US could run out of cash as soon as Dec. 15, Janet Yellen warns - page 2.

Gyfts

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Quote from: Sithara007 on December 04, 2021, 10:37:21 PM

Quote from: dzonikg28 on December 02, 2021, 07:57:33 AM

~~~
https://www.bloomberg.com/news/articles/2021-11-15/global-wealth-surges-as-china-overtakes-u-s-to-grab-top-spot

China's net worth grew from $7 trillion to $120 trillion between 2000 and 2020 whereas the US doubled their net worth to $90 trillion over the same period of time.

Not surprised. US penalizes wealth creators by imposing more and more taxes (now there is an insane proposals to tax capital gains up to 60%), and encourages those who are unproductive. China on the other hand prioritizes wealth creation and clamps down on social parasites and welfare rats. The results are out there for everyone to see. Wealth creators are moving out of the US, and opening their factories elsewhere. Obamacare and rising minimum wages have made opening businesses and factories in the US unsustainable.

The US can't keep up their taxes on the wealthy with their spending habits, despite the harsh rhetoric of wealth taxes or ensuring the rich pay their fair share. Most of it is political pandering, as are many other things related to demonizing the rich, but on a deeper level politicians are aware that if they keep driving up the effective tax rate, it'll slow down growth. The strategy for the US, I'm assuming, has been growing the economy in order to raise enough revenue to pay off the debt. Their reckless spending has not slowed down, and Covid has slowed the economy, so all this has thrown a wrench in their plans. Expect a wealth tax to be passed sooner rather than later.

omone1

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They always have a way of lobbying the opposition members to reach a compromise and get the economy running. If the US runs out of cash,many sectors will suffer, even stock market could crash heavily and many nations dependent on US aid would be distressed. The US really need to enforce some financial discipline and stop reckless printing of money that always cause inflation.

DrBeer

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Quote from: dzonikg28 on December 02, 2021, 07:57:33 AM

Quote from: DrBeer on December 01, 2021, 02:08:05 PM

Understand one simple thing - the USA produces the most demanded product in the world - the DOLLAR! Everyone needs it, because he can do anything. Whether someone likes it or not ... And given that the "blood" of the world economy is the same dollar, the printed extra billions of dollars will not create any noticeable negative for either the US economy or the world economy. The world market will eat all the pieces of paper that the United States will give him. In the end, when the printed money returns to the banking system, everything that the USA needs will be bought with it - they will saturate its market with what it needs, the "extra paper" will dissolve in the accounts and wallets of manufacturers around the world.

This makes quite a lot of sense and honestly, how often has it now been said that the US is going to be broke in a couple of weeks from now? Countless times by now?

What you just outlined here is the truth and actually the one thing that does indeed safe the US. I am wondering though whether the US dollar will stay on top for very long as there is reason to believe that this could change in the future.

https://www.bloomberg.com/news/articles/2021-11-15/global-wealth-surges-as-china-overtakes-u-s-to-grab-top-spot

China's net worth grew from $7 trillion to $120 trillion between 2000 and 2020 whereas the US doubled their net worth to $90 trillion over the same period of time.

It is difficult to say what to expect, but if the US itself does not do stupid things and / or an objectively more profitable instrument does not appear than the dollar, and it is not accepted by the world economic majority, the dollar has no problems on the horizon. China is perhaps the biggest bubble in human history. And soon enough you will see the Chinese economy rushing downward, picking up speed and demolishing everything in its path. This will destroy the Chinese economy, and affect the world economy, but the world economy is larger and more stable than the Chinese one, ABSOLUTELY dependent on the market of buyers from the same EU and the USA.

Quote from: savetheFORUM on December 03, 2021, 07:20:33 AM

Quote from: DrBeer on December 01, 2021, 02:08:05 PM

Understand one simple thing - the USA produces the most demanded product in the world - the DOLLAR! Everyone needs it, because he can do anything. Whether someone likes it or not ... And given that the "blood" of the world economy is the same dollar, the printed extra billions of dollars will not create any noticeable negative for either the US economy or the world economy. The world market will eat all the pieces of paper that the United States will give him. In the end, when the printed money returns to the banking system, everything that the USA needs will be bought with it - they will saturate its market with what it needs, the "extra paper" will dissolve in the accounts and wallets of manufacturers around the world.

Okay, that must be great points. The U.S. dollar being in power gives it a lot of advantages. Maybe all these things that people are saying that there will be a problem and this and that, maybe it’s not going to happen, but don’t you think that they still have to be careful and try to apply measures that are going to help make things better? Because this is just like a wearing of shoes, maybe it wouldn’t have an effect now, but as time goes on as it continues to pile up, the time might come when it will finally have an effect, and the effect they might not be able to handle it.

So, if they really want to avoid such a problem, maybe now would be a good time to start applying measures that are going to help them to avoid all these problems in the future. I do know that for many years now that a lot of people keep saying things like this but it never happens come but they (government) still have to be careful and mind the kind of actions they are taking.

Absolutely agree ! No matter how stable the dollar and the US economy are, an overestimation of its capabilities always leads to very unpleasant consequences. But now I do not see any signs of such "stupid actions" that can really lead to a catastrophe of the US economy and the dollar as a whole. There is still one side of the problem - even if the dollar is "bad", the question is - who will replace it? euro? yuan? pound? The world economy will not be able to operate on multicurrency settlements; they need a unique means of calculation. But none of the above are suitable for this role.

