Tag: debt

Rising Debt + Rising Rates

Guest Post by Northman Trader

Have they all lost their collective minds? Look I get that some people are leaning Democrat versus Republican and vice versa and that’s fine, but what exactly are voters getting? If, on the one hand, you think Democrats tax and spend too much you get Republicans on the other hand who cut taxes with disproportional benefit to the top 1% and then spend even more. Fiscal conservatives? Please.

In early February the US government was already scheduled to borrow nearly $1 trillion this year. 

A week later and that figure is already out the door as this week as both parties agreed to expand spending caps seemingly preparing for World War III. An incremental hundreds of billions of dollars to the military budget alone in just 2 years. What for? To what end? It’s a bonanza for defense contractors surely and the president apparently wants a parade, but have we entered the math no longer applies zone?

The numbers are staggering:

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BIPARTISANSHIP

“If you were against President Obama’s deficits, and now you’re for the Republican deficits, isn’t that the very definition of hypocrisy?”

“Are we to be conservative all the time, or only when we’re in the minority? Now some will say, “We must govern.” My question about governing is, does governing mean abandoning one’s principles?”

Rand Paul

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HOSTILES

Christian Bale in Hostiles

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I don’t like going to the movies. Too much hassle, too many commercials and previews, too expensive, and 90% of the movies are worthless drivel, SJW inspired crap, or government buoyed propaganda. Last weekend was my wife’s birthday and she wanted to see a movie. When she shockingly suggested a western, I reluctantly agreed. So my wife and one of my sons got in the car and headed to an old Franks theater in Montgomeryville that only charges $8.50. I had seen a brief review of Hostiles on-line and saw it got a decent rating on rotten tomatoes. I was looking forward to being mildly entertained.

The next two hours and fifteen minutes of this dark, somber, violent, morally ambiguous treatise about the old west cannot be described as enjoyable. But I did find it riveting and thought provoking. Christian Bale, as Captain Joseph Blocker, mournfully carries out his duties without a single smile crossing his bearded countenance for the entire movie. The tone, atmosphere and message of this film reminded me of my favorite western and subject of the final part of my five part series based on Clint Eastwood movies – Unforgiven. One of the soldiers in Hostiles even has dialogue almost matching Will Munny’s foreboding exchange at the end of Unforgiven:

“That’s right. I’ve killed women and children. I’ve killed just about everything that walks or crawled at one time or another. And I’m here to kill you, Little Bill, for what you did to Ned.”

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Contemplations on America and 4% GDP Growth

Guest Post by Chris Hamilton
Economic prognosticators (Jamie Dimon, among them) suggest that 4% GDP growth is likely and that economic good times have returned.  I haven’t a clue what they are smoking.  I’ll lay out how the US economy has grown ever more reliant on cheap debt to buy ever more intangible services creating a decelerating number of full time jobs among a population that is growing ever more slowly (the basis of a growing consumer base).  And that’s just scratching the surface.
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The Real Bleep-Hole Moment—–$40 Trillion And Counting

Guest Post by David Stockman

 

You can call it the bleep-hole moment (per the Fox “family channel”) or the shit-hole moment (per the rest of the MSM), but what you can’t call yesterday’s contretemps in the White House is evidence that sentient adults are in charge of the Imperial City.

And, no, we are not getting down on the Donald for using a swear word—nor are we trying to out race-card Don Lemon as to the obvious implications of the President’s crude phraseology.

Indeed, even prior to yesterday’s outburst it was hard to deny that Trump is a semi-literate bully and that he never got (read) the memo on racial comity and respect. But we actually happen to think that the Donald’s potty-talk eruption resulted not from some dark place in his mind and heart, but from sheer frustration as the intractability of the immigration issue closes in on him.

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Unhinged, Part 1: The GOP’s Fiscal Madness

Guest Post by David Stockman

The watchword for 2018 is: UNHINGED!

That refers to Wall Street, Washington, the Dems and the GOP, and all the far and near corners of the planet which are implicated in their collective follies.

The latter begins with the fact that Imperial Washington has become so dysfunctional that the most powerful government on earth can’t seem to keep its doors open for more than a few weeks at a time.

