Monday, October 21, 2013

US Debt out of Control

We discussed the US debt issue today during a round-table discussion and I think it is equally pathetic as humorous how the old brass of US politics runs around the world without shame claiming to be the world’s most powerful and prosperous country. I am not sure who is dumber; the old brass claiming that or the part of the general public who still believes it.

Look at the picture and see how the US debt has exploded under the current lack of leadership in the White House who decided to wipe his ass with the US constitution and laugh at everyone buying into the illusion. Please note that this only includes Dumbama’s first term which he defrauded US history with.

The second term may see two potential outcomes
  • US debt will eclipse $20 Trillion
  • US economy will collapse further
Either case is a bad outcome and trust by its foreign creditors almost wiped out. The US is on its way out to be the world’s reserve currency. It should have never became the reserve currency and as the US abandoned the gold standard forced its way on the rest of the world as it was at some point the most powerful country.

The chart shows that for over three decades the US was nowhere close to be powerful and prosperous and ran something equivalent to a Ponzi scheme with its creditors. Those who shake their heads in disbelieve right now picture the following scenario:
Your neighbor lives the most luxurious lifestyle in town. He borrows money from other neighbors every week and nothing he owns and spends is his own money. He borrows money from one neighbor and repays another one, the amounts borrowed increase with the trust as everyone was repaid so far, but his total debt continues to increase and so does his lifestyle.
Would you consider your neighbor smart, rich and powerful?

I hope you do get the point made here.

Look at the picture and ask yourself if your balance sheet would like that would you honestly applaud yourself and run around the world trying to force your approach onto others?

Think hard before you fall for the tremendous marketing machinery sponsored by the old brass who still holds on to an America which is long gone. There are plenty of ways to measure who is number one and the US only shows up as number one when it comes to total public debt.

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