[moderator's note: consecutive posts merged]

Abiky

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Quote from: DrBeer on December 01, 2021, 02:08:05 PM

Understand one simple thing - the USA produces the most demanded product in the world - the DOLLAR! Everyone needs it, because he can do anything. Whether someone likes it or not ... And given that the "blood" of the world economy is the same dollar, the printed extra billions of dollars will not create any noticeable negative for either the US economy or the world economy. The world market will eat all the pieces of paper that the United States will give him. In the end, when the printed money returns to the banking system, everything that the USA needs will be bought with it - they will saturate its market with what it needs, the "extra paper" will dissolve in the accounts and wallets of manufacturers around the world.

That's the point. The US is still the leading economy of the world, even with the negative effects of the COVID-19 pandemic. Since the US Dollar is the reserve currency of the world, the government can easily manipulate the mainstream economy in its favor. "Running out of cash" is simply an excuse to print more money in the long haul. This will only create a higher inflation rate, effectively devaluing the US Dollar. Of course, this won't remove the US Dollar's dominance on the world economy. But it will have a negative effect over people's pockets as costs become too high to bear. Luckily, this will "pump" scarce assets like Bitcoin and Gold all the way to the moon. Holders of these assets will obtain greater purchasing power as inflation grows like crazy. The US government claims the current situation is temporary so there's hope everything will go back to normal after the end of the COVID-19 pandemic. Just my thoughts Grin

Hydrogen

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The december 15th, 2021 deadline is looming large on the horizon.

My memory of past debt ceiling raises and the implications of it not being raised are vague.

Some sources claim that failure to raise the debt ceiling would result in a default. Other sources have said that essential operations and funding of programs like social security, unemployment and food stamps would continue to run normally while other less critical aspects of government would be shut down.

If the debt ceiling is not raised before the deadline, I guess we will all find out together what the real world implications are.

Vaguely, I seem to remember the debt ceiling not being raised and government shutting down under Obama. Without anything serious happening, most may not even have realized it occurred. But I could be remembering incorrectly on that.

wxa7115

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Quote from: so98nn on December 05, 2021, 08:39:20 AM

It amuses me how perfectly developed country like U.S. can get into trap like this? I mean developing countries are way better than U.S. in managing their economy and reduce the inflation at faster rates. For example, many asian countries are on the list who has so much population, so much infra to develop and survive on both farmers and huge IT and pharma sectors. They have giant infra to develop for their country, they have huge problems being democratic countries, no presidential rule, yet contributing to biggest economic bulge to the globe. I am pretty sure U.S. is like a country who overspends the budgets all the time on unnecessary stuff. They have so much industrialisation and perfect taxation system then also they run out of the funds. It's way funny to think. I am not sure if this is true but I have read somewhere that they overspend the money military and keep doing so in trillions of dollars. Is it really necessary to do so?

They got complacent, the dollar has been the reserve currency of the world for so long that they think they can keep abusing of their privilege forever, this is why they can get away with financial and economic policies that will simply bankrupt any other country, but this is not going to last forever.

Competing countries are tired of this advantage the dollar gives to the US and they are looking for ways to reduce the amount of dollars they keep in reserve and that they accept as payment, and if enough countries begin to do this then the rate of inflation of the dollar on its home country will increase dramatically as those dollars will have nowhere to go but back to the US.

tyz

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Quote from: Lotus on November 17, 2021, 10:17:48 PM

The US can't practically run out of cash as long as the world reserve currency is the USD. They can print money to pay their debts even to foreign countries. Of course that's a single use get-out-of-jail card. Because once they do that, the USD will cease to be the reserve currency.

Possibly at that point some "other" currency that is not controlled by any single government... perhaps something decentralized.

The question is what would be the alternative to the reserve currency US dollar for export-strong countries?

There is none. It would damage confidence massively, but in principle not much would change. There would be only two options as a reserve currency, that would be the Euro and the Yuan. But both have their weaknesses, and other currencies like the Yen or the Swiss Franc are too small to serve as a world reserve currency.

so98nn

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It amuses me how perfectly developed country like U.S. can get into trap like this? I mean developing countries are way better than U.S. in managing their economy and reduce the inflation at faster rates. For example, many asian countries are on the list who has so much population, so much infra to develop and survive on both farmers and huge IT and pharma sectors. They have giant infra to develop for their country, they have huge problems being democratic countries, no presidential rule, yet contributing to biggest economic bulge to the globe. I am pretty sure U.S. is like a country who overspends the budgets all the time on unnecessary stuff. They have so much industrialisation and perfect taxation system then also they run out of the funds. It's way funny to think. I am not sure if this is true but I have read somewhere that they overspend the money military and keep doing so in trillions of dollars. Is it really necessary to do so?

Sithara007

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Quote from: dzonikg28 on December 02, 2021, 07:57:33 AM

