The US Debt Problem

[SiSePuede419]

39 minutes ago, sqwakvfr said:

Some people inherited being rich but many are actually smarter then most and this is how they got  rich. 

Yes.

 

Some people are smarter than most.

 

Unfortunately IQ has no correlation to wealth. 😄

 

And other people were born with a silver spoon in their mouths and inherited a half billion from their parents then squandered it, going bankrupt 6 times.

 

Until they got a hit TV show and Russian money laundering, it was hard to scrape by there for awhile 

 

How's your time machine working to go back and get your spoon?

 

Seems like the most surefire way to get rich. 

 

Start out rich already.  👍

 

[beautifulthailand99]

8 hours ago, black tabby12345 said:

 

Trump doesn't seem to know 1/4 of the US bond held by other countries: Japan, China, UK, Luxemburg, and Cayman Islands.

 

Whether they keep it or not, solely at their mercy.

US of A is supposedly the world's "strongest" country.

But its financial lifeline is technically in the hands of the people outside.

 

If all of the major holders of the US Treasury, dumped it altogether, the result will be catastrophic.

The worst case scenario hasn't yet to take place.

Only while US is still  "trusted" by the rest of the world.

But the man in the White House today, doing his best to Undermine that Vital Factor.

 

The first rule of panicking is don't panic the second rule if you must panic panic first. Greater minds than mine are figuring out how to diversify away from dollars. Parking money in 'stuff' will be a good one. The Thailand condo market may get some of that fallout as is gold bigly time. The euro and sterling will probably drift upwards. The problem with Trump is Trump no one wants to get on a bus with a lunatic driver who has no idea where he wants to go but thinks he's the best driver in the world. The Trump put lasts whilst he does and that's the certainy the market likes to trade.

[KhunLA]

10 minutes ago, beautifulthailand99 said:

The first rule of panicking is don't panic the second rule if you must panic panic first. Greater minds than mine are figuring out how to diversify away from dollars. Parking money in 'stuff' will be a good one. The Thailand condo market may get some of that fallout as is gold bigly time. The euro and sterling will probably drift upwards. The problem with Trump is Trump no one wants to get on a bus with a lunatic driver who has no idea where he wants to go but thinks he's the best driver in the world. The Trump put lasts whilst he does and that's the certainy the market likes to trade.

Don't know about getting away from the 'dollar', but definitely have appreciating assets (non currency notes) that you can touch, possess and able to sell, if & when needed.

 

For me, it's land, as they simply aren't making any more.  Gold seems a decent option, if can't own land, for whatever reason.   Another would be assets that generate income; rental property would be #1 choice for me.

[Cameroni]

5 minutes ago, KhunLA said:

Gold seems a decent option,

 

Yes it is. Which makes it so bizarre that Canada, alone among nations, has decided not to build up any gold reserves. Biggest stupidity of all time maybe.

[Cameroni]

32 minutes ago, SiSePuede419 said:

Unfortunately IQ has no correlation to wealth. 

 

Completely false. You should read the Bell Curve and educate yourself.

[sqwakvfr]

35 minutes ago, SiSePuede419 said:

Yes.

 

Some people are smarter than most.

 

Unfortunately IQ has no correlation to wealth. 😄

 

And other people were born with a silver spoon in their mouths and inherited a half billion from their parents then squandered it, going bankrupt 6 times.

 

Until they got a hit TV show and Russian money laundering, it was hard to scrape by there for awhile 

 

How's your time machine working to go back and get your spoon?

 

Seems like the most surefire way to get rich. 

