I thought Republicans were completely, hardcore for reducing the budget, so it's surprising. This conversation is a little too advance for me though.
The one thing that I think should be done is to reduce the amount that people get on food stamps, and welfare, but at the same time educate them on how to better eat, and save money.
Believe me, it makes a huge difference. I know, in trying to save money to invest in Crypto, you learn better ways to eat. Of course people are assholes and will not flow to that which takes a little more effort.
Topic: US deficit (Read 447 times)
If I was made emperor of the US but I was for some reason forced to maintain some level of statism rather than tearing the whole thing down, I think I'd resolve entitlements by:
1. Shut the programs down completely.
2. Calculate a dollar amount that people are "owed" due to "paying into" the programs.
3. The federal government owns 640 million acres of land (28% of the US landmass). Distribute as much of this as possible to the people owed money in entitlements, proportional to how much they're owed.
Example: Say that 600 million acres of the 640 million acres can be disposed of. The social security trust fund has received a total of about $20 trillion over its history. So for every $33k that you personally contributed to the trust fund, you'd get an acre of federal land chosen randomly (which you can sell if you don't like it). Or something in that general vein.
This would IMO be more honest than increasing the social security retirement age to 80 or whatever they'd have to do to get entitlements under control now, it'd put an end to the disastrous programs once and for all, and it'd reduce the government's size / control over assets.
(There's zero chance of them actually doing this, of course.)
1. Shut the programs down completely.
2. Calculate a dollar amount that people are "owed" due to "paying into" the programs.
3. The federal government owns 640 million acres of land (28% of the US landmass). Distribute as much of this as possible to the people owed money in entitlements, proportional to how much they're owed.
Example: Say that 600 million acres of the 640 million acres can be disposed of. The social security trust fund has received a total of about $20 trillion over its history. So for every $33k that you personally contributed to the trust fund, you'd get an acre of federal land chosen randomly (which you can sell if you don't like it). Or something in that general vein.
This would IMO be more honest than increasing the social security retirement age to 80 or whatever they'd have to do to get entitlements under control now, it'd put an end to the disastrous programs once and for all, and it'd reduce the government's size / control over assets.
(There's zero chance of them actually doing this, of course.)
I like this idea, but I think it would be most harmful to those who have paid the most into these entitlement programs. For example, those closest to their end of life would likely be forced to immediately sell this property to live on the proceeds. This would cause them to be preyed upon by real estate moguls that would likely scoop up all of this property at pennies on the dollar. While I like the investment opportunities it would provide, I don't think it is the best way to combat the situation.
If I were made emperor I would try to remove the potential for loss from the people. For example, instead of doling out property, what if they were given tax credits for their contributions that were unable to be recovered? Additions to the program would be halted, and citizens would recover whatever % they are entitled to per their contributions. A tax credit market could be put in place for those who no longer have income so they could be given the choice to sell their credits (I imagine tax credits would hold value better than property in a massive sale), realize them with earnings from employment/investments, or pass them to their heirs should they become deceased. Considering corporations would likely be the biggest buyers of these credits, a looming temporary increase in corporate taxes might even make the credits more valuable than their face as corporations could defer lower taxed income by buying the credits and then redeeming them the following year at the higher tax rate, further helping those in the end of life scenario. I think this might also spur some retirees with the ability to work to rejoin the work force for tax free earnings, or receive more caring support from their families if they are near end of life as a way to inherit a larger tax credit. As an added bonus, the issuing of massive amounts of tax credits would put further strain on the country's budget, spurring more responsible spending policies, which would have benefits once the tax credits have worked their way through the system and been realized.
The idiot Republicans in the US congress just massively increased spending. Over the next few years, the yearly deficit will probably double from $600 billion to $1.2 trillion as a result. I have very little faith in congress, and there's a long history of the Republicans and Democrats working together to recklessly increase both military and domestic spending, but even I was surprised by just how ridiculous this spending increase was.
Previously most people would say that although they didn't want to balance the budget this year, in the future it could be balanced. Republicans would sometimes lay out plans to balance the budget in 15 years or some such nonsense. But people will soon be realizing that this is never going to happen now. In a few years just the interest on the debt will be 5% of GDP or more, and this will grow exponentially.
I think that this will come to a point of crisis within the next decade. How do you guys see things playing out? Several possibilities come to my mind:
- The US prints money like crazy, probably to the point of hyperinflation.
- The US explicitly defaults on its bonds. This'd basically be armageddon for everything in contact with the fiat financial system (eg. banks, stocks, retirement funds, etc.), worldwide.
- Taxes are massively increased. Income tax increases probably wouldn't be sufficient; they'd probably need a national VAT of 15-25% to even begin to bring the budget in order. But there are serious political and legal impediments to such a thing.
- I really can't see them cutting spending in any significant way, but maybe it'd be possible if tons of politicians were replaced and/or the crisis grew large enough.
What I'd recommend they do is default on the bonds and just live with the few years of massive fallout, while simultaneously cutting spending massively. But there's very little chance of that. The hyperinflation route seems most likely to me.