~~~
https://www.bloomberg.com/news/articles/2021-11-15/global-wealth-surges-as-china-overtakes-u-s-to-grab-top-spot

China's net worth grew from $7 trillion to $120 trillion between 2000 and 2020 whereas the US doubled their net worth to $90 trillion over the same period of time.

Not surprised. US penalizes wealth creators by imposing more and more taxes (now there is an insane proposals to tax capital gains up to 60%), and encourages those who are unproductive. China on the other hand prioritizes wealth creation and clamps down on social parasites and welfare rats. The results are out there for everyone to see. Wealth creators are moving out of the US, and opening their factories elsewhere. Obamacare and rising minimum wages have made opening businesses and factories in the US unsustainable.

wxa7115

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Quote from: savetheFORUM on December 03, 2021, 07:20:33 AM

Quote from: DrBeer on December 01, 2021, 02:08:05 PM

Understand one simple thing - the USA produces the most demanded product in the world - the DOLLAR! Everyone needs it, because he can do anything. Whether someone likes it or not ... And given that the "blood" of the world economy is the same dollar, the printed extra billions of dollars will not create any noticeable negative for either the US economy or the world economy. The world market will eat all the pieces of paper that the United States will give him. In the end, when the printed money returns to the banking system, everything that the USA needs will be bought with it - they will saturate its market with what it needs, the "extra paper" will dissolve in the accounts and wallets of manufacturers around the world.

Okay, that must be great points. The U.S. dollar being in power gives it a lot of advantages. Maybe all these things that people are saying that there will be a problem and this and that, maybe it’s not going to happen, but don’t you think that they still have to be careful and try to apply measures that are going to help make things better? Because this is just like a wearing of shoes, maybe it wouldn’t have an effect now, but as time goes on as it continues to pile up, the time might come when it will finally have an effect, and the effect they might not be able to handle it.

So, if they really want to avoid such a problem, maybe now would be a good time to start applying measures that are going to help them to avoid all these problems in the future. I do know that for many years now that a lot of people keep saying things like this but it never happens come but they (government) still have to be careful and mind the kind of actions they are taking.

And that is the main issue, there was a time the British pound was the reserve currency of the world but then it got replaced by the dollar, so while the US is taking full advantage of this it may come the day in which the US dollar will be replaced by another currency.

And while this is inevitable, at the same time the way they are manipulating their currency supply and causing high inflation all over the world means that competing countries have more and more reasons to begin to look for alternatives to the current system, accelerating the collapse of the dollar in the process.

savetheFORUM

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Quote from: DrBeer on December 01, 2021, 02:08:05 PM

Understand one simple thing - the USA produces the most demanded product in the world - the DOLLAR! Everyone needs it, because he can do anything. Whether someone likes it or not ... And given that the "blood" of the world economy is the same dollar, the printed extra billions of dollars will not create any noticeable negative for either the US economy or the world economy. The world market will eat all the pieces of paper that the United States will give him. In the end, when the printed money returns to the banking system, everything that the USA needs will be bought with it - they will saturate its market with what it needs, the "extra paper" will dissolve in the accounts and wallets of manufacturers around the world.