 

Start out rich already.  👍

 

My guess if the US implemented a 90% income tax rate on the ultra rich many would immediately hire smart lawyers and CPA'a to avoid paying such high rates.  Those who can would consider just packing up and going elsewhere. One of the founders of Google took his wealth to Singapore and parked his millions in SIN banks.  He was then offered citizenship and then he took his US passport to the US Embassy along with citizenship renounciation fee and waved "bye, bye".  Of course not all ultra rich can bug out if the tax rates are raised to such high level but many can.  Also, since how does anyone paying 90% income tax fit into the defintion to "pay your fair share"?  Also, who decides exactly what is every American's "fair share".  Wait Bernie Sanders can decide that because he screams that every chance he gets.  Lastly never voted for Donale Trump and I have never owned a red cap. 

[KhunLA]

8 minutes ago, sqwakvfr said:

My guess if the US implemented a 90% income tax rate on the ultra rich many would immediately hire smart lawyers and CPA'a to avoid paying such high rates.  Those who can would consider just packing up and going elsewhere. One of the founders of Google took his wealth to Singapore and parked his millions in SIN banks.  He was then offered citizenship and then he took his US passport to the US Embassy along with citizenship renounciation fee and waved "bye, bye".  Of course not all ultra rich can bug out if the tax rates are raised to such high level but many can.  Also, since how does anyone paying 90% income tax fit into the defintion to "pay your fair share"?  Also, who decides exactly what is every American's "fair share".  Wait Bernie Sanders can decide that because he screams that every chance he gets.  Lastly never voted for Donale Trump and I have never owned a red cap. 

Wouldn't have to leave the USA at all, just simply stop producing income = no income tax.  Simply live on savings or earned interest.

 

At worse, live on borrowed money, against your assets.  Pay <10% interest on millions, vs 90% tax.

 

Not that a tax over 50%, or ever 40% would ever become a reality.  They are the ones that control everything.

[beautifulthailand99]

9 minutes ago, KhunLA said:

Wouldn't have to leave the USA at all, just simply stop producing income = no income tax.  Simply live on savings or earned interest.

 

At worse, live on borrowed money, against your assets.  Pay <10% interest on millions, vs 90% tax.

 

Not that a tax over 50%, or ever 40% would ever become a reality.  They are the ones that control everything.

Time for the China Solution

 

https://www.currentaffairs.org/news/china-knows-how-to-deal-with-its-billionaires

 

If Musk had been given the Jack Ma treatment, a major social-media platform would not have transformed into a cesspool of racism and misogyny, and there might not be a President Trump laying waste to everyone’s basic constitutional rights (and the world economy) today. That would be a better outcome than the one we’re living with right now. Or imagine if U.S. officials broke up Amazon into several competing companies, the way China did with Alibaba, and sent Jeff Bezos on a Ma-esque mandatory vacation for a few years. There is no particular reason we can’t do those things; only the political will is lacking. But instead, we’ve taken the opposite path to China. We’ve allowed our American oligarchs to pretty much do whatever they want, whenever and however they want. As a result, they now dominate our government and our economy from top to bottom.

[bubblegum]

Can't wait for Japan to start selling.

[Cameroni]

22 minutes ago, bubblegum said:

Can't wait for Japan to start selling.

 

Makes no difference. If that happens the Fed will just print.

[mogandave]

All of the sudden the left cares about the debt. 

 

 

Shocking. 

[TedG]

Debt happens when you build a government you can't afford. 

[TedG]

Just now, mogandave said:

All of the sudden the left cares about the debt. 

 

 

Shocking. 

 

Most of these people don't understand the drivers of the debt. 

[bubblegum]

1 minute ago, mogandave said:

All of the sudden the left cares about the debt. 

 

 

Shocking. 

You live in a different reality.

[bubblegum]

3 minutes ago, Cameroni said:

 

Makes no difference. If that happens the Fed will just print.

Lol. How will that work out.

[beautifulthailand99]

23 minutes ago, Cameroni said:

 

Makes no difference. If that happens the Fed will just print.

The we are into inflation + the inflation from the tarriffs , a recession in the US with a consequential  reductuion in the tax take and a declining dollar as people want more of them + the Trump wild card that for any instance he makes things worse. We are close to a perfect storm which has been decades in the making. Oh and the 5 trillion tax cuts where's that cominmg from ? Biden was a plane on autopilot - Trump is a passenger in First Class that thinks he's a pilot. There are no good off ramps here.

