Is the US bankrupt?

Daal wrote...

The change can be made through cutting taxes on investing and saving to decrease the consumption culture and encourage production, cut government spending on the entitlement programs to pay for those.
Any politician who tries to run on this base will be destroyed by the leftwing media and the democrats. I say learn chinese

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Excellent Commentary...

Yes taxes are an add on cost that certainly effects productivity...

This is why it is absolutely imperative for the US to establish a simple form of consumption tax....with no further type of taxes..

The simple reason is Globalization....This is one of the costs that have to come into line...and can further equilibrate the Chinese costs...

I would suggest another cost to be adjusted is legal largesse...
ie Paulson at this moment is asking for the relaxation of Sarbanes Oxley etc...

I would suggest that legal largesse be corrected first because this can be done with the stroke of a pen...and does not require 20 year changeover periods ie FORD plants etc....

Absolutely....correcting LEGAL LARGESSE and TAXES would go a long way towards making the US more competitive ....

Do you really think that the labor in China...and the land in China is that different ?....or can the advantages be related to items such as TAXES...LEGAL LARGESSE...etc.... Or does the US want to make sure that the tax picture and legal picture is the same in other countries ?
 
"....The simple reason is Globalization....This is one of the costs that have to come into line...and can further equilibrate the Chinese costs..."
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Globalization is the reason why Ford lost it's automobile business in China; guess what happened, China is planning to export 100,0000 car next year using Ford's manufacturing and what happened to Ford, you know the story.

The story will go on and on to other key technologies as well; aerospace business, missiles, satellite... We are losing the edges every second. Globalization comes with a great cost, we are losing critical technologies faster than you can imagine.
 
Quote from Pekelo:

Quote from Artie21:

How can anyone suppose America is bankrupt?

The assets of America so greatly outstrip its debt that the question is inane.

You mean as long as the EPA is protecting lands as collateral?

Why should the average citizen sell his house to pay off the government's debt?

The United States earns more from its foreign investments

Like what? Care to list some of those?

than it pays out on its debt intruments - public and private -

We don't care about private debt here, only the government's debt.

So you are saying the US has a way more than 3 billion a day (that is just to cover the interest on the debt) money inflow? Care to list those investments?
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Bankruptcy occurs when debt is no longer serviceable and the assets outstrip liabilities. Under this definition, the United States is not bankrupt. In fact, not even close.

Re: earnings on foreign direct investment: The statistics are all at the BEA. That's Bureau of Economic Analysis.
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I just love when someone gives me help to refute him!

Quote from Artie21:

Re: earnings on foreign direct investment: The statistics are all at the BEA. That's Bureau of Economic Analysis.
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OK, I went to their website:

Latest news release -- 6/29/06
The U.S. net international investment position at year end 2005 was -$2,693.8 billion (preliminary) with direct investment valued at current cost, as the value of foreign investments in the United States exceeded the value of U.S. investments abroad.

In my book that is one fucking big negative position, but hey, I only have 3rd grade education... :)

And they probably haven't even added the Iraq war as cost...

P.S.: For extra credit:

Latest news release -- 11/9/06
Total September exports of $123.2 billion and imports of $187.5 billion resulted in a goods and services deficit of $64.3 billion. (Joint release with the U.S. Census Bureau)
 
Quote from HoundDogOne:

I don't have to read another Chicken Little paper by a guy who's never left the Campus...
Because business is war... not some theoretical textbook sh*t.

In the 70s... the Saudis were gonna own all of America using oil revenues...
In the 80s... the Japanese were gonna take over the US using export revenues...

And what happened in each instance?

The Foreigner bought HIGH... and sold LOW...
And Americans lined their pockets.
It was all a one way, win-win deal from Day One.

The idea that a Foreigner can profit over Locals is ** laughable **...
Just try going to Loiusiana or Russia and taking out some wealth...
A judge or jury will stick you with a judgement that will bankrupt your company in no time...
And then the Tax Department will pick your bones...
And you will be lucky to avoid Hard Time.

In terms of the US deficit... Americans are IN CONTROL...
And the Creditors carry all the risk... not the Debtor...
In reality... unlike what you might read in an economics textbook.

Economists that have never run a global business... should simply be ignored.
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All I want is a buying opportunity, not some dip, I want a major correction, some real fear. Buying today not for me.
 
Quote from Pekelo:

I just love when someone gives me help to refute him!



OK, I went to their website:

Latest news release -- 6/29/06
The U.S. net international investment position at year end 2005 was -$2,693.8 billion (preliminary) with direct investment valued at current cost, as the value of foreign investments in the United States exceeded the value of U.S. investments abroad.

In my book that is one fucking big negative position, but hey, I only have 3rd grade education... :)

And they probably haven't even added the Iraq war as cost...

P.S.: For extra credit:

Latest news release -- 11/9/06
Total September exports of $123.2 billion and imports of $187.5 billion resulted in a goods and services deficit of $64.3 billion. (Joint release with the U.S. Census Bureau)
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I love when a moron steps in his own shit.

The earnings on those investments runs net positive for the United States.

Keep at it, you will make it to the 4th grade one day. Where's your mother, btw?
 
Quote from Artie21:

How can anyone suppose America is bankrupt?

The assets of America so greatly outstrip its debt that the question is inane.

Incidentally, The United States earns more from its foreign investments than it pays out on its debt intruments - public and private - and what foreign investments in the US pays out of the country

The US has a net positive cash flow in this regard.
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Not exactly,

Most of those returns are manufactured mumbo jumbo by the paper pushers. You must be relying on that Dark Matter paper.

It makes sense, but it's all paper. It is happening due to the advancement of the financial industry and its heavy growth.

The fact is that USA would not be able to redeem all of its outstanding debt if it was all called on. This stands true for more than just US, more like the whole world. I doubt even the EPA land can support it.

It is true that US borrows at a lower rate and relends/reinvests at a higher, but at the same time, the government cannot keep operating without constantly issuing more debt. That's a key problem. That's why the consecutive debt ceiling raises are not a center topic in the media. Because it makes you think, if US is making all these great returns, why can't it stop borrowing?
 
Last I checked... US debt was AAA rated.
Pretty much eveything else lower... and riskier.

The people setting Debt Ratings are genius-level, objective, and ruthless...
And know more about this than all of you put together times 1000...
Or else their product would have no value...
In an ** extremely competitive ** Debt Rating industry.
 
Quote from HoundDogOne:

The people setting Debt Ratings are genius-level, objective, and ruthless....
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hohoho... that's why they assign AAA to 15x leveraged notes (CPDOs).
 
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