Posted on 06/26/2012 3:56:44 AM PDT by Kaslin
I have pondered this question since the late '70's. My theory is the following:
computers,
In past history, governments always, eventually... hit SOME kind of hard limit that forced reality back into the system. You could only mint so many coins, print so many bills, etc....
With the advent of computers, world leaders now have the ability to create virtually infinite supplies of money.. thus, creating the illusion that "all is well".
Reality still settles in on SOME countries... those that lack the ability to compute their own money... places like, Argentina, Iceland, Greece, etc.... But, not us... not yet.
I'm still not sure: Can the game go on forever?
I think, "No".
Our ability to inflate faster than ever simply has meant that our balloon has filled up BIGGER than anytime in the past. But, eventually... this too shall pop.
The bubble has moved through various parts of the world's financial system. Now, it has landed on sovereign balance sheets... That's the last stop.
Ths only thing missing now is, the initiator.
THANKS! This one of the best articles I have read in a very long time.. This guy REALLY NAILS it.
Military spending is the origin of a country's future wealth. The military is the first user of new technologies, mainly because they are the only customer willing to pay the initial price. The U.S. Military today is funding the development of robots and all kinds of "cutting edge" technologies. Later these robots will be put to civilian uses. Their work output is the only thing that could possibly pay the bill for today's welfare spending. If we gut the historical driver of technology to keep bloated welfare spending afloat then we're really in trouble.
Most of the people over 65 have their medical bills paid for by the State. Take that away, and all heck will break loose.
We don't have the money to pay for it. Either on the family scale or the State scale, we don't have the money.
I will take my parents in, and my mother in law. That is my duty, and I will sacrafice to do it. But take a good, hard, look around and ask how many can or will do that? There are a good many nearing that 65 mark who are taking care of their parents, and their kids.
And the charities are a in a bad spot. Since the State has taken over the role, most charities function as an arm of the State. Look at the religious adoption agencies (those that remain), or what has happened to the religious medical institutions. They are more and more secular, to the point they have to act like a state agency not a religious institution.
It will be much worse than in the 30’s.
Well, the military is for fighting and its obviously better to fight on someone elses territory than your own, but I take the point. From an economic pov it would be better to abandon a lot of US bases overseas. Saving 300 billion is certainly well worth doing, but bear in mind its chickenfeed compared to the US debt mountain.
We station troops all over the world, at enormous cost, without any economic benefit to us. If we want to play the Empire game, we need to play it to the hilt.
Otherwise retreat to the continental borders and let the world police itself. We can't afford to keep this game up.
And the military pension system needs to be overhauled. We can't afford to have three armies, with only one fighting. That is why we are using mercs now.
The ONLY people who will miss the economic disaster are those in nursing homes - in their late 90's - and the lucky ones who die early... The rest of us will be here for the meltdown.
——But take a good, hard, look around and ask how many can or will do that?-——
There won’t be any non-violent alternatives.(I can foresee violence in the cities, if the collapse is rapid.)
I think we’ll be better off than in the ‘30s, simply because medicine has improved so much since then. Heroic, life-extending measures will most likely be unaffordable, but they didn’t exist at all during the depression.
Overall, I see a return of the family clan, largely for the good of society.
As for medical, who will pay for it? Do you know how much the charge is for a baby? A check up? Anything? If we had to pay out of pocket, there would be little to no health care.
You're talking about the same thing using different words. It's "not possible politically to do," because it's to the personal advantage of some Republicans to do nothing. As a result, many Republicans talk tough when they lack the power to do something meaningful, but when they have the numbers, they do nothing because that's what's in their best interest.
Here's a good example: Right after the RATs and a few RINOs passed Obamacare, the Republicans in Congress from the top down promised to repeal Obamacare as soon as we take back Congress, take back the White House, blah, blah, blah. But now that we are on the verge of doing just that, the Republican leadership has turned wishy-washy on the issue and had even started a whisper campaign to preserve some parts of Obamacafre in the event the SCOTUS does what the Republicans will never actually do, and effectively strike Obamacare from the books. In other words, Republicans talk tough, but when the vote is on the line, way too many of them refuse to to what is right for America at the risk of their policital careers.
Immigration is another example. So is tax reform. Same with entitlement reform.
>>”The Fed is buying 61% of our own debt.”
That’s one reason why I’m stocking up on toilet paper. Get it while it’s still affordable. (I’m only half joking).<<
It’s even worse than it looks because the debt the Fed is concentrating on purchasing is composed primarily of the longer maturities. Thus, while the U.S. Treasury is able to brag that they are extending the maturity of the debt (to a whopping 6+ years in average—but still lower than it was several years ago), the Fed has more than offset that strategy by purchasing most of the longer maturities that the Treasury has issued during Obama’s presidency.
Since the Fed is part of the government, this means that the maturity of the government debt held by the public has decreased significantly, not increased. Furthermore, if interest rates really jump, on the order of Spain or, heaven forbid, Greece, the Fed will find its holdings massively underwater, on the order of hundreds of billions of dollars underwater, not millions...billions. Meanwhile, the publicly-held debt will need to be rapidly rolled over at significantly higher interest rates, blowing a massive hole in any of the current budget predictions.
That said, the eventual outcome might not be a massive inflation (though that would be my best guess); it could be a serious depression instead, accompanied by deflation. Essentially, the current Fed chairman has no clue about how to extract himself from the mess he’s created, but that extraction isn’t likely to be pretty. A soft landing is the least likely outcome.
——As for medical, who will pay for it?——
We will, as we do now. It will be fee-for-service, as it used to be, rather than third-party payment, as it is now. Prices would drop significantly.
But extraordinary care will probably be unaffordable, in most cases. I don’t see any better path.
If few have money to pay for healthcare, doctors will___
Charge remaining customers 5 time normal rates?
Pout and stop practicing?
Adapt and take food, guns, ammo in trade for health care?
I’d hate to be a lawyer seeking health care in a post SHTF scenario.
I read the whole thing. (:
I share many of your emotions.
That is exactly what I see happening as well. Mankind and the family structure will be reorganized back to the living the way that they lived for most of mankind's history, before everyone fell for this stupid Great Fiction that we can all live at everyone else's expense.
Who will make the supplies? There are fixed costs than can only be lowered so much.
A doc may take chickens to set a bone, but Merck won’t to sell you the drug you need to keep alive.
The doctor in my home town growing up would treat you no matter if you could pay or not. But he didn’t control the drug supply.
Of course the military is a legitimate expense and function of the Fed Gov.
I am not lumping it in with entitlements at all. I understand it is categorically different. But it is one of the biggest single line items on our budget, and the cost needs to be contained.
Absolutely I am in favor of tariffs.
Exactly right....well said.
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