|
|
09-12-2012, 07:49 PM
|
#61
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Apr 2003
Location: Hooverville
Posts: 22,983
|
Quote:
Originally Posted by scrabbler1
When I think about the consequences of a debt ceiling being hit, I recall what happened in New York City back in the 1970s. The city government had become accustomed to having area banks lend money endlessly until the banks shut their windows and stop lending. The city was only hours away from bankruptcy until it struck a deal with the unions and made some severe cost-cutting moves such an increase in the transit fare and to start charging tuition to attend city colleges.
The markets ended up forcing big changes to the business-as-usual, kick-the-can policies. I hope it doesn't come to that on the federal level.
|
I hope it does. New York turned a corner and never looked back.
Ha
__________________
"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
|
|
|
|
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!
Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!
You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!
|
09-12-2012, 08:13 PM
|
#62
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2005
Location: Lawn chair in Texas
Posts: 14,183
|
Waste, fraud, abuse, and earmarks need to be reined in, but without addressing the big three - defense, SS, and medicare, all else is whizzing in the breeze. All three have large, unyielding constituencies, though.
I doubt the "banks" will close their windows on the Fed Gov, but bond rates will likely go much higher eventually, which will make the other "biggie", interest on the debt, all the more intractable.
Defense is relatively easy to fix, as is SS, assuming the willpower to do it. Medicare will have to survive the baby boomers getting older and sicker, is ill prepared to do so, and no solution that isn't painful and costly exists, at least that I'm aware of.
The primary problem is the citizens who believe the politicians when they say taxes can be low and services high, no worries...
__________________
Have Funds, Will Retire
...not doing anything of true substance...
|
|
|
09-12-2012, 08:29 PM
|
#63
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2004
Location: SW Ohio
Posts: 14,404
|
Quote:
Originally Posted by Alan
It appears that from [the debt ceiling's] introduction in 1917 it has only ever been a political instrument and never actually constrained spending.
|
Let's not be too cavalier in denigrating "political instruments." The debt is a political problem and it will be solved through political means (maybe in response to apolitical economic factors).
|
|
|
09-12-2012, 08:56 PM
|
#64
|
Administrator
Join Date: Jul 2005
Location: N. Yorkshire
Posts: 34,128
|
Quote:
Originally Posted by samclem
Let's not be too cavalier in denigrating "political instruments." The debt is a political problem and it will be solved through political means (maybe in response to apolitical economic factors).
|
Since Congress sets both the budget and the debt ceiling I see no purpose in it since the decision is always on what the budget should be. If Congress decide on a budget that is larger than the debt ceiling then they raise the debt ceiling.
__________________
Retired in Jan, 2010 at 55, moved to England in May 2016
Enough private pension and SS income to cover all needs
|
|
|
09-13-2012, 08:14 AM
|
#65
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2006
Posts: 12,483
|
Quote:
Originally Posted by Alan
Since Congress sets both the budget and the debt ceiling I see no purpose in it since the decision is always on what the budget should be. If Congress decide on a budget that is larger than the debt ceiling then they raise the debt ceiling.
|
Sounds easy and logical, as long as the Chinese will continue to buy short-term T-Bills at negative returns, so far so good........
__________________
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)
This Thread is USELESS without pics.........:)
|
|
|
09-13-2012, 08:23 AM
|
#66
|
Administrator
Join Date: Jan 2008
Location: Chicagoland
Posts: 40,714
|
US public debt is caused not only by budget deficit but also trade deficit. China buys Treasuries to offset the trade imbalance. Domestic US demand from institutional investors and pension funds more than covers the need for budgetary deficit financing.
|
|
|
09-13-2012, 10:29 AM
|
#67
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2005
Location: Lawn chair in Texas
Posts: 14,183
|
Quote:
Originally Posted by MichaelB
US public debt is caused not only by budget deficit but also trade deficit. China buys Treasuries to offset the trade imbalance. Domestic US demand from institutional investors and pension funds more than covers the need for budgetary deficit financing.
|
The trade deficit is a topic that seems to be missing from the discussion when talking about keeping jobs and manufacturing in the USA. Not to mention the industrial espionage and the blatant copyright/trademark/patent infringement of a certain "trading partner"... Of course, crude oil accounts for a fair amount as well.
http://www.census.gov/foreign-trade/...t/deficit.html
__________________
Have Funds, Will Retire
...not doing anything of true substance...
|
|
|
09-13-2012, 10:41 AM
|
#68
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2008
Location: NC
Posts: 21,303
|
Quote:
Originally Posted by HFWR
The primary problem is the citizens who believe the politicians when they say taxes can be low and services high, no worries...
|
Don't know who originated it, but ' politics is the art of bribing people with their own money.' Don't know how long that's been the case but more than my lifetime, but less than 236 years.
The only way to break the cycle is a smarter electorate majority (long odds) or an even more obvious financial collapse (hate to think what it would take to be more 'obvious.'
Again, this thread illustrates how far away we still are, and this is an above average group...
__________________
No one agrees with other people's opinions; they merely agree with their own opinions -- expressed by somebody else. Sydney Tremayne
Retired Jun 2011 at age 57
Target AA: 50% equity funds / 45% bonds / 5% cash
Target WR: Approx 1.5% Approx 20% SI (secure income, SS only)
|
|
|
09-13-2012, 01:14 PM
|
#69
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Apr 2003
Location: Hooverville
Posts: 22,983
|
Quote:
Originally Posted by Midpack
Don't know who originated it, but 'politics is the art of bribing people with their own money.'
|
I would say that it is the art of bribing people with someone else's money. My money has so far been way to heavy on the bribe funding side. I will never live long enough to get my bribe money back, no matter how downtrodden I may become.
The big change in USA is that recently the majority have become bribe takers, not bribe funders.
Ha
__________________
"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
|
|
|
|
|
Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
|
|
Posting Rules
|
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts
HTML code is Off
|
|
|
|
» Recent Threads
|
|
|
|
|
|
|
|
|
|
|
|
|
» Quick Links
|
|
|