How much in debt are you.

[Toddsterpatriot]

To hell with your kid. What if you gave some adult a 1 trillion IOU. And you not only had the money to pay him, but you were legally obliged to do so. Would you then be worried about your unfunded liability?

What's my family net worth with these IOUs floating around?

 

[The Duke]

What's my family net worth with these IOUs floating around?

 

[Dekster]

Where did you ever learn that garbage. Arab countries don't need anything to create a predictable inflow of American dollars. Or to buy American goods. They already have such a thing. It is called oil. And with the money they get from that, they can simply buy out other countries. The band Genesis did an album with a title of how that happens. It is called, "Selling England By The Pound."

It is why oil is traded in dollars. Japan holds over a trillion in US debt because they are completely dependent on importing almost everything and need to be able to pay for it. China owns $800B in treasuries because it was the only way to stabilize their currency acceptable to the financial markets, and it creates a valuation differential they use to make their exports to the US relatively cheaper and harder to compete with by US companies.

 

[g5000]

No, it means we have exchanged some of our wealth for something they have to offer. No different than when you go to the grocery store or pay someone to mow your grass.

In the example I gave in post 61, I have a $90 trade deficit with my neighbor, but I have a couch to show for it.

The point was that I don't owe my neighbor any money.

 

[Mexicano]

I was talking to my brother today. Who is a real Trumptard. We were talking about the national debt. He seemed to think that Trump could fix it. But we owe so much, it is impossible. Our trade deficit is around 34 trillion dollars. But the U.S. also has around another 200 trillion in unfunded obligations. To me, I don't see much difference between a debt and an obligation. So you may as well say that the U.S. is around 234 trillion in debt. There are around 335 million people in the U.S. That means that each person in the U.S. is in debt for around $698,000! Another problem with that is that there are only around 128 million working age adults in the U.S. Which would make paying off such an impossible figure even more impossible.

Also, there are varying estimates as to what our yearly trade imbalance is with China alone. I have seen estimates that ranged from 257 billion to about 420 billion. So each year we go even deeper into debt by that much just from "trade" with China. Which of course makes paying off such an impossible debt even more unlikely.

As you can guess from what I said earlier, I am definitely not a Trump supporter. But Biden's solution to this problem seems to be to let as many lowlife invaders from south of the border into the U.S. as he can. Maybe what we need is an amoral, psychopathic, would be dictator with delusions of grandeur as president. It seems to me that we couldn't do much worse.

The economy consists of a set of interleaved balance sheets. Government's deficit is the financial equity of the other sectors ( banks, firms , households, and foreign sector).
The deficit itself is irrelevant, it is relevant as a percent of gdp. When that ratio increases usually means poor spending in productive areas ( we can exclude war periods of such judgment).
The US government has not been spending wisely since 2008.

The public debt is not meant to be paid, there is no need to as long as the USD remains the main reserve currency. That said it would be wise to control its growth to avoid budget constraints in the future, when the USD is no longer the main reserve currency.

 

[brainsee]

It is why oil is traded in dollars. Japan holds over a trillion in US debt because they are completely dependent on importing almost everything and need to be able to pay for it. China owns $800B in treasuries because it was the only way to stabilize their currency acceptable to the financial markets, and it creates a valuation differential they use to make their exports to the US relatively cheaper and harder to compete with by US companies.

Who cares what oil is traded in. It is the oil that has the value. Not the currency. Next, apparently there is nothing but bullshit to be found on the internet on the matter. They say that Japan owns 1.1 trillion of the U.S.'s ass. That might be believable. But as far as I looked, it said that China owns 786 billion of the U.S.'s ass. I find that impossible to believe. Every single year our trade imbalance with China ranges anywhere from 257 billion to 419 billion. That is minus the value of what they import from us. That has been going on for at least the last 20 years. That debt doesn't go anywhere. It just adds up.

Let's take the best case scenario and say that every year our trade imbalance with China has only been 257 billion per year. Which means 257 billion deeper in debt to them. In the past 20 years (at least) our debt to China must be around 5.14 trillion. On another note, there is talk now and then about possible conflict with China. They could put us in a hurt by just demanding payment for what we owe them. Our likely response to that would simply to add another 5.14 trillion to our national debt. But with the U.S. already being so far in debt, our currency is already basically worthless anyway. So what could it hurt.

Next, you are wrong about what makes Chinese exports to the U.S. cheaper. It isn't what they "do to stabilize their currency." It is the fact that on average, American workers make around $29.32 per hour. Though it was difficult to find, I found out that the average hourly wage of a Chinese worker is $3.60 per hour. Basically, Chinese workers are our wage slaves. That is impossible for an American worker to compete with. But those who sell Chinese products in the U.S. are probably shitting gold. But you would probably say that taxing the rich is bad.

 

[brainsee]

The economy consists of a set of interleaved balance sheets. Government's deficit is the financial equity of the other sectors ( banks, firms , households, and foreign sector).
The deficit itself is irrelevant, it is relevant as a percent of gdp. When that ratio increases usually means poor spending in productive areas ( we can exclude war periods of such judgment).
The US government has not been spending wisely since 2008.

