It Is Now Mathematically Impossible To Pay Off The U.S. National Debt

[dewton]

Quote from Martinghoul:

How much US govt debt is monetized by the Fed as a proportion of the total US govt debt, do you know? Has the Fed always monetized US govt's debt?

Really? You don't say?! I'm scandalized! Banks borrowing money from the Federal Reserve! What's the world coming to? What's next? Britney and Justin back together?

Do you happen to know how banks can borrow from the Fed? Do they have to give the Fed something in exchange?

let me just keep it short and simple: at least 25% of our GDP goes towards paying interest on debt. that's our money that falls into the banking cartel's hands. thats our sweat and blood that falls into the hands of people who produce nothing of tangible value. that's straight up slavery. in light of this, the mechanics of how the "beast" works is irrelevant.

if you don't see this, then i'm not the one who's blind.

 

[endsongs]

Well, even with the Fed funds rate at ~0.0%, the average interest rate on US govt debt is around 3.3%. If the Fed raised interest rates to a normal level of ~ 4%, the total interest payments would almost double two years after the rate hike, after all of the short term debt rolled over. This would cause deficit projections to increase by at least 40%.

The question people need to ask is could we even afford the interest payments with our current rate of tax collections? And keep in mind that Social Security was insolvent last year ( paid more than it took in). Soon, Soc. Sec. will start redeeming those full faith and credit IOUs for the trust fund money that the gov't has already spent on other items.

 

[JSSPMK]

Quote from Halal Burger:

This will lead to war. I don't know how but it will......

sponsored provocation...response...war

 

[failed_trad3r]

Quote from PocketChange:

This is because we are the only conquerors in the history of war to not rape and pillage the wealth and riches of our adversary or enslave and tax our enemy. ie. the Brits, Romans, Spaniards and Germans all have expanded through war bettering their position.

After we destroy our enemy, instead of riches we foot the bill again and pay for their restoration. We have at least three undeclared wars: Iraq, Afghanistan, Pakistan...

All we need to do is garnish 50% of their citizen wages and their GDP until all of our war debts with interest is satisfied. In effect, we must enslave the enemy and slowly over 50 - 100 years assimilate them into our collective democracy.

In our "Home of the free" country only US citizens are enslaved, having 50% of their wages garnished in the form of various taxes or face prison.

this DOES make sense

however, if russia can default on it's debt, so can the US!
oh wait, they have oil and gas...

 

[Martinghoul]

Quote from dewton:

let me just keep it short and simple: at least 25% of our GDP goes towards paying interest on debt. that's our money that falls into the banking cartel's hands. thats our sweat and blood that falls into the hands of people who produce nothing of tangible value. that's straight up slavery. in light of this, the mechanics of how the "beast" works is irrelevant.

if you don't see this, then i'm not the one who's blind.

Right, I see... So I guess that means myself, as well as my elderly parents, are all members of this mysterious banking cartel then. 'Cause, guess what, I actually own some treasuries (mostly, TIPS, but also some conventionals) and so does my family. We are those evil people that receive our share of the GDP that goes towards paying interest on debt, aka your sweat and blood. I assure you, on the other hand, that I produce all sorts of things of tangible value, although it would depend on your definition of value.

Now please do explain to me what is so horribly wrong about this? Why should I not receive interest on money I have personally earned and then lent to the US government? That's my sweat, blood and tears we're talking about here.

 

[Lethn]

I don't think the U.S government should be allowed to borrow money to begin with, this whole system is horribly flawed and ready to break.

There's nothing wrong with what your saying from a purely technical standpoint, but you have to bear in mind that a government can only steal. It doesn't earn, taxes are just a fancy word for piracy and thievary. This is why people are getting so angry over it as the system has finally been exposed for what it is.

Now if the government were paying you back for money that they themselves earned then it would be another matter entirely, but that isn't the case at all.

 

[nickdes]

Very interesting, I wish I could comment on this, but I don't want to sound ignorant. : )

 

[Martinghoul]

Quote from Misthos:

MartinG - you are correct, and yes, many here are misinformed about the Fed. However, their concerns are not baseless.

I believe you are being disingenious by stating traditional Fed operations without mentioning the recent extraordinary Fed actions.

Didn't more then just the traditional banks have access to the Fed Window?

What did the Fed purchase from those that went to the window and who determined the price?

Is it normal for a Central Bank to flaunt securities regulations and to arrange shotgun marriages between institutions with little transparency? Who paid the price for those sham "marriages?" Who gained? How were losses and gains allocated?

I appreciate your efforts in articulating the traditional role of the Fed. But these are not ordinary times, and people have a right to ask for answers.

Many posters on this thread may be misinformed, but they rightly smell a rat nonetheless... I'm not so sure you do.

Misthos, we have argued about this before. My view is that you're smelling the rat in the wrong place, but that's a different discussion.

All I am saying in this here thread is that blaming the Fed for the US national debt is absurd. It's even more absurd to claim that by abolishing the Fed, the debt issue will somehow mysteriously disappear.

Let me leave you with this chart:

 

[Lethn]

The problem is not the federal reserve itself, the problem is our entire monetary system. The federal reserve however is making the system even worse by giving the government access to all this easy money which eventually is going to blow up in our faces.

 

[dewton]

Quote from Martinghoul:

Right, I see... So I guess that means myself, as well as my elderly parents, are all members of this mysterious banking cartel then. 'Cause, guess what, I actually own some treasuries (mostly, TIPS, but also some conventionals) and so does my family. We are those evil people that receive our share of the GDP that goes towards paying interest on debt, aka your sweat and blood. I assure you, on the other hand, that I produce all sorts of things of tangible value, although it would depend on your definition of value.

Now please do explain to me what is so horribly wrong about this? Why should I not receive interest on money I have personally earned and then lent to the US government? That's my sweat, blood and tears we're talking about here.

there's nothing wrong with people lending each other money. people can't create money and can only earn it. but how fair is it, if i created money out of thin air, lent it to someone at interest, and pocketed the interest as my profit? (this is precisely what the private Fed does). the fed lends the principle and asks for the principle+interest. our money supply is composed of the lent principle. but the principle+interest is being sucked back into the Fed-which forces us to borrow exponentially more over time. as our debt levels go onwards to infinity, all our money supply will be used towards servicing the debt that the Fed created. in short, the borrower is servant to the lender, and we're all slaves to the people behind the Fed.