on the inflation.