The public debt is not meant to be paid, there is no need to as long as the USD remains the main reserve currency. That said it would be wise to control its growth to avoid budget constraints in the future, when the USD is no longer the main reserve currency.

No offence, but what you said sounds like a bunch of BS. Next, debt is meant to be paid. That is why they call it debt. Also, when it comes to finance, you might find reply #86 to be of interest.

 

[Dekster]

No offence, but what you said sounds like a bunch of BS. Next, debt is meant to be paid. That is why they call it debt. Also, when it comes to finance, you might find reply #86 to be of interest.

China holds US treasuries to reassure the financial sector that the yuan's value isn't as arbitrarily set by China as it was before. There can be more than one reason to invest in US bonds.

 

[Mexicano]

No offence, but what you said sounds like a bunch of BS. Next, debt is meant to be paid. That is why they call it debt. Also, when it comes to finance, you might find reply #86 to be of interest.

None taken.
Public debt is not meant to be paid.... all fiat money is some form of debt.
Since the government has a steady steam of revenue ( taxes) it is the only sector that can remain in negative equity indefinitely.
Don't take my word on it look at any long-term chart of public debt

 

[Mexicano]

Who cares what oil is traded in. It is the oil that has the value. Not the currency.

It is actually very important, it creates demand for a currency : if you want to buy oil you can't use your own currency , rather you must obtain dollars.

Next, apparently there is nothing but bullshit to be found on the internet on the matter. They say that Japan owns 1.1 trillion of the U.S.'s ass. That might be believable. But as far as I looked, it said that China owns 786 billion of the U.S.'s ass. I find that impossible to believe. Every single year our trade imbalance with China ranges anywhere from 257 billion to 419 billion. That is minus the value of what they import from us. That has been going on for at least the last 20 years. That debt doesn't go anywhere. It just adds up.

Let's take the best case scenario and say that every year our trade imbalance with China has only been 257 billion per year. Which means 257 billion deeper in debt to them. In the past 20 years (at least) our debt to China must be around 5.14 trillion. On another note, there is talk now and then about possible conflict with China. They could put us in a hurt by just demanding payment for what we owe them. Our likely response to that would simply to add another 5.14 trillion to our national debt. But with the U.S. already being so far in debt, our currency is already basically worthless anyway. So what could it hurt.

No , the Fed can actually just credit their foreign account with the appropriate amount of the debt , t-bill buybacks are a common operation. Where do you think the money for the banks bailout came from ? Taxes ?
The USD is valuable as long as it remains the main reserve currency as it will always be required to perform trade exchanges.
Some BRICS countries are already trading in their own currencies, this actually hurts the USD position as a global reserve currency.

Next, you are wrong about what makes Chinese exports to the U.S. cheaper. It isn't what they "do to stabilize their currency." It is the fact that on average, American workers make around $29.32 per hour. Though it was difficult to find, I found out that the average hourly wage of a Chinese worker is $3.60 per hour. Basically, Chinese workers are our wage slaves. That is impossible for an American worker to compete with. But those who sell Chinese products in the U.S. are probably shitting gold. But you would probably say that taxing the rich is bad.

It depends on the currency exchange rate, wages, and the level of automation. China is automating at a neck-breaking speed.
In some industries, like pharma factory wages are a minimal component of the cost (2.5% to 3%) other costs represent a much higher percentage of the cost like r&d ( 20% to 25%) and selling & marketing (25% to 30%) .

 

[Toddsterpatriot]

Who cares what oil is traded in. It is the oil that has the value. Not the currency. Next, apparently there is nothing but bullshit to be found on the internet on the matter. They say that Japan owns 1.1 trillion of the U.S.'s ass. That might be believable. But as far as I looked, it said that China owns 786 billion of the U.S.'s ass. I find that impossible to believe. Every single year our trade imbalance with China ranges anywhere from 257 billion to 419 billion. That is minus the value of what they import from us. That has been going on for at least the last 20 years. That debt doesn't go anywhere. It just adds up.

Let's take the best case scenario and say that every year our trade imbalance with China has only been 257 billion per year. Which means 257 billion deeper in debt to them. In the past 20 years (at least) our debt to China must be around 5.14 trillion. On another note, there is talk now and then about possible conflict with China. They could put us in a hurt by just demanding payment for what we owe them. Our likely response to that would simply to add another 5.14 trillion to our national debt. But with the U.S. already being so far in debt, our currency is already basically worthless anyway. So what could it hurt.

Next, you are wrong about what makes Chinese exports to the U.S. cheaper. It isn't what they "do to stabilize their currency." It is the fact that on average, American workers make around $29.32 per hour. Though it was difficult to find, I found out that the average hourly wage of a Chinese worker is $3.60 per hour. Basically, Chinese workers are our wage slaves. That is impossible for an American worker to compete with. But those who sell Chinese products in the U.S. are probably shitting gold. But you would probably say that taxing the rich is bad.