(In any case, it's probably good for crypto...)
Previously most people would say that although they didn't want to balance the budget this year, in the future it could be balanced. Republicans would sometimes lay out plans to balance the budget in 15 years or some such nonsense. But people will soon be realizing that this is never going to happen now. In a few years just the interest on the debt will be 5% of GDP or more, and this will grow exponentially.
I think that this will come to a point of crisis within the next decade. How do you guys see things playing out? Several possibilities come to my mind:
- The US prints money like crazy, probably to the point of hyperinflation.
- The US explicitly defaults on its bonds. This'd basically be armageddon for everything in contact with the fiat financial system (eg. banks, stocks, retirement funds, etc.), worldwide.
- Taxes are massively increased. Income tax increases probably wouldn't be sufficient; they'd probably need a national VAT of 15-25% to even begin to bring the budget in order. But there are serious political and legal impediments to such a thing.
- I really can't see them cutting spending in any significant way, but maybe it'd be possible if tons of politicians were replaced and/or the crisis grew large enough.
What I'd recommend they do is default on the bonds and just live with the few years of massive fallout, while simultaneously cutting spending massively. But there's very little chance of that. The hyperinflation route seems most likely to me.
(In any case, it's probably good for crypto...)
I agree completely that the current system is unsustainable and our debt and deficits will continue to grow to levels well beyond anything that could be considered prudent in any way. Both Republicans and Democrats are to blame for the situation, they both want their pet funding priorities to be made, and especially this nonsense about "dollar for dollar, military spending has to be matched with non-military spending". What? What if there's no need to spend in one or the other area? It's just madness.
I believe the US will print until no one will take our paper anymore. Hyperinflation will occur though it will be masked for a while due to the way the official statistics are calculated through extremely creative accounting.
But I think the inevitable end is a default. They will kick the can as long as they can to avoid it, but at some point there will be no one to buy Treasury bonds (besides the Fed backstop but the bank shareholders of the reserve banks will not allow that to go on endlessly). At that point, when no one will take our worthless paper, we will default.
And, sadly, I believe at that time, we will go to war. History is rife with examples of war being the "collection agent of last resort", and some of our largest creditors have some pretty sophisticated militaries. Of course, none of them spend anywhere near the amount of money that we do for "defense", but anyone that has ever looked at the racket that is defense contracting knows it's at least 2/3 slush. Projects purposefully run over budget, over time, because the contractors know that once the government is in XXX billion, they're going to approve an extension, an increase. Insufficient competition in the defense industry means that a few giants can charge pretty much whatever they want.
Incidentally, it's been very interesting to see SpaceX come about and give Boeing and Lockheed a run for their money. I believe I saw that they can operate their launches at about 30% of the price of Boeing/Lockheed, plus their engines are made in the USA, unlike the largest lift on the Delta rockets which I believe are Russian made.
Cryptocurrency is a great alternative to U.S. dollars, and it will increase in its utility the coming years as fiat currencies are exposed, country by country, as the shams that they are. I am of the opinion that the end-game of the U.S. dollar is essentially decided by those that pull the strings, the question is, how long will the rest of the world buy our shitcoin aka US Treasury bonds? I think some in government see the control that banks have had over not just us, but also the government itself, and want to break free of those tethers (pardon the pun). I think crypto assets can establish a parallel economy that eventually, just possibly, the government itself will switch over to.
President Andrew Jackson had the right idea in opposing private central banks. Even in a pre-crypto era, the concept of a private bank having control over the monetary policy of a country makes no sense to me. The only way it makes sense is from the perspective of the bank. I can see why they'd be all for the idea of putting a nation deep into debt. Perhaps a government-run bank makes sense, but a private bank that has the power to set interbank lending rates and rulemaking authority? Those banksters back in ~1910 that penned the Federal Reserve Act really pulled off a coup! I bet they thought it'd never be passed into law, or maybe with substantial watering down it might have. Boy they sure made out on that.
Best regards,
Ben
Guys, please keep your shitposts outside this discussion. Plus, at this point, it doesn't even matter where the money is spent (nasa, military, education, health, or body painting), because no matter what you try you will never be able to pay so much back. Specially with more and more countries escaping from the petro-dollars.
Not if, but when. In fact, the 2008 crisis was the way out of it. Banks fucked up, they go bankrupt and we put the banksters in jail. A couple of years would have been lost to get back on track. There is the case of Iceland, which did exactly that, and it worked perfectly. Many will say that it was much easier because the scale was much smaller, but it couldn't be more wrong, the scale doesn't matter a bit (except maybe prison size if you've got more banksters). A healthy system will work good for 300,000 peoples, or for 300,000,000.
Instead we chose printing money. Seems so simple, why not ? Now, not only banks are still fucked, but also every governments and central banks that printed money. Quantitative easing, or money printing is nothing else than creating debt on the back of future generations. Like a loan, first you enjoy free money, and then you quickly realize that you must pay every cents back, plus lot's of extra interest. So it is far from free. And the more debt, the more interest you have to pay.
