Is the US bankrupt?
- Thread starter Pekelo
- Start date
I think the prime growth potential periods for the United States was the 30s to the 50s regardless of the leadership there was great potential. Unless there is some major breakthrough that gives the US some kind of edge over countries that currently have alot more growth potential. I think a big factor has been oil. At one time the US was an exporter of oil. Today as you know the US is the biggest importer. A lot of the success in the US has come from cheap growth. You can compare it to how Germany had certain resources and made them very powerful but of course it's more complex than that. The US Federal bank prints too much paper to finance debt because of the simple fact that it's lost it's edge. So as far as being bankrupt yes it already is. The US has also become a less desirable place to live and has dramatically gone downhill. We have not seen savings ratios this low since the great depression. It's obvious the financial sitiuation is very ill. Foreign investors still invest here but their are many other options for them to invest in more desirable places to live. It actually could be worse but the leadership is more stable than some lessor countries - I won't point any fingers though.
Neal
Neal
Oh man, I like your posts Hydroblunt, but a lack of cash flow doesn't equal bankruptcy when you have vast assets. Otherwise, I'd be bankrupt.
I'd gladly step in and take over the United States estate, even if that meant taking on their debt. I could sell off Mt. Rushmore, the statue of liberty, the grand canyon. I imagine waste managment would pay a pretty penny for that.But then, you cast doubt on dark matter, too.
All dark matter is is material that doesn't emit light, or reflect enough to see from our vantage point. The earth is dark matter. There are galaxies that are spinning so fast that they would fly apart due to centifugal force if it weren't for the gravitational pull of dark matter helping to hold them together. SM
Quote from piezoe:
Apparently it is possible for countries to exist more or less in a state of perpetual bankruptcy, Argentina being perhaps the most prominant example. Will the US will supplant Argentina as the most prominant example?
You got that dead wrong piezoe.
Private funds held offshore greatly exceed the national debt in argentina.
Argentino's have a strong national pride in many things, but in the serious matter of money they do not.
all this week, its been reported by the major national morning news agencies that the Europeans (British, Scottish, etc.) have been flooding NYC with purchases, visits, hotel room usage and such because the US Dollar is so cheap to their native currencies that they could never purchase as much goods and services at home, which makes coming here worth the trip.
US Tourism (right now) is and are reaping the benefits of the lower dollar.
Also, when the major trading partners refuse to unpeg their currencies (whether that's China, Hong Kong formerly, and other countries) to the US Dollar, then by devaluing the US Dollar it takes down their goods and services by raising their prices (read. bad for Walmart, Deere and others) and good for the US relatively. As well as it de-inflates their currencies relative to their non-compliance with existing trade arrangements and agreements.
Someone's alive and alert at the switch, it would seem....
Quote from Smart Money:
Oh man, I like your posts Hydroblunt, but a lack of cash flow doesn't equal bankruptcy when you have vast assets. Otherwise, I'd be bankrupt.
But then, you cast doubt on dark matter, too.
SM
LOL I was referring to the article that was posted on ET, it was called smth Dark Matter. Can't find the thread anymore but I have a copy for mysef. Basically states that the deficit is actually covered by all these returns, which they called Dark Matter. It's an interesting concept. They give a few examples, such as US companies getting the sales & profits due to name recognition, etc, etc. It makes sense, I liked their idea, too bad most of these returns come from paper pushers which I consider a bunch of BS. They mentioned US owned assets and their return generation.
In reality, US Federal gov does not have nearly enough land to cover their debt. You have to remember that not all government land is attributed to the Federal level, there is the whole state vs federal thing. Its value is always in the eye of the beholder, but then we can't forget the real estate run up.
I place more value on the Armed forces than anything. But then, I think the US is as bankrupt as any US bank. Neither one can fulfill their obligations at the same time.