Debt, Debt, Debt.
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- aldebaran0
So what's it going to be?
1) America devalues it's dollar
2) America defaults on it's debts
3) QE3 is announced
- fadein110
I thought everyone on here would have watched Zeitgeist Addendum... interesting in its analysis of the system - particuarly how interest works... some v.naive people on here today.
- pr20
Here is how debt works.
A country figured out that next year their expenditure will be $120 but their income (taxes) will only be $100. That means they will be short $20, so they need to either print extra $20 (which they don't want to do as more $ in circulation means lesser value of each $1) or borrow the "missing" $20 from someone to balance their budget.
So they borrow $20 at %10 interest (%1 going to the middle man - the real winner here as they make tooooon of $ by simply connecting people who have some money to invest and people who need money).
So next year assuming their expenses will be similar they will have to come up with $120 (normal expenses) + $22 (debt + interest) = $142. But because they kept their taxes as last year their tax income is only $80 so that year they will have to come up with $62 they are short of! Which they borrow again at %10 interest. So yet another year if they don't do anything they will have to deal with: $120 (expenses) + $69 (debt + interest) = $189 with income of only $80/year!
So the country chooses to do some belt tightening ("austerity measures") and cut their expenditure for next year as they know that with only $80 of income they will have to pay back the $22 and still pay their expenses. So they slash their expenses to only $58 hoping that with income of $80 they will be able to pay expenses and the debt but by cutting the expenses by almost %50 they bring the economy to a standstill so instead of taking in the normal $80 in taxes they only take in $40 and out of that $40 they need to pay they $58 of expenses and $22 of debt (meaning they will be short of $40 - which in turn they have to borrow yet again - but this time at %20 cause the country is in financial trouble).
- Its a great system isn't it!
I love it!fadein11 - Brilliant. So all the time the money is going from most of the people and accumulating in a big pile at one end ? Where ?mikotondria3
- Its a great system isn't it!
- shade0
im just a rat what do i know
- shade0
oh yeah. EAT THE RICH
- formed0
It is possible to 'earn' your way out of a mess. As many (most, really) are advocating it'll be a balance of taxes and cutbacks, but most importantly we'll need the economy to grow (faster).
Better economy = more taxes = less debt. Go back and look at the Clinton years, it is possible to get to no/little debt.
Now, as far as those rich are concerned, that's beyond my comprehension how so many can vote R knowing that they are continuing to widen the gap between the 'have's' and the 'have not's'. Go talk to them.
All I can say is that the rich control the world, so why would they make themselves pay more? They've done a masterful job of creating more wealth for themselves while also gaining immense control/power of the world.
One big fucking mess, really, but until you either have tons of money or lotsa power, you are just a peon walking in line. Agree or not, like it or not, either way the wheel continues to turn, all you (or me) can do is work to get our little piece of the pie and try to encourage what little things we can.
It ain't simple, it ain't pretty and it ain't fair, but that's the world of economics and power and it, more or less, has always been like this.
- 74LEO0
the problem is the banks, big oil and foreign interests have all our money and they dont spend it here when they can live a lush life in another country.
WE ARE BEING USED LIKE SHEEP, SLAVES, DONKEYS etc!!!
- dude I worked like, 80 days out of the last year, speak for yourself.********
- what do you mean the public? 80 days isnt a lot correct?74LEO
- dude I worked like, 80 days out of the last year, speak for yourself.
- mikotondria30
Well fuck it, I'm not playing that game.
I'm going to live in a small house, earn only enough so I don't pay any tax and eat and entertain frugally. I'm not prepared to bust my ass and pay this money to the lenders as taxes. I'll grow my own food and just survive. I've been at some of my happiest when I've been broke, I know what's important in life. Fuck them, they gambled that I'd continue to want to strive to accumulate wealth and that they would make money from that. Tough tits, sirs and lady - you lost. Would you like some homemade soup ?- buy local buy american. im borderline shinto daoist anyway74LEO
- Right. Honestly we shop at farmers markets and spend leisure time working on creative stuff and cooking from scratchmikotondria3
- borderline shinto LOL. can we be friends?shade
- i'm with you mikoscarabin
- if this mentality prevails, the system will crumble (i'm doing the same). fuck "keeping up with the jones'"silentpost
- I hear ya, cabin in the mtns, lotsa booze, canned food, water, guns...just like we did 100 yrs ago!formed
- bring the jones's down to your level :)SlashPeckham
- Good luck buying land in the mountains without any income.404NotFound
- < lol have you seen land prices? good luckcannonball1978
- 74LEO0
The biggest scam was paying for a formal education only to be prepared to be added to the sheep. propping up a system that ultimately doesn't give a shit about me. I see it time and time again with my elders when they hit 65+.
Agree with miko live below your means, throw some money at apple and polish your craft!
- Yup, higher ed is certainly missing the boat. Trust me, after 7 years and 3 degrees, I hear ya!formed
- scarabin0
i'm just waiting for an excuse to start a hippy commune.
fuck having water and flashlights for emergencies, i've got a garage full of tools, supplies and solar panels ready to start a new eden somewhere when the shit hits the fan
- Free lovin'?formed
- no, the lovin's $2.99/minutescarabin
- lol @ hippy communepinkfloyd
- Fuck that im starting a regular communecannonball1978
- aldebaran0
I wonder what's going to happen to the price of gold. Will we see hyper-inflation and sky rocketing gold prices? Or will we see deflation and plummeting gold prices. Considering how much is on the ledger it seems unlikely that the Fed would allow deflation to occur.
- mikotondria30
ha! the old skyrocketing gold thing again. Hey my gold that I bought for $400 is now worth $1500! Brilliant ! I'll dump all my money into gold, then in the future I'll be able to get a higher number of dollars back.
However, those dollars will buy you less than you thought. Probably about the same amount of stuff as the original money would have bought you.
When you buy or sell gold or any other asset, someone sees your transaction as a way to profit. There are only people passing value between each themselves. Debt = wealth, the money always goes somewhere, where is this black hole into which all our money has gone ?- The wealth is in other countries. You don't think we owe ourselves, do you?404NotFound
- no, it's not - the whole is broke, everywhere has a massive deficit..mikotondria3
- scarabin0
the point in buying gold isn't to make a profit, but to protect your assets when the dollar loses its value
- <<<<aldebaran
- Yes, totally, I know. It's not being sold as that though.mikotondria3
- aldebaran0
The price of gold has sky rocketed since 2008 'cause of the feds QE1 & QE2 policies. Last week the Fed said there wasn't going to be a QE3, but if there is watch the price of gold & silver go through the roof.
- monNom0
"Who owns all this debt?"
if you have money in the bank, you do.
it's not just the richies that own debt, the vast majority is held in little bits by everyone with some savings.
- pinkfloyd0
All your debts have been melted, and fused into this one car
- utopian0
If you don't actually have the physical gold stashed in your basement and or under your mattress... But you made and online transaction with paperless money that is worthless to purchase the gold, where is the gold actually being kept? If the gold has not been hand delivered to you, you will never see the gold when the economy eventually collapses.
- aldebaran0
utopian you're touching upon an interesting topic. Many ETF Gold and Silver backed funds don't hold nearly their entire worth in actual assets. If there was a crisis you can almost guarantee that they would not be able fulfill all delivers, increasing upwards pressure on price.