Okay, that must be great points. The U.S. dollar being in power gives it a lot of advantages. Maybe all these things that people are saying that there will be a problem and this and that, maybe it’s not going to happen, but don’t you think that they still have to be careful and try to apply measures that are going to help make things better? Because this is just like a wearing of shoes, maybe it wouldn’t have an effect now, but as time goes on as it continues to pile up, the time might come when it will finally have an effect, and the effect they might not be able to handle it.

So, if they really want to avoid such a problem, maybe now would be a good time to start applying measures that are going to help them to avoid all these problems in the future. I do know that for many years now that a lot of people keep saying things like this but it never happens come but they (government) still have to be careful and mind the kind of actions they are taking.

dzonikg28

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Quote from: DrBeer on December 01, 2021, 02:08:05 PM

Understand one simple thing - the USA produces the most demanded product in the world - the DOLLAR! Everyone needs it, because he can do anything. Whether someone likes it or not ... And given that the "blood" of the world economy is the same dollar, the printed extra billions of dollars will not create any noticeable negative for either the US economy or the world economy. The world market will eat all the pieces of paper that the United States will give him. In the end, when the printed money returns to the banking system, everything that the USA needs will be bought with it - they will saturate its market with what it needs, the "extra paper" will dissolve in the accounts and wallets of manufacturers around the world.

This makes quite a lot of sense and honestly, how often has it now been said that the US is going to be broke in a couple of weeks from now? Countless times by now?

What you just outlined here is the truth and actually the one thing that does indeed safe the US. I am wondering though whether the US dollar will stay on top for very long as there is reason to believe that this could change in the future.

https://www.bloomberg.com/news/articles/2021-11-15/global-wealth-surges-as-china-overtakes-u-s-to-grab-top-spot

China's net worth grew from $7 trillion to $120 trillion between 2000 and 2020 whereas the US doubled their net worth to $90 trillion over the same period of time.

DrBeer

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Understand one simple thing - the USA produces the most demanded product in the world - the DOLLAR! Everyone needs it, because he can do anything. Whether someone likes it or not ... And given that the "blood" of the world economy is the same dollar, the printed extra billions of dollars will not create any noticeable negative for either the US economy or the world economy. The world market will eat all the pieces of paper that the United States will give him. In the end, when the printed money returns to the banking system, everything that the USA needs will be bought with it - they will saturate its market with what it needs, the "extra paper" will dissolve in the accounts and wallets of manufacturers around the world.

Abiky

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Quote from: wxa7115 on November 29, 2021, 05:04:15 PM

It is true the US cannot really default on its debts as they can pay with newly printed dollars if they want, however how long can they keep this? Even before the pandemic countries like China and Russia were looking to trade using their own currencies and were avoiding the dollar.

If this continues then more countries will begin to do the same and the hegemony of the dollar could collapse, and if it does the world economy will be in huge problems, this will help bitcoin but at the same time this will probably harden the posture of many governments and they will begin to go against anyone that was cautious enough to put their wealth in a store of value like bitcoin.

I don't think there's reason to panic, especially when the US Dollar enjoys its status as the reserve currency of the world. The United States of America can simply manipulate the economy to its own benefit. Inflation has always been there, but now the situation is worse with the pandemic affecting the global economy. Constant government spending will only increase the debt, greatly affect the value of the US Dollar. Long-term speaking, the US Dollar will fail. But in the short-term, it's highly unlikely that'll happen due to reasons mentioned before. As long as we have Bitcoin, nothing else matters Cheesy

Sithara007

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Quote from: wxa7115 on November 29, 2021, 05:04:15 PM

It is true the US cannot really default on its debts as they can pay with newly printed dollars if they want, however how long can they keep this? Even before the pandemic countries like China and Russia were looking to trade using their own currencies and were avoiding the dollar.

If this continues then more countries will begin to do the same and the hegemony of the dollar could collapse, and if it does the world economy will be in huge problems, this will help bitcoin but at the same time this will probably harden the posture of many governments and they will begin to go against anyone that was cautious enough to put their wealth in a store of value like bitcoin.