[jvs]

Not only as a country but how many citizens are in debt over their necks?

[mogandave]

14 minutes ago, jvs said:

Not only as a country but how many citizens are in debt over their necks?

And still, they are punished for saving money. 

 

Children are taught Critical Race Theory and gender fluidity rather than math and civics. 

[Cameroni]

1 hour ago, beautifulthailand99 said:

The we are into inflation + the inflation from the tarriffs , a recession in the US with a consequential  reductuion in the tax take and a declining dollar as people want more of them + the Trump wild card that for any instance he makes things worse. We are close to a perfect storm which has been decades in the making. Oh and the 5 trillion tax cuts where's that cominmg from ? Biden was a plane on autopilot - Trump is a passenger in First Class that thinks he's a pilot. There are no good off ramps here.

 

We always get recessions for a short period. No big deal. At all. We also already have inflation. If a little inflation is the price for continuing to service the debt, then it can be done. Like I said, the "debt problem" is not much of a problem, minor one at best.

[swissie]

On 4/14/2025 at 2:34 PM, Cameroni said:

 

No, it is because the US does not have a debt problem. The strength of the US economy is why people biy US Treasury bonds. Not because they like America so much.

 

In effect the US could easily wipe out its debt. Yes, 36 trillion USD of debt sounds like a lot, but when you factor in that the US creates wealth of 29 trillion USD GDP EVERY SINGLE YEAR, you quickly realise that the US debt is not a problem.

 

If the US wanted, it could pass a tax and wipe out national debt in a few years. However, there is no reason to do so. It is not a problem.

Nobody in his right mind would doubt that the US is a rich country. But to focus merely on "government dept" is not the whole picture. Even if every new born baby owes "the government" over 100'000 $ upon birth.

 

There is also "corporate dept" and especially "private dept".

 

As far as private dept is concerned, Americans are world champions. Their homes and cars belong to the bank. Their crdit cards maxed-out. Their retirement stock investment "leaveraged". Upon losing their jobs, after 3 months, personal financial "armageddon" hits.

The "low income crowd" even navigating from month to month.

 

All this not for all, but for many. Way too many.

 

Could it be that is was not "productivity gains" but a gigantic credit bubble that made "The West Great"? Time to deflate the baloon?

 

[Mike_Hunt]

22 hours ago, Cameroni said:

 

We always get recessions for a short period. No big deal. At all. We also already have inflation. If a little inflation is the price for continuing to service the debt, then it can be done. Like I said, the "debt problem" is not much of a problem, minor one at best.

The US needs a recession as a business reset. 

[Cameroni]

12 minutes ago, swissie said:

Nobody in his right mind would doubt that the US is a rich country. But to focus merely on "government dept" is not the whole picture. Even if every new born baby owes "the government" over 100'000 $ upon birth.

 

There is also "corporate dept" and especially "private dept".

 

As far as private dept is concerned, Americans are world champions. Their homes and cars belong to the bank. Their crdit cards maxed-out. Their retirement stock investment "leaveraged". Upon losing their jobs, after 3 months, personal financial "armageddon" hits.

The "low income crowd" even navigating from month to month.

 

All this not for all, but for many. Way too many.

 

Could it be that is was not "productivity gains" but a gigantic credit bubble that made "The West Great"? Time to deflate the baloon?

 

 

There are always these cycles, when debt is available, the stock markets go up, and then a capacity issue is reached, inflation starts, the Fed adjusts monetary policy and things slow down. This is NORMAL. Indeed whenever the capacity to issue debt is reached, and the capacity to service it, the baloon is deflated. This is very, very normal, and necessary.

 

Private consumers taking on debt is of course beneficial for the economy, provided they can service the debt. Only when they cannot, ie it has gone to far, does it become an issue.