Greece for example, has become enslaved to the ECB this way: If Greece say fuck to the ECB, they go bankrupt, if not, they have to follow ECB conditions which make it even worse. In the end, they will go bankrupt no matter what, but they will now bring every European countries with them (note that they were mostly already fucked anyway, it wouldn't be fair to blame only Greek people for every problems in Europe).
I guess by now people have noticed every new taxes which keep appearing continuously. It is not to pay your retirement pension (don't be silly), but to pay what we printed 10 years ago. And it is just the beginning.
In the end, we will have to pay for for every dollar, yen, euro, GBP, plus interest... that was created out of thin air. And our children. And their children too.
I guess economic crisis in 2008 or 1928 might happen again and government will do something stupid again this time 
Not if, but when. In fact, the 2008 crisis was the way out of it. Banks fucked up, they go bankrupt and we put the banksters in jail. A couple of years would have been lost to get back on track. There is the case of Iceland, which did exactly that, and it worked perfectly. Many will say that it was much easier because the scale was much smaller, but it couldn't be more wrong, the scale doesn't matter a bit (except maybe prison size if you've got more banksters). A healthy system will work good for 300,000 peoples, or for 300,000,000.
Instead we chose printing money. Seems so simple, why not ? Now, not only banks are still fucked, but also every governments and central banks that printed money. Quantitative easing, or money printing is nothing else than creating debt on the back of future generations. Like a loan, first you enjoy free money, and then you quickly realize that you must pay every cents back, plus lot's of extra interest. So it is far from free. And the more debt, the more interest you have to pay.
Greece for example, has become enslaved to the ECB this way: If Greece say fuck to the ECB, they go bankrupt, if not, they have to follow ECB conditions which make it even worse. In the end, they will go bankrupt no matter what, but they will now bring every European countries with them (note that they were mostly already fucked anyway, it wouldn't be fair to blame only Greek people for every problems in Europe).
I guess by now people have noticed every new taxes which keep appearing continuously. It is not to pay your retirement pension (don't be silly), but to pay what we printed 10 years ago. And it is just the beginning.
In the end, we will have to pay for for every dollar, yen, euro, GBP, plus interest... that was created out of thin air. And our children. And their children too.
Quote
The idiot Republicans in the US congress just massively increased spending. Over the next few years, the yearly deficit will probably double from $600 billion to $1.2 trillion as a result. I have very little faith in congress, and there's a long history of the Republicans and Democrats working together to recklessly increase both military and domestic spending, but even I was surprised by just how ridiculous this spending increase was.
Since trillions are being spent on NASA's secret space programs that none wants to talk about.. therefore even if the public deficit would quadruple in the next 12 months, the economy won't feel a thing.
Fuck off with your conspriacytard talk.
If you want to talk about some uber secret space program, start your own thread. This isn't some sci-fi show where they manage to build this ultra secret tech by billing $50k for hammers.
Quote
The idiot Republicans in the US congress just massively increased spending. Over the next few years, the yearly deficit will probably double from $600 billion to $1.2 trillion as a result. I have very little faith in congress, and there's a long history of the Republicans and Democrats working together to recklessly increase both military and domestic spending, but even I was surprised by just how ridiculous this spending increase was.
Since trillions are being spent on NASA's secret space programs that none wants to talk about.. therefore even if the public deficit would quadruple in the next 12 months, the economy won't feel a thing.
I think we're just going to absorb the debt for the most part.
Maybe we'll increase taxes on the ultra wealthy to help reduce the deficient a bit (yeah, right, rofl).
Honestly, running an economy on a debt based system was stupid. The implementation of the federal reserve was pure corruption, and we need to revamp that entire sector.
I foresee a massive crash and I think crypto will switch to be the world's backed currency.
However, the GOP really like starving the beast; https://en.wikipedia.org/wiki/Starve_the_beast
If I was made emperor of the US but I was for some reason forced to maintain some level of statism rather than tearing the whole thing down, I think I'd resolve entitlements by:
1. Shut the programs down completely.
2. Calculate a dollar amount that people are "owed" due to "paying into" the programs.
3. The federal government owns 640 million acres of land (28% of the US landmass). Distribute as much of this as possible to the people owed money in entitlements, proportional to how much they're owed.
Example: Say that 600 million acres of the 640 million acres can be disposed of. The social security trust fund has received a total of about $20 trillion over its history. So for every $33k that you personally contributed to the trust fund, you'd get an acre of federal land chosen randomly (which you can sell if you don't like it). Or something in that general vein.
This would IMO be more honest than increasing the social security retirement age to 80 or whatever they'd have to do to get entitlements under control now, it'd put an end to the disastrous programs once and for all, and it'd reduce the government's size / control over assets.
(There's zero chance of them actually doing this, of course.)
I'm more imagining 90% of banks and other financial institutions collapsing. Deflation seems like a comparatively minor issue. But getting rid of this cancer on the economy would be worth the short-term pain IMO, even from a statist perspective. I think that there'd be pure economic hell for only a year or two, and things would be better than before within a decade, on net.