The next continuing resolution (CR) deadline is January 19 and the route thereto resembles nothing less than kick-the-can-alley. It’s strewn with $100 billion of unfunded disaster aid, defense and nondefense sequester caps fixing to be busted by another $100 billion, 700,000 dreamers waiting to be deported, 9 million poor children (CHAPS) facing termination of medical care and millions more ObamaCare recipients who have been promised that cost abatement subsidies to insurance companies will be funded forthwith.

And along with those major bouncing cans are countless more articles of graft and booty cued-up on Capitol Hill looking for a legislative gravy train (i.e. CR) to hop aboard.

Continue reading “Unhinged, Part 1: The GOP’s Fiscal Madness”

A Bedtime Story (Or Explaining Our Money System To A 14-Month Old)

Authored by Bill Bonner via InternationalMan.com,

We are explaining our money system to our grandson, James, now 14 months old…

His mother tries to get him to go to bed at 9 p.m. But the little boy’s internal clock is still on Baltimore time; it tells him it is much too early to go to sleep.

Bill’s living room transformed into a makeshift nursery

Grandpa takes over, drawing out the monetary system like a general spreading a map on a field table. “Here is the enemy,” he says gravely. “They have us completely surrounded. We’re doomed.”

James grumbles. He squirms. He has a sunny, optimistic temperament. But we think our explanations are sinking in.

He seems to understand…

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This Is Where America’s Most Debt-Burdened People Live

Americans have racked up almost $13 trillion in personal debt for things like mortgages, car notes and student loans. $13 trillion is such an enormous pile of money, it’s hard to imagine what that looks like across the country. So, HowMuch.net  created a new map to figure out exactly what’s going on…

 

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Source: HowMuch.net

GOBankingRates recently conducted a survey in which they asked Americans how much debt they had. This included things like a mortgage, credit card debt, student loans, car notes and medical bills—basically every major category of debt. They broke the respondents down by state to calculate an average total debt load, which we then mapped across the country. As one can see, people living in states colored dark red and pink have higher debt burdens (as much as $500k) compared to light and dark blue, where the debt load is less than $50k. Continue reading “This Is Where America’s Most Debt-Burdened People Live”

JUDGING MY 2017 PREDICTIONS

“Those who have knowledge, don’t predict. Those who predict, don’t have knowledge. “ – Lao Tzu

“Prediction is very difficult, especially if it’s about the future.” –Nils Bohr

Last year about this time I did a two part forecast for 2017: A BIASED 2017 FORECAST (PART ONE) and A BIASED 2017 FORECAST (PART TWO). I hadn’t re-read them until today. They were written just after the biggest presidential upset in modern history. Liberal tears were flowing freely and the accusations of Putin throwing the election to Trump had just begun. Two quotes from Part One are as pertinent today as they were then.

“A reliable way to make people believe in falsehoods is frequent repetition, because familiarity is not easily distinguished from truth. Authoritarian institutions and marketers have always known this fact.” – Daniel Kahneman, Thinking, Fast and Slow

“It’s frightening to think that you might not know something, but more frightening to think that, by and large, the world is run by people who have faith that they know exactly what is going on.” –  Amos Tversky

The Deep State and their use of propaganda through the fake news corporate media have been revealed by Trump during his first year in office to be the true enemies of the people. The Washington establishment on both sides of the aisle have shown their true colors after being goaded by thousands of provocative Trump tweets. The Deep State establishment has been in control for so long they have been flabbergasted by Trump, who plays the game sometimes and then suddenly flips over the game board and reveals how they have been cheating and misleading the American citizens.

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A CRITICAL THINKING PERSON MIGHT ASK

I know some people don’t like charts, but I think they tell stories. The two charts below tell a story the mainstream media, Trump, Wall Street, and the Deep State don’t want revealed. The first chart shows the year over year percentage change in personal income taxes collected by the Federal government and the second chart shows the year over year percentage change in corporate income taxes collected by the Federal government.

The government drones can’t seasonally adjust, massage, or fake these numbers like they can inflation and unemployment.

A critical thinking person might ask, how can the unemployment rate have fallen to levels last seen in 2007 if personal income taxes collected has been essentially flat for the last two years? The last time unemployment was supposedly this low, the Feds were collecting taxes at a 12% to 18% annual rate over the prior year. Either the BLS is lying about the unemployment rate or the jobs being added are nothing but low paying shit jobs.