As long as USD is the reserve currency of the world, they can go on doing this. And although there have been attempts to use currencies such as Euro and CNY for the global trade, they were met with limited success. It is foolish to assume anyone outside China would be willing to use the CNY, which is perhaps the most manipulated currency in the world. US Dollar is not the best currency, but right now it is more reliable and trustworthy when compared to the other fiats out there such as the CNY, RUR and GBP.

wxa7115

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Quote from: davis196 on November 24, 2021, 06:53:46 AM

The US is not in trouble.The US politicians are again creating some drama that nobody needs.
The US debt ceiling debate has become a normal thing,which happens in the end of every year,since the Obama administration,if I remember this correctly.
Both parties will settle some kind of agreement and the debt ceiling will be raised again.I assume that before that agreement,there will be some accusations between both democrats and republicans,so the drama seeking mainstream media can be happy,but there will be a compromise in the end.
The USA cannot go default because they have a money printing machine and US dollar is the global currency.

It is true the US cannot really default on its debts as they can pay with newly printed dollars if they want, however how long can they keep this? Even before the pandemic countries like China and Russia were looking to trade using their own currencies and were avoiding the dollar.

If this continues then more countries will begin to do the same and the hegemony of the dollar could collapse, and if it does the world economy will be in huge problems, this will help bitcoin but at the same time this will probably harden the posture of many governments and they will begin to go against anyone that was cautious enough to put their wealth in a store of value like bitcoin.

worldofcoins

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Well if we look into the past there were the same Rumours many times but every time there was some way out for all those scenarios.
Unlike in the past, everything will be settled as there wasn't any such situation occurred ever (i.e: entering into new agreements or by some other legislation processes) but please note down that there aren't going to be run out of cash.

dezoel

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Not like USA has ever hit the ceiling, not like they never stopped the government before, not like both Obama and Trump failed to pay government workers for a long period of time just because they couldn't come to an agreement, this would be unique and for the first time right??

Come on guys, Janet is basically trolling right now with how she is acting all innocent and worried and so forth and all she is trying to say is that something bad is about to happen and there is nothing we could stop it, it is bad but we are going to do it anyway because we have to. They will maybe even shut the government down for a while just like how they did it before and then they are going to increase their debt by 10+ more trillion dollars in just 5 years or maybe even quicker and act shocked when the next president needs to increase the ceiling all over again.

justdimin

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Quote from: davis196 on November 24, 2021, 06:53:46 AM

The US is not in trouble.The US politicians are again creating some drama that nobody needs.
The US debt ceiling debate has become a normal thing,which happens in the end of every year,since the Obama administration,if I remember this correctly.
Both parties will settle some kind of agreement and the debt ceiling will be raised again.I assume that before that agreement,there will be some accusations between both democrats and republicans,so the drama seeking mainstream media can be happy,but there will be a compromise in the end.
The USA cannot go default because they have a money printing machine and US dollar is the global currency.

This has been the case for as long as I can remember. Creating a situation, a crisis and then asking for your voters to look at it so they would care about it and vote for your party is the key to success over at USA. Platon said (2000 years ago!!!!) "democracy is an education work, without education democracy would turn to oligarchy and if you continue then you will have demagogues and from demagogues you get dictators".

This is something that is still valid today and USA is not a very well educated nation, try to explain to any other nation why they should not have free healthcare with their taxes, try to explain to them why all their taxes should go to military getting new ships with airplanes on it, none of them would vote for you because those people are educated. However in USA saying things like "you can't afford free healthcare, we need to buy more guns!!!" gets you votes. Janet Yellen basically uses the same tactic to divert attention something else.

Abiky

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Quote from: sikke on November 19, 2021, 05:53:00 PM

Hasn't this happened already in the past multiple times?

The fiat system is irretrievably broken and this is just one of the symptoms. It's not the root cause of its issues like Yellen makes it seem.

The more the debt ceiling gets lifted, the more money is going to come into circulation and therefore inflation will pick up. Our only chance is holding cryptos as a hedge.

Inflation has always been there. But now it's more noticeable due to the negative effects of the pandemic on the global economy. It's up to you to secure your capital by investing into scarce assets like Bitcoin and Gold. Only then, you'll avoid losing purchasing power in the long run. The US Dollar is already losing traction so it should only be a matter of time before another currency replaces it as the world's reserve currency. I'd imagine inflation having a positive effect over Bitcoin's price in the long term. Who knows if prices go higher after Dec 15? Just my thoughts Grin

Topic: US could run out of cash as soon as Dec. 15, Janet Yellen warns - page 2. (Read 601 times)