Trump actually talked about partially defaulting on treasuries (ie. a "haircut") during his campaign, so maybe it's not entirely outside of the mainstream. Some have speculated that he's pushing for all of this spending because he knows that the whole debt & USD system will collapse at some point, so he wants to build up long-lasting capital in domestic infrastructure and military equipment while the ponzi scheme is still running. (I don't really buy this theory personally, though.)
The plans you've laid out are for short term gains, your empire of the USA will fall within the next 30 years. Check into the Roman Empire vs the Roman Republic.
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If I were elected to be leader (with complete authoritarian control), I would double down on the debt, increase taxes. Use the loaned money to upgrade our infrastructure entirely (fiber to home for every house in America), better roads and high speed rail throughout the country. We should be able to move goods from Los Angels to New York within hours on the ground and not in the sky. I'd declare war on aging infrastructure and resolve expensive, long term things federally. As in, no Flint water crisis as the army of corp engineers could go house by house replacing pipes. (Lead lowers IQ, we've seen in this historically, wtf are we doing keeping this shit around? Cause we want a lower IQ area 30 years from now? Fuck off with that expense).
Ideally, this stimulus would push the economy forward, the increased taxes wouldn't be felt by the normal person (as there'd be a lot more work to do). Ideally, we'd build a surplus of cash and use that to fund projects going forward instead of borrowing cash from the federal reserve...
Maybe we'll increase taxes on the ultra wealthy to help reduce the deficient a bit (yeah, right, rofl).
Honestly, running an economy on a debt based system was stupid. The implementation of the federal reserve was pure corruption, and we need to revamp that entire sector.
I foresee a massive crash and I think crypto will switch to be the world's backed currency.
However, the GOP really like starving the beast; https://en.wikipedia.org/wiki/Starve_the_beast
The ultimate problem is entitlement spending, which makes up of over 2/3 of federal outlays verses ~48% 20 years ago. The increase in entitlement spending over the last 20 years is more than enough to account for the entire federal deficit.
If I was made emperor of the US but I was for some reason forced to maintain some level of statism rather than tearing the whole thing down, I think I'd resolve entitlements by:
1. Shut the programs down completely.
2. Calculate a dollar amount that people are "owed" due to "paying into" the programs.
3. The federal government owns 640 million acres of land (28% of the US landmass). Distribute as much of this as possible to the people owed money in entitlements, proportional to how much they're owed.
Example: Say that 600 million acres of the 640 million acres can be disposed of. The social security trust fund has received a total of about $20 trillion over its history. So for every $33k that you personally contributed to the trust fund, you'd get an acre of federal land chosen randomly (which you can sell if you don't like it). Or something in that general vein.
This would IMO be more honest than increasing the social security retirement age to 80 or whatever they'd have to do to get entitlements under control now, it'd put an end to the disastrous programs once and for all, and it'd reduce the government's size / control over assets.
(There's zero chance of them actually doing this, of course.)
Quote
A default on our debt would likely result in massive deflation because so much of the economy relies upon this debt being worth face value (less losses due to interest rate increases), which would result in the economy essentially coming to a halt.
I'm more imagining 90% of banks and other financial institutions collapsing. Deflation seems like a comparatively minor issue. But getting rid of this cancer on the economy would be worth the short-term pain IMO, even from a statist perspective. I think that there'd be pure economic hell for only a year or two, and things would be better than before within a decade, on net.
Trump actually talked about partially defaulting on treasuries (ie. a "haircut") during his campaign, so maybe it's not entirely outside of the mainstream. Some have speculated that he's pushing for all of this spending because he knows that the whole debt & USD system will collapse at some point, so he wants to build up long-lasting capital in domestic infrastructure and military equipment while the ponzi scheme is still running. (I don't really buy this theory personally, though.)
The plans you've laid out are for short term gains, your empire of the USA will fall within the next 30 years. Check into the Roman Empire vs the Roman Republic.
---
If I were elected to be leader (with complete authoritarian control), I would double down on the debt, increase taxes. Use the loaned money to upgrade our infrastructure entirely (fiber to home for every house in America), better roads and high speed rail throughout the country. We should be able to move goods from Los Angels to New York within hours on the ground and not in the sky. I'd declare war on aging infrastructure and resolve expensive, long term things federally. As in, no Flint water crisis as the army of corp engineers could go house by house replacing pipes. (Lead lowers IQ, we've seen in this historically, wtf are we doing keeping this shit around? Cause we want a lower IQ area 30 years from now? Fuck off with that expense).
Ideally, this stimulus would push the economy forward, the increased taxes wouldn't be felt by the normal person (as there'd be a lot more work to do). Ideally, we'd build a surplus of cash and use that to fund projects going forward instead of borrowing cash from the federal reserve...
That is a very interesting subject. And it is also pretty simple if you focus on the big picture.
There is (everywhere in the so called developed countries) a shit lot's of debt. You can pay back, or you can't. And once the debt become too big, no matter what: you can't. From there, there is only two solutions:
1/Bankrupt: you have to face the consequences, and the more debt, the worth it is. I entirely agree with you, it will be Armageddon. But, you can control the fall because you choose the timing. And then, you set everything back to zero, and start building something better with solid foundation, giving some hope back to the next generation.
