Thursday, September 15, 2011

The US WILL Default

If you believe that our leaders have even the slightest clue of how to solve the economy's problems, Obama's jobs proposal should rid you of your delusion.

This is not a matter of political affiliation nor is it an attack of Obama as a person. It's a simple matter of basic math.

Obama wants to spend roughly $500 billion to create two million jobs (that's the claim at least). Put another way, Obama would spend roughly $250,000 to create a single job. That's a heck of a lot of money in an economy in which the average income is $50K or so.

That's just the basic math. I'm not even bothering to assess the fact that the Government is already spending over $1 TRILLION per year and hasn't created a sustainable job recovery.

So how exactly will another $500 billion change things?

Also, where is the Government going to come up with this money exactly? Didn't we just say we needed to hike the debt ceiling by another $500 billion? Aren't we already running Debt to GDP and Deficit numbers that are on par with Greece: a country that is guaranteed to default in the near future?

Folks, this is the hard truth: the US is broke and our leaders have no clue how to solve any of the structural issues our economy and markets are facing. They've spent TRILLIONS propping up the stock market but haven't created new jobs nor have they improved Americans' quality of life in the last two years.

In other words, we're at the End Game for Government Intervention in the economy and marketplace. Greece has already shown us what's coming: default and debt restructuring.

After all, there are only two ways to deal with a debt problem:

1) Pay it off

2) Default

The US has no chance at all of ever paying off its debts, which means some form of default and restructuring is coming our way in the future. And when this hits, it will make 2008 look like a picnic.

Comment:

Comrades, I really like this Graham Summers. He's not one of us, but he sure sounds like it! What's more, he's 110% right.

We can never pay off the debt. It's too high. If we were talking about an individual, the solution to the problem would be bankruptcy. Why not? Is it possible for an entire nation to declare bankruptcy? If it is, then we should do it.

The Judeo-Capitalists have made bankruptcy seem shameful. Like you're a deadbeat and a failure. Yet they don't hesitate to declare a Chapter 11 or 13 whenever it suits their purpose. Why shouldn't we? It's a legal right we all have when we get in too deep.

The United States has been in too deep for decades. If bankruptcy is an option, then we should use it.

When the Depression hit in 2008, I was about to lose my house to foreclosure. I asked a lawyer which is worse, a bankruptcy or a foreclosure. They said a foreclosure is worse. So, I declared bankruptcy, and handed the house back to the bank, and got my five credit cards (about $10,000 worth of unsecured debt) discharged. It was a major weight off my shoulders.

I still had my mobile home so I just moved back. No sweat. Well, yes sweat. Moving always works up a big sweat!LOL I lived without credit for about a year. Hard, but not impossible. I simply lived within my means, as we all should do all the time. No real hardships, no shame.

After about a year, I was offered a Mastercard with a $300 limit. It was for people who have recently been through a bankruptcy. I kept my balance low. Made more than minimum payments, and a year later, I got another card from a different bank. I now have two, and I won't get another. One card has a zero balance, and the other has a balance of about $200 from extra expenses I ran up when I went to the conference in Laurens last July. I should have it paid off by the end of this year. I will never allow myself to get into the credit trap again. Neither should anyone else.

Unless we, and that includes the government all learn to live within our means, we'll be forever doomed to economic slavery, which is exactly what the Fat Cats want.

6 comments:

  1. Dan, in personal finance class we were taught never to charge what you can't pay off within the next month. The best time to purchase a vehicle is in September. They are anxious to get rid of the cars because they have a new shipment coming in so you'll get better deals.

    Doing this for a period of 6 months will raise your credit limit to 500 then to 1500 faster than charging and then paying off in 4 or 5 months. I had several credit cards and I did just this and it worked. However, I am a lot like you, I do not want to pay the interest so I seldom charged anything that I could not pay off within a couple of weeks. Of course I had a great job back then so it was very easy to do.

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  2. Dan, I'll send ya $200 to pay that card off. I guess your p.o. box on this site is where I should mail it to.

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  3. Dan, in my case I lived in an apartment in the city where I worked. I had money up ying yang because it didn't cost a lot to live there and I made that kind of cash as a paralegal. However, I made a difficult choice the moral or right thing to do I suppose to come back to mother who was dying. I took a lesser job as a medical assistant. Within two weeks of letting my career go, my mother died.

    I got the house and I'm sure you'll find this funny to poke fun of my book smarts because I was absolutely horrible as a first time home owner. I didn't even know that I had to flip the switch to turn on the air conditioner. I thought since it was a central heat/cool unit that it was supposed to come on automatically. Yeah, I called a service man over here who asked me if I had turned the switch on. He turned it on and wa -la! LMAO!

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  4. -------------------------------------September 15, 2011 at 10:02 PM

    12:15 AM - If I could afford to pay it off every month, then I would have been able to save for the trip completely and I wouldn't have needed any credit. I would have used my debit card and saved the finance charge. I know it's only a few bucks a month, but a buck's a buck.

    I'll probably have it paid off by November. December for sure. Remember, November only about six weeks away. Two more $100 payments and I'm done.

    12:18 AM - Gee thanks!

    Sorry to hear about your mom. As to the AC switch, I've made a few dumb mistakes like that.

    I got a good one too. One night, just before bed, my computer froze up. Control/Alt/Delete did no good. So I turned off the switch on the back of the computer. I realize you can damage your computer doing that, but I couldn't think of anything else to do.

    Anyway, I left the switch in the off position and went to bed. I got up, got ready and went to work. After a night's sleep and a day's work, I forgot about what happened the night before. I go to turn on my computer, and of course nothing happen. My first thought was I f-ed up my computer by shutting it off like I did. I forgot about checking the switch in back. I pack it up, and took it to my computer repair guy. He takes a five second look and says, "You have your switch off." He flips the switch, and hits the on button and bingo! It comes on. I felt pretty damn stupid standing there. At least he didn't charge me anything.

    Dan 88!

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  5. Dan, it sounds like your pc is running out of virtual memory thus causing the freeze up. Yeah you should power down the pc and unplug the cord before flipping the voltage switch in the back of the tower.

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