Showing posts with label Default. Show all posts
Showing posts with label Default. Show all posts

July 1, 2015

Time Runs Out - What Are We To Believe?

Time runs out, but we are still chasing highly elusive goals (just some examples): 

1) Iran - Time runs out on deadline for a nuke deal even after "the framework" was supposedly set three months ago. And as Iran's Supreme Leader and the Iranian Parliament chant death to America, can we really believe that Iran will ever truly give up their pusuit of nuclear weapons of mass destruction (and terrorism) to use on you know who?  


2) Greece - Time runs out on an extension of more Greek bailout funds, and they default on payment to the International Monetary Fund potentially leading to their exit from the Euro and the EU. With a Greek debt of $271 billion, can we really believe they will ever be able to repay this? 


3) Social Security and Medicare - Time is running out on the solvency of our own social entitlement system in the U.S.  For example, the Social Security Disability Trust Fund runs dry already next year in 2016, Medicare is exhausted by 2030 and Social Security by 2033. With just 16 and 19 years of funding left for these major programs that tens of millions depend on, can we really believe that magically we will dig our way out of this mega mess of a financial hole? 


4) Global Warming - Time is running out on cutting carbon emissions leading to global warming and catastrophic climate change. With global warming denial still in vogue and reluctance by the industrial nations to significantly cut back on emissions in time, can we really believe that catastrophic enviornment damage will be averted? 

5) War - Time is runing out as potential for eventual war looms on the horizon with China, says respected DoD Futurist, Peter Singer. With disputes in the South China Sea and with Taiwan, China bulking up on advanced weapons, and the U.S. pivoting to Asia, the fears of a serious confrontation are there. Similarly, with Russia and it's annexation of Crimea and ongoing fighting in eastern Ukraine, threats to it's Balkan neighbors, confrontations on the European borders, and an increasingly nuclear and militant Russia, the Cold War is heating up. The last world war ended 70 years ago, can we really believe that the peace will continue to prevail with powerful adversaries in turbulent and uncertain times? 


Yes, hopes and dreams are important, but real concrete action is too or time will simply run out and then what? ;-)


(Source Photo: Andy Blumenthal) 

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October 5, 2013

Debt Default--Now Or Later

So reopening the government, narrowing our deficit spending, and raising the national debt ceiling is coming together in planned negotiations this week. 

Despite all the talk, we continue to spend beyond our national means and basically we must raise the debt ceiling or else the game of borrow and spend is over. 

Almost like insatiable gamblers, we use up our money at the table, head to the pawn shop to sell our watch and car to replenish for the next game, and then borrow against our credit card to fuel our addiction to the game some more. 

Eventually though the house always wins and the borrower must pay up (or they get their legs broken or something nasty like that). 

So while the question posed by the pundits this month is whether the U.S. will default on its debt now, the real question is whether a default is just a matter of time anyway--as we continue to spend more than we generate in revenue as a country. 

Sure can we raise the debt limit again--hey, why not borrow more, if others are willing enough to lend to us (and for little to no interest too)?  

And can we through sequestration or more surgical spending cuts, decrease the rate of our deficit spending--however actually balancing our budget is not even on the table anymore, as booming entitlements for Social Security and Medicare are expected soon with the aging baby boomers to drastically increase our spending again. 

The hope that we will somehow, magically grow our way out is fanciful thinking--almost rising to delusions of national grandeur--that just don't mathematically add up (since we have a median GDP growth rate over the last 80 years of just over 3%). 

Perhaps, we don't care if we can't pay our debts, because we are the superpower and what is anybody going to do to us about it anyway?  

Or perhaps, we rely as a backstop on our ability to print more money and pay off old borrowed sums with worthless new money galore?

Maybe it's not a default if no one acknowledges it or we just get away with it...but somehow, someway, no one and no country can spend more than it generates in perpetuity.

If you believe in the endless virtual cycle of borrow and spend, then the mind control program is working just great, indeed. ;-)

(Source Photo: Andy Blumenthal)
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