2/You can try to cheat your way out using stupid tools like QE or very low interest rate. It has NEVER been working in human history. NEVER. So of course, you may win some time, but sooner or later you will get back to option 1 bankrupt, with consequences much bigger than it could have been.
If you want to know what will happen from now on, you can check about 100 years ago back in 1929. Financial world was disconnected from reality, alimented by a flow of money freshly created. The growth of financial markets was hiding what should have been the real inflation rate (Seems familiar, doesn't it ?). Then, the flow stopped. Bankrupt and austerity destroyed lot's of money (deflation), and you know the rest.
Look at the FED recently. Interest rate start increasing, and QE are progressively reduced. It is getting closer.
There is (everywhere in the so called developed countries) a shit lot's of debt. You can pay back, or you can't. And once the debt become too big, no matter what: you can't. From there, there is only two solutions:
1/Bankrupt: you have to face the consequences, and the more debt, the worth it is. I entirely agree with you, it will be Armageddon. But, you can control the fall because you choose the timing. And then, you set everything back to zero, and start building something better with solid foundation, giving some hope back to the next generation.
2/You can try to cheat your way out using stupid tools like QE or very low interest rate. It has NEVER been working in human history. NEVER. So of course, you may win some time, but sooner or later you will get back to option 1 bankrupt, with consequences much bigger than it could have been.
If you want to know what will happen from now on, you can check about 100 years ago back in 1929. Financial world was disconnected from reality, alimented by a flow of money freshly created. The growth of financial markets was hiding what should have been the real inflation rate (Seems familiar, doesn't it ?). Then, the flow stopped. Bankrupt and austerity destroyed lot's of money (deflation), and you know the rest.
Look at the FED recently. Interest rate start increasing, and QE are progressively reduced. It is getting closer.
I think they will create a massive incident somewhere - maybe a war. There is also the situation with DeutscheBank, don't they owe more than the US? and then there is the EU - nobody has mentioned how they are going to repay the UK for their share of the EU assets after Brexit.
War, the US is definitely trying in Korea (and failing) and with Iran. Attacking Iran would be an extremely bad idea though, unless the goal is to lose once more, and pile on the debt and dead soldiers.
Deutsche Bank must not be that worrisome, I listen to a business radio (here in France) and they haven't mentioned it in months.
The UK will be paying, not the other way around.
The ultimate problem is entitlement spending, which makes up of over 2/3 of federal outlays verses ~48% 20 years ago. The increase in entitlement spending over the last 20 years is more than enough to account for the entire federal deficit.
If I was made emperor of the US but I was for some reason forced to maintain some level of statism rather than tearing the whole thing down, I think I'd resolve entitlements by:
1. Shut the programs down completely.
2. Calculate a dollar amount that people are "owed" due to "paying into" the programs.
3. The federal government owns 640 million acres of land (28% of the US landmass). Distribute as much of this as possible to the people owed money in entitlements, proportional to how much they're owed.
Example: Say that 600 million acres of the 640 million acres can be disposed of. The social security trust fund has received a total of about $20 trillion over its history. So for every $33k that you personally contributed to the trust fund, you'd get an acre of federal land chosen randomly (which you can sell if you don't like it). Or something in that general vein.
This would IMO be more honest than increasing the social security retirement age to 80 or whatever they'd have to do to get entitlements under control now, it'd put an end to the disastrous programs once and for all, and it'd reduce the government's size / control over assets.
(There's zero chance of them actually doing this, of course.)
Some of that land is probably very expensive, and most of it probably very cheap, getting it instead of 33K$ would not be a good deal.
Of course inflation is the most likely outcome because it requires the Congress to do what they do best - absolutely nothing.
There is a non-zero chance of Democrats taking control of the Congress this year (or in 2020) and hiking the taxes up but they won't reign in spending. So we might have a twofer - massive inflation AND massive taxes.
There are also some state-level actions possible, although not being able to print their own money and not being able to opt out of federal taxes limits what they can do. But some states might try to challenge military spending or entitlement spending in court if the fiscal situation gets really bad. With the courts (including SC) being stuffed with abject demagogues this could end up in many unexpected ways.
There is a non-zero chance of Democrats taking control of the Congress this year (or in 2020) and hiking the taxes up but they won't reign in spending. So we might have a twofer - massive inflation AND massive taxes.
There are also some state-level actions possible, although not being able to print their own money and not being able to opt out of federal taxes limits what they can do. But some states might try to challenge military spending or entitlement spending in court if the fiscal situation gets really bad. With the courts (including SC) being stuffed with abject demagogues this could end up in many unexpected ways.
As weird as it might seem to some, I do believe that Bitcoin will replace banks quite a lot in our lifetimes.
No. The Blockchain will enhance banks in the coming years, but Bitcoin as a currency will probably not survive, the same way the Model T was outdated by newer inventions.