A critical thinking person might ask, if the stock market is at record highs because the economy is doing so well and corporations are rolling in dough, why have corporate taxes collected by the Federal government declined for the last three years? Corporate taxes collected have declined because corporate profits are lower than they were three years ago. Have you heard that fact on CNBC? The market isn’t being driven by corporate profits, but just massive levels of Fed created debt, recklessly low interest rates, and a false narrative being spun by Wall Street, their media mouthpieces and even Trump.

The bullshit is so deep, you need to wear hip boots. Luckily for those in control, there are very few critical thinking people asking questions and absolutely ZERO in the corporate mainstream media questioning the official narrative, because it’s their job to lie, misinform and keep the masses sedated and ignorant of their plight.

Is America In Terminal Decline?

Authored by Raul Ilargi Meijer via The Automatic Earth blog,

John Rubino recently posted a graph from Bob Prechter’s Elliot Wave that points to some ominous signs. It depicts the S&P 500, combined with consumer confidence and savings rate. As the accompanying video at Elliott Wave, What “Too Confident to Save” Means for Stocks, shows, when the gap between high confidence and low savings is at its widest, a market crash -often- follows.

In 2000, the subsequent crash was 39%, in 2007 it was 54%. We are now again witnessing just such a gap, with the S&P 500 at record levels. Here’s the graph, with John’s comments:

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The Black Swan In Plain Sight—Debt Out The Wazoo

Guest Post by David Stockman

 

The black swan in plain sight does emit the Donald’s orangish glow, but at the end of the day its true color is actually red.

That is, monumental towers of rapidly rising debt loom everywhere on the planet. For the moment, the artificial cash flow from this unsustainable borrowing spree is keeping a simulacrum of growth and prosperity alive. Yet this whole outbreak of debt madness—-represented by $225 trillion outstanding on a global basis—-is careening toward a financial and economic dead end that will soon crush today’s fiscally profligate politicians and heedless financial punters, alike, in a devastating reset of bond yields.

For our first case in point, the always excellent Wolf Richter published a great chart over the weekend on the exploding US public debt. To say the least, it constitutes a clanging wake-up call amidst the absolute fantasy world that prevails on both ends of the Acela Corridor. That’s because during the mere 8 weeks since the public debt ceiling was suspended by the Donald’s end-run with Nancy and Chuckles in September, the national debt has spiked by $640 billion.

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IS THIS TIME DIFFERENT?

“This time may seem different, but all too often a deeper look shows it is not. Encouragingly, history does point to warning signs that policy makers can look at to assess risk—if only they do not become too drunk with their credit bubble–fueled success and say, as their predecessors have for centuries, “This time is different”. ― Carmen M. Reinhart, This Time Is Different: Eight Centuries of Financial Folly

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BOOBS ON CREDIT

Do you ever hear something so startlingly mind numbingly ridiculous you realize it must be a sign things have gotten so fucked up something has got to give? As I was driving to work yesterday morning on the Schuylkill Expressway a commercial comes on the radio from a plastic surgeon advertising for anyone looking for a better set of boobs. I had never heard a plastic surgeon commercial before, so I thought that was unusual. But, that wasn’t the best part. This plastic surgeon was offering no money down 18 month interest free financing on your new boobs.

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LIES, LIES & OMG MORE LIES

“There are three types of lies — lies, damn lies, and statistics.” – Benjamin Disraeli

Every month the government apparatchiks at the Bureau of Lies and Scams (BLS) dutifully announces inflation is still running below 2%. Janet Yellen then gives a speech where she notes her concern inflation is too low and she needs to keep interest rates near zero to save humanity from the scourge of too low inflation. I don’t know how I could survive without 2% inflation reducing my purchasing power.

This week they reported year over year inflation of 1.9%. Just right to keep Janet from raising rates and keeping the stock market on track for new record highs. According to our beloved bureaucrats, after they have sliced, diced, massaged and manipulated the data, you’ve experienced annual inflation of 2.1% since 2000. If you believe that, I’ve got a great real estate deal for you in North Korea on the border with South Korea.

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