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June 07, 2010
U.S.'s $13 Trillion Debt Poised to Overtake GDP
Senator Jim DeMint (R-SC) explaining how over 90% of all bills passed by the senate are passed without being read, without being scored by the CBO, without being voted on, and totally in secret
“You don’t get thirteen trillion dollars into debt by doing things right,” he says.
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Barack Obama is poised to increase the U.S. debt to a level that exceeds the value of the nation’s annual economic output, a step toward what Bill Gross called a “debt super cycle.”
The CHART OF THE DAY tracks U.S. gross domestic product and the government’s total debt, which rose past $13 trillion for the first time this month. The amount owed will surpass GDP in 2012, based on forecasts by the International Monetary Fund. The lower panel shows U.S. annual GDP growth as tracked by the IMF, which projects the world’s largest economy to expand at a slower pace than the 3.2 percent average during the past five decades.
“Over the long term, interest rates on government debt will likely have to rise to attract investors,” said Hiroki Shimazu, a market economist in Tokyo at Nikko Cordial Securities Inc., a unit of Japan’s third-largest publicly traded bank. “That will be a big burden on the government and the people.”
Gross, who runs the world’s largest mutual fund at Pacific Investment Management Co. in Newport Beach, California, said in his June outlook report that “the debt super cycle trend” suggests U.S. economic growth won’t be enough to support the borrowings “if real interest rates were ever to go up instead of down.”
Dan Fuss, who manages the Loomis Sayles Bond Fund, which beat 94 percent of competitors the past year, said last week that he sold all of his Treasury bonds because of prospects interest rates will rise as the U.S. borrows unprecedented amounts. Obama is borrowing record amounts to fund spending programs to help the economy recover from its longest recession since the 1930s.
“The incremental borrower of funds in the U.S. capital markets is rapidly becoming the U.S. Treasury,” Boston-based Fuss said. “Do you really want to buy the debt of the biggest issuer?”
Wild Thing's comment.......
Just a passing thought but can you imagine a DeMint/Christie or Christie/DeMint ticket and Bachmann land Speaker of the House. heh heh
Jim DeMint is one of a handful that I think would do a great job in leading us to the restoration of our country.
Senator DeMint on the Bailout
We have seen this Government socialize our education system and make our schools among the worst in the world. We have seen this Government take over most of our health care system, making private insurance less and less affordable. We have seen this Government socialize our energy resources and bring our Nation to its knees by cutting the development of our own oil and natural gas supplies. And now we see this Congress yielding its constitutional obligations to a Federal bureaucracy, giving it the power to control virtually our entire financial system. Americans understand this and they are angry. They are our judge and our jury. They are watching what we are doing, and they will render their verdict based on our actions.
If we were honest with the American people and explained the failures that have led to this financial crisis, we might have the credibility to ask our citizens to allow us to borrow another $700 billion in their name to try to fix this problem. But we are not being honest. This problem was not created by our free enterprise system. It was created by us, the Congress and the Federal Government
....Thank you Mark for sending this to me.
Mark
3rd Mar.Div. 1st Battalion 9th Marine Regiment
1/9 Marines aka The Walking Dead
VN 66-67
Posted by Wild Thing at June 7, 2010 05:45 AM
Comments
Here's another bit of good news if you are a democrat. If your employer pays part of your Health Insurance per month, guess what, you just got a raise and that, what used to be called a benefit in now a liability. So in one year if your employer pays part of your insurance of say
$10,000 dollars that will now be considered INCOME and is taxable. That's hope and change??? A real change would be to give everybody the $10,000 dollar raise and let us buy our own Health Care but that would afford the individual too much freedom.
HOwever, if you belong to a Union your benefit of Health Care stays the same. Now isn't the obama Socialist system fair ?
This too will help drive down the total GDP and help accelerate the National Debt.
Posted by: Mark at June 7, 2010 08:21 AM
Mark, oh man this is so bad. Thanks for the information Mark.
Posted by: Wild Thing at June 8, 2010 04:20 AM