Back to OP topic, The US will eventually become the United States of China. :/
As weird as it might seem to some, I do believe that Bitcoin will replace banks quite a lot in our lifetimes.
There really isn't that high of risk for robbery when you use Bitcoin, as it is hard to know if the victim really has another paper wallet hidden somewhere.
Lending money still is something banks will do however, but I don't think that such control of the currency that we have today will be left in the hands of governments and banks for too long.
I think that this will end with mainstream adoption of Bitcoin, but that is just my opinion.
There really isn't that high of risk for robbery when you use Bitcoin, as it is hard to know if the victim really has another paper wallet hidden somewhere.
Lending money still is something banks will do however, but I don't think that such control of the currency that we have today will be left in the hands of governments and banks for too long.
I think that this will end with mainstream adoption of Bitcoin, but that is just my opinion.
The idiot Republicans in the US congress just massively increased spending. Over the next few years, the yearly deficit will probably double from $600 billion to $1.2 trillion as a result. I have very little faith in congress, and there's a long history of the Republicans and Democrats working together to recklessly increase both military and domestic spending, but even I was surprised by just how ridiculous this spending increase was.
Previously most people would say that although they didn't want to balance the budget this year, in the future it could be balanced. Republicans would sometimes lay out plans to balance the budget in 15 years or some such nonsense. But people will soon be realizing that this is never going to happen now. In a few years just the interest on the debt will be 5% of GDP or more, and this will grow exponentially.
I think that this will come to a point of crisis within the next decade. How do you guys see things playing out? Several possibilities come to my mind:
- The US prints money like crazy, probably to the point of hyperinflation.
- The US explicitly defaults on its bonds. This'd basically be armageddon for everything in contact with the fiat financial system (eg. banks, stocks, retirement funds, etc.), worldwide.
- Taxes are massively increased. Income tax increases probably wouldn't be sufficient; they'd probably need a national VAT of 15-25% to even begin to bring the budget in order. But there are serious political and legal impediments to such a thing.
- I really can't see them cutting spending in any significant way, but maybe it'd be possible if tons of politicians were replaced and/or the crisis grew large enough.
What I'd recommend they do is default on the bonds and just live with the few years of massive fallout, while simultaneously cutting spending massively. But there's very little chance of that. The hyperinflation route seems most likely to me.
(In any case, it's probably good for crypto...)
Previously most people would say that although they didn't want to balance the budget this year, in the future it could be balanced. Republicans would sometimes lay out plans to balance the budget in 15 years or some such nonsense. But people will soon be realizing that this is never going to happen now. In a few years just the interest on the debt will be 5% of GDP or more, and this will grow exponentially.
I think that this will come to a point of crisis within the next decade. How do you guys see things playing out? Several possibilities come to my mind:
- The US prints money like crazy, probably to the point of hyperinflation.
- The US explicitly defaults on its bonds. This'd basically be armageddon for everything in contact with the fiat financial system (eg. banks, stocks, retirement funds, etc.), worldwide.
- Taxes are massively increased. Income tax increases probably wouldn't be sufficient; they'd probably need a national VAT of 15-25% to even begin to bring the budget in order. But there are serious political and legal impediments to such a thing.
- I really can't see them cutting spending in any significant way, but maybe it'd be possible if tons of politicians were replaced and/or the crisis grew large enough.
What I'd recommend they do is default on the bonds and just live with the few years of massive fallout, while simultaneously cutting spending massively. But there's very little chance of that. The hyperinflation route seems most likely to me.
(In any case, it's probably good for crypto...)
thanks for sharing this post. I agree with you. I like to add some other cases for this content.
1- the costs of Administration of the country will be increased in the recent year, so they most Print more money
2-money printing will cause falling the value of $ so
3- valuable goods like Gold, CryptoCurrencies will increase more
4- They will have to increase the tax heavily.
so what will be happened:
they have to create other BTC for Compensation of this conditions.
I think an optimum solution for social security would be to first significantly raise the retirement age to be more in line with morality rates, and advancements in medicine that allow people to live and work longer. Social security should also be transformed into a 401k type system in which workers (and employers) contribute a mandatory percentage of their earnings into an investment account in which they can invest in a broad range of investments, including both an immediate and deferred annuity sold by private companies. A small amount of what gets deposited into this accounts can be taken and given to the very poor, so most people get 99% of what they put in, and the very poor get much more than 100% of what they put in.
The above is not the best system or the most in line with my personal beliefs, however it does give citizens personal responsibility to invest their retirement savings as they deem best, takes away significant amounts of government control over retirement accounts, while having certain features that makes it unlikely that the program would be entirely undone the next time progressives have supermajorities in congress along with the white house, which will eventually happen.
My concern about giving away government owned land is that a lot of the land is only valuable in very large potions, so a $33k parcel would often have little effective value, and also the value of many parcels would likely change by a lot when certain groups of parcels get developed, while others do not.
Another concern about outright dismantling the social security system is that the next time progressives have super majorities, they can just create a new social security-like system, potentially one that gives government even more control, and creates an even bigger welfare state.