Let's take the best case scenario and say that every year our trade imbalance with China has only been 257 billion per year. Which means 257 billion deeper in debt to them. In the past 20 years (at least) our debt to China must be around 5.14 trillion.

They used that money to buy things. Some from us, some from other countries.

 

[Toddsterpatriot]

It is actually very important, it creates demand for a currency : if you want to buy oil you can't use your own currency , rather you must obtain dollars.

No , the Fed can actually just credit their foreign account with the appropriate amount of the debt , t-bill buybacks are a common operation. Where do you think the money for the banks bailout came from ? Taxes ?
The USD is valuable as long as it remains the main reserve currency as it will always be required to perform trade exchanges.
Some BRICS countries are already trading in their own currencies, this actually hurts the USD position as a global reserve currency.


It depends on the currency exchange rate, wages, and the level of automation. China is automating at a neck-breaking speed.
In some industries, like pharma factory wages are a minimal component of the cost (2.5% to 3%) other costs represent a much higher percentage of the cost like r&d ( 20% to 25%) and selling & marketing (25% to 30%) .

Where do you think the money for the banks bailout came from ? Taxes ?

Yes, the TARP bailout was from taxes.

 

[Mexicano]

Where do you think the money for the banks bailout came from ? Taxes ?

Yes, the TARP bailout was from taxes.

In 2008, the central bank simply created the assets it needed and swapped them with the banks. 1.2 trillion. That didn't come from taxes at all. What? Do you think the government cut spending by 1.2 trillion that year?

Assets: Total Assets: Total Assets (Less Eliminations from Consolidation): Wednesday Level

View the total value of the assets of all Federal Reserve Banks as reported in the weekly balance sheet.

fred.stlouisfed.org

 

[Toddsterpatriot]

In 2008, the central bank simply created the assets it needed and swapped them with the banks. 1.2 trillion. That didn't come from taxes at all. What? Do you think the government cut spending by 1.2 trillion that year?

Assets: Total Assets: Total Assets (Less Eliminations from Consolidation): Wednesday Level

View the total value of the assets of all Federal Reserve Banks as reported in the weekly balance sheet.

fred.stlouisfed.org

The Fed wasn't financing TARP.

 

[brainsee]

China holds US treasuries to reassure the financial sector that the yuan's value isn't as arbitrarily set by China as it was before. There can be more than one reason to invest in US bonds.

Sounds like more BS to me. Who cares how China values their money. We would still be buying products from China because there are cheaper than American made goods.

 

[brainsee]

None taken.
Public debt is not meant to be paid.... all fiat money is some form of debt.
Since the government has a steady steam of revenue ( taxes) it is the only sector that can remain in negative equity indefinitely.
Don't take my word on it look at any long-term chart of public debt
View attachment 896901

Maybe this might interest you.


Pgpf
pgpf.org › top-10-reasons-why-the-national-debt-matters

Top 10 Reasons Why the National Debt Matters

 

[brainsee]

It is actually very important, it creates demand for a currency : if you want to buy oil you can't use your own currency , rather you must obtain dollars.

No , the Fed can actually just credit their foreign account with the appropriate amount of the debt , t-bill buybacks are a common operation. Where do you think the money for the banks bailout came from ? Taxes ?
The USD is valuable as long as it remains the main reserve currency as it will always be required to perform trade exchanges.
Some BRICS countries are already trading in their own currencies, this actually hurts the USD position as a global reserve currency.


It depends on the currency exchange rate, wages, and the level of automation. China is automating at a neck-breaking speed.
In some industries, like pharma factory wages are a minimal component of the cost (2.5% to 3%) other costs represent a much higher percentage of the cost like r&d ( 20% to 25%) and selling & marketing (25% to 30%) .

If you want to buy oil, you can use whatever currency your country uses. The rest of what you have to say is equally nonsensical. When it comes to how the financial system works, I have seen experts try to explain it. It is so complex, even they couldn't do it. Now, getting back to the point of my thread, every American owes around $698,000.00. That is combining national debt and unpaid obligations.

 

[brainsee]

Let's take the best case scenario and say that every year our trade imbalance with China has only been 257 billion per year. Which means 257 billion deeper in debt to them. In the past 20 years (at least) our debt to China must be around 5.14 trillion.

They used that money to buy things. Some from us, some from other countries.

Let's say I owe you $50.00. What can you buy with what I owe you. Sure, you might be able to sell my debt to somebody else. But I would still owe the $50.00 dollars.

 

[Toddsterpatriot]

If you want to buy oil, you can use whatever currency your country uses. The rest of what you have to say is equally nonsensical. When it comes to how the financial system works, I have seen experts try to explain it. It is so complex, even they couldn't do it. Now, getting back to the point of my thread, every American owes around $698,000.00. That is combining national debt and unpaid obligations.

Now, getting back to the point of my thread, every American owes around $698,000.00.

Now subtract out my unpaid assets.

 

[Toddsterpatriot]

Let's say I owe you $50.00. What can you buy with what I owe you. Sure, you might be able to sell my debt to somebody else. But I would still owe the $50.00 dollars.

Let's say I gave you $50 for some goods. Why do I give a shit what you do with it?