 

There were absolutely productivity gains, mostly gained on the backs of the poor, like the rural poor in China, Vietnam and Thailand.

[Cameroni]

12 minutes ago, Mike_Hunt said:

The US needs a recession as a business reset. 

 

Exactly, the inflartion is a sign that something is not right, and everyone knows stocks are overvalued. Things are a bit divorced from reality.

[placeholder]

1 minute ago, Cameroni said:

 

Exactly, the inflartion is a sign that the credit has become too easy, and everyone knows stocks are overvalued. Things are a bit divorced from reality.

Except that inflation isn't really that high and isn't heating up. At least not yer. On the other hand people are fleeing the dollar and interest rates on Treasury bonds are rising. One particularly alarming thing is that usually when people feel jitter about the market, they cash out and put their money in t-bills. That's not happening so much. They're putting their cash elsewhere

[placeholder]

40 minutes ago, Cameroni said:

 

Exactly, the inflartion is a sign that the credit has become too easy, and everyone knows stocks are overvalued. Things are a bit divorced from reality.

Inflation hasn't been heating up. It's been holding or in a very slow  decline. There's no reason for current inflation to be held accountable.

[nauseus]

1 hour ago, Cameroni said:

 

There are always these cycles, when debt is available, the stock markets go up, and then a capacity issue is reached, inflation starts, the Fed adjusts monetary policy and things slow down. This is NORMAL. Indeed whenever the capacity to issue debt is reached, and the capacity to service it, the baloon is deflated. This is very, very normal, and necessary.

 

Private consumers taking on debt is of course beneficial for the economy, provided they can service the debt. Only when they cannot, ie it has gone to far, does it become an issue.

 

There were absolutely productivity gains, mostly gained on the backs of the poor, like the rural poor in China, Vietnam and Thailand.

 

There is nothing "normal" about this mess.

[nauseus]

1 hour ago, placeholder said:

Except that inflation isn't really that high and isn't heating up. At least not yer. On the other hand people are fleeing the dollar and interest rates on Treasury bonds are rising. One particularly alarming thing is that usually when people feel jitter about the market, they cash out and put their money in t-bills. That's not happening so much. They're putting their cash elsewhere

 

 

💡

[stevenl]

3 hours ago, Mike_Hunt said:

The US needs a recession as a business reset. 

 

2 hours ago, Cameroni said:

 

Exactly, the inflartion is a sign that something is not right, and everyone knows stocks are overvalued. Things are a bit divorced from reality.

Ok, so i understand a recession is good. I presume that's why you voted trump, to get a recession.

[Mike_Hunt]

30 minutes ago, stevenl said:

 

Ok, so i understand a recession is good. I presume that's why you voted trump, to get a recession.

Did I vote for Trump? 

[SiSePuede419]

On 4/16/2025 at 6:31 PM, KhunLA said:

Don't know about getting away from the 'dollar', but definitely have appreciating assets (non currency notes) that you can touch, possess and able to sell, if & when needed.

Ahh, the Illiquid Asset King speaks!

 

You do realize that real estate is not a liquid asset?

 

I don't think so. 😄

 

It's not that you "can't touch" a freshly purchased real estate asset for money, it's just that you'll probably lose money on it due to the transaction costs.

 

But yeah, good advice!

 

Get in your time machine and invest in real estate 25 years ago and you can make a lot of money selling it today. 🤗

 

Correct — real estate is generally not considered a liquid asset.

 

Here's why:

Liquidity refers to how quickly and easily an asset can be converted into cash without significantly affecting its value.

 

Real estate typically takes time to sell — weeks, months, or even longer — due to the complexities of the sales process, negotiations, inspections, and legal paperwork.

 

It also often involves transaction costs like agent fees, closing costs, and taxes.

 

Plus, market conditions can affect how quickly a property sells and at what price.

 

In contrast, liquid assets like cash, stocks, or money market funds can be quickly accessed or sold with minimal loss of value.