I don't think banks are all that bad though. For deposit holders, they keep money safe from theft, and pay a small amount of interest. Deposit accounts are not very profitable for banks, carry a lot of risk of losses, so they probably would not offer deposit accounts if they are unable to lend some of their deposits out. If everyone had to keep all their money in physical dollars in their house (or other property), there would probably be a lot more violent crimes, including robberies because it would be known that everyone has large amounts of cash in their homes. The deposit services that banks offer also make traveling less risky because without deposit services you would need to carry sufficient cash to cover all expenses of your trip when traveling and getting robbed on the highway would leave your stranded.
Banks lending out money is not all that bad either. Banks have relied upon the assumption that depositors as a whole will not withdraw large amounts of their deposits (which has held true) to lend out a portion of their deposits, which makes offering deposit accounts profitable. Banks lending money for things like houses and cars also allow people to pay for things over a time that is closer to the time they will use said items verses up front. I believe that forcing people to pay for everything up front, or renting property would likely eventually result in entities very closely resembling a government owning nearly all of property who rents out property to citizens, effectively exerting control over citizens that rivals places like North Korea.
The above is not the best system or the most in line with my personal beliefs, however it does give citizens personal responsibility to invest their retirement savings as they deem best, takes away significant amounts of government control over retirement accounts, while having certain features that makes it unlikely that the program would be entirely undone the next time progressives have supermajorities in congress along with the white house, which will eventually happen.
My concern about giving away government owned land is that a lot of the land is only valuable in very large potions, so a $33k parcel would often have little effective value, and also the value of many parcels would likely change by a lot when certain groups of parcels get developed, while others do not.
Another concern about outright dismantling the social security system is that the next time progressives have super majorities, they can just create a new social security-like system, potentially one that gives government even more control, and creates an even bigger welfare state.
Quote from: theymos
I'm more imagining 90% of banks and other financial institutions collapsing. Deflation seems like a comparatively minor issue. But getting rid of this cancer on the economy would be worth the short-term pain IMO, even from a statist perspective. I think that there'd be pure economic hell for only a year or two, and things would be better than before within a decade, on net.
Banks rely so heavily on US government debt being repaid on a timely basis that almost all of them would likely fail if the US government were to default on their debt obligations. This would also result in the FDIC failing, which would mean that account holders would only receive a small percentage of their deposits. I don't think banks are all that bad though. For deposit holders, they keep money safe from theft, and pay a small amount of interest. Deposit accounts are not very profitable for banks, carry a lot of risk of losses, so they probably would not offer deposit accounts if they are unable to lend some of their deposits out. If everyone had to keep all their money in physical dollars in their house (or other property), there would probably be a lot more violent crimes, including robberies because it would be known that everyone has large amounts of cash in their homes. The deposit services that banks offer also make traveling less risky because without deposit services you would need to carry sufficient cash to cover all expenses of your trip when traveling and getting robbed on the highway would leave your stranded.
Banks lending out money is not all that bad either. Banks have relied upon the assumption that depositors as a whole will not withdraw large amounts of their deposits (which has held true) to lend out a portion of their deposits, which makes offering deposit accounts profitable. Banks lending money for things like houses and cars also allow people to pay for things over a time that is closer to the time they will use said items verses up front. I believe that forcing people to pay for everything up front, or renting property would likely eventually result in entities very closely resembling a government owning nearly all of property who rents out property to citizens, effectively exerting control over citizens that rivals places like North Korea.
I think they will create a massive incident somewhere - maybe a war. There is also the situation with DeutscheBank, don't they owe more than the US? and then there is the EU - nobody has mentioned how they are going to repay the UK for their share of the EU assets after Brexit.
Somehow, they have to shove the US dollar under the bus, and create a new crypto based currency for the US. I believe that Bitcoin was created as an experimental project in preparation for this currency. Well they must be pretty close to announcing it now.
Somehow, they have to shove the US dollar under the bus, and create a new crypto based currency for the US. I believe that Bitcoin was created as an experimental project in preparation for this currency. Well they must be pretty close to announcing it now.
The ultimate problem is entitlement spending, which makes up of over 2/3 of federal outlays verses ~48% 20 years ago. The increase in entitlement spending over the last 20 years is more than enough to account for the entire federal deficit.
If I was made emperor of the US but I was for some reason forced to maintain some level of statism rather than tearing the whole thing down, I think I'd resolve entitlements by:
1. Shut the programs down completely.
2. Calculate a dollar amount that people are "owed" due to "paying into" the programs.
3. The federal government owns 640 million acres of land (28% of the US landmass). Distribute as much of this as possible to the people owed money in entitlements, proportional to how much they're owed.
Example: Say that 600 million acres of the 640 million acres can be disposed of. The social security trust fund has received a total of about $20 trillion over its history. So for every $33k that you personally contributed to the trust fund, you'd get an acre of federal land chosen randomly (which you can sell if you don't like it). Or something in that general vein.
This would IMO be more honest than increasing the social security retirement age to 80 or whatever they'd have to do to get entitlements under control now, it'd put an end to the disastrous programs once and for all, and it'd reduce the government's size / control over assets.
(There's zero chance of them actually doing this, of course.)
Quote
A default on our debt would likely result in massive deflation because so much of the economy relies upon this debt being worth face value (less losses due to interest rate increases), which would result in the economy essentially coming to a halt.
I'm more imagining 90% of banks and other financial institutions collapsing. Deflation seems like a comparatively minor issue. But getting rid of this cancer on the economy would be worth the short-term pain IMO, even from a statist perspective. I think that there'd be pure economic hell for only a year or two, and things would be better than before within a decade, on net.
Trump actually talked about partially defaulting on treasuries (ie. a "haircut") during his campaign, so maybe it's not entirely outside of the mainstream. Some have speculated that he's pushing for all of this spending because he knows that the whole debt & USD system will collapse at some point, so he wants to build up long-lasting capital in domestic infrastructure and military equipment while the ponzi scheme is still running. (I don't really buy this theory personally, though.)
The ultimate problem is entitlement spending, which makes up of over 2/3 of federal outlays verses ~48% 20 years ago. The increase in entitlement spending over the last 20 years is more than enough to account for the entire federal deficit.
Without entitlement reform, government borrowing will spin out of control regardless of what happens to defense and "discretionary" spending.
A default on our debt would likely result in massive deflation because so much of the economy relies upon this debt being worth face value (less losses due to interest rate increases), which would result in the economy essentially coming to a halt.
I am conflicted if this (or hyperinflation) will result in a net benefit for crypto, as there would be the (increased) risk of miners being seized because of gov/police corruption, which may result in more double spend attacks, which would lead to decreased confidence in crypto.
Without entitlement reform, government borrowing will spin out of control regardless of what happens to defense and "discretionary" spending.
A default on our debt would likely result in massive deflation because so much of the economy relies upon this debt being worth face value (less losses due to interest rate increases), which would result in the economy essentially coming to a halt.
I am conflicted if this (or hyperinflation) will result in a net benefit for crypto, as there would be the (increased) risk of miners being seized because of gov/police corruption, which may result in more double spend attacks, which would lead to decreased confidence in crypto.
You hit in right on the head theymos. I expect to see more quantitative easing by the Fed and interest rate hikes. Americans are going to get into more and more debt, wages will still be at an all time low, no matter what the govt. says. They're just digging us into a bigger hole. It's never ending, or better yet...it's not going to end well.
The idiot Republicans in the US congress just massively increased spending. Over the next few years, the yearly deficit will probably double from $600 billion to $1.2 trillion as a result. I have very little faith in congress, and there's a long history of the Republicans and Democrats working together to recklessly increase both military and domestic spending, but even I was surprised by just how ridiculous this spending increase was.
Previously most people would say that although they didn't want to balance the budget this year, in the future it could be balanced. Republicans would sometimes lay out plans to balance the budget in 15 years or some such nonsense. But people will soon be realizing that this is never going to happen now. In a few years just the interest on the debt will be 5% of GDP or more, and this will grow exponentially.
I think that this will come to a point of crisis within the next decade. How do you guys see things playing out? Several possibilities come to my mind:
- The US prints money like crazy, probably to the point of hyperinflation.
- The US explicitly defaults on its bonds. This'd basically be armageddon for everything in contact with the fiat financial system (eg. banks, stocks, retirement funds, etc.), worldwide.
- Taxes are massively increased. Income tax increases probably wouldn't be sufficient; they'd probably need a national VAT of 15-25% to even begin to bring the budget in order. But there are serious political and legal impediments to such a thing.
- I really can't see them cutting spending in any significant way, but maybe it'd be possible if tons of politicians were replaced and/or the crisis grew large enough.
What I'd recommend they do is default on the bonds and just live with the few years of massive fallout, while simultaneously cutting spending massively. But there's very little chance of that. The hyperinflation route seems most likely to me.
(In any case, it's probably good for crypto...)
Previously most people would say that although they didn't want to balance the budget this year, in the future it could be balanced. Republicans would sometimes lay out plans to balance the budget in 15 years or some such nonsense. But people will soon be realizing that this is never going to happen now. In a few years just the interest on the debt will be 5% of GDP or more, and this will grow exponentially.
I think that this will come to a point of crisis within the next decade. How do you guys see things playing out? Several possibilities come to my mind:
- The US prints money like crazy, probably to the point of hyperinflation.
- The US explicitly defaults on its bonds. This'd basically be armageddon for everything in contact with the fiat financial system (eg. banks, stocks, retirement funds, etc.), worldwide.
- Taxes are massively increased. Income tax increases probably wouldn't be sufficient; they'd probably need a national VAT of 15-25% to even begin to bring the budget in order. But there are serious political and legal impediments to such a thing.
- I really can't see them cutting spending in any significant way, but maybe it'd be possible if tons of politicians were replaced and/or the crisis grew large enough.
What I'd recommend they do is default on the bonds and just live with the few years of massive fallout, while simultaneously cutting spending massively. But there's very little chance of that. The hyperinflation route seems most likely to me.
(In any case, it's probably good for crypto...)
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