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Thread: Stocks: Investors on edge over the cliff

  1. #31
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    Re: Stocks: Investors on edge over the cliff

    Quote Originally Posted by Khayembii Communique View Post
    Well there really isn't a problem. It is a manufactured issue. The problem isn't with the deficit, it's with employment and GDP growth.
    Yeah after Obama borrowed and spent 6 trillion in just 4 yrs and will borrow another 4 trillion in the next 4 yr, for all that money we got 2% GDP and 8% unemployment.

    Right now the government should be concerned with assisting in getting the economy moving again, going through the remains of the housing bubble, consolidating and concretizing Dodd-Frank so that banks know what to expect going forward in terms of regulation, and so on.
    Obama has been in office for 4 yrs and he has done nothing for the economy except spend money and give us Obamacare that is adding yet another entitlement to the list of many.

    Focusing on the deficit right now is the height of stupidity.
    What is stupid is you thinking we can spend our way out of Obama's anemic economy, that is the height of stupidity. Further deficits run up our national debt, but you don't care about that, as long as you don't have to pay for it.

    Why do you think everyone is so worried about the fiscal cliff?
    Do higher taxes mean anything to you?

    The federal budget is approved by both congress as well as the president. Blaming Obama for the budget deficit is rather silly in that context.
    Let me put it this way, under Obama and his liberal clan will have raised the national debt by over 10 trillion in Obama's 8 yr term. More than all the presidents before him combined.

    Also, the federal deficit does not cause GDP growth to slow. This is very obvious and supported by rudimentary economics and a cursory study of the federal budget deficit/surplus and GDP growth over time.
    I never said it did, but the National debt will, and Obama throwing money at his economy thinking that will cure his economic problem is flat out stupidity.

    Finally, debt is not a drag on the economy necessarily, and certainly not for the reason you state, simply because the debt is financed through the issuance of securities and not taxation.
    Geeee debt is financed by securities, that is brilliant. But what you fail to realize is those securities are loans that have to be paid back. And when we have to pay them back that takes capital out of the economy. We have already spent 20+ trillion of borrowed money that was injected into our economy so we could live high on the hog, and when it's time to pay that money back you have to dig deep into your pocket. Thus placing a severe drag on the economy.

    We always have the option of defaulting on our debt or keep printing more and more money to pay the debt, however that drives the value of our dollar down. So either way our economy is sucking big time. But of course you know that, but don't care, your a tax, borrow, spend and give freebees liberal. Debt means nothing to a liberal.
    Liberals - Punish the Successful, Reward the Unsuccessful
    Liberals - Tax, Borrow, Spend, and Give Free Stuff
    Obama's legacy - President Donald Trump

  2. #32
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    Re: Stocks: Investors on edge over the cliff

    Quote Originally Posted by Khayembii Communique View Post

    Language is political. Each of us talks, listens, and thinks in his/her own special language that has been shaped by our culture, experiences, profession, personality, mores and attitudes. The chances of us meeting someone else who talks the exact same language is pretty remote.

  3. #33
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    Re: Stocks: Investors on edge over the cliff

    Quote Originally Posted by Born Free View Post
    Geeee debt is financed by securities, that is brilliant. But what you fail to realize is those securities are loans that have to be paid back.
    They already are paid back. The federal government pays on matured bonds every single day. They issue more debt securities to do so.

    And when we have to pay them back that takes capital out of the economy. We have already spent 20+ trillion of borrowed money that was injected into our economy so we could live high on the hog, and when it's time to pay that money back you have to dig deep into your pocket. Thus placing a severe drag on the economy.
    I have bolded your fallacy. There is never going to be a time where the US government is going to need to pay back the national debt.

    We always have the option of defaulting on our debt or keep printing more and more money to pay the debt, however that drives the value of our dollar down. So either way our economy is sucking big time. But of course you know that, but don't care, your a tax, borrow, spend and give freebees liberal. Debt means nothing to a liberal.
    The bolded is wrong because while the money supply is affected by open market operations it is not dictated by it. This is why, for example, in the early 2000's Greenspan's lowering of interest rates actually made sense. If your bold assertion was right, then inflation would have been huge; instead, the Fed was battling deflation before prices settled within their 2% inflation target ~2005.

    You apparently do not understand how the Fed sets interest rates, what relation it has to the money supply, how the money supply changes and how all of these are related to inflation and GDP.
    "I do not claim that every incident in the history of empire can be explained in directly economic terms. Economic interests are filtered through a political process, policies are implemented by a complex state apparatus, and the whole system generates its own momentum."

  4. #34
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    Re: Stocks: Investors on edge over the cliff

    Quote Originally Posted by Khayembii Communique View Post
    They already are paid back. The federal government pays on matured bonds every single day. They issue more debt securities to do so.



    I have bolded your fallacy. There is never going to be a time where the US government is going to need to pay back the national debt.



    The bolded is wrong because while the money supply is affected by open market operations it is not dictated by it. This is why, for example, in the early 2000's Greenspan's lowering of interest rates actually made sense. If your bold assertion was right, then inflation would have been huge; instead, the Fed was battling deflation before prices settled within their 2% inflation target ~2005.

    You apparently do not understand how the Fed sets interest rates, what relation it has to the money supply, how the money supply changes and how all of these are related to inflation and GDP.
    I know according to you debt is not a problem but here are a couple that don't agree with you, and of course I'm included. Oh I know you predict a boom, like the wold will come to an end, but you can't say when. It could be 50 yrs from now, or 100 yrs or 200 yrs. In the meantime we are racking up debt by over a trillion a yr, and that is all Ok with you as it has no consequences. So it is you that apparently do not understand anything when it comes to economics.

    Why is the National Debt a Problem?

    The interest paid per year increases and could eventually be more than all other spending. It drains our wealth and sends a large percentage of it overseas. Eventually you are
    only able to pay the interest and nothing else. This means bankruptcy.
    Interest on the debt (as of 2010) was larger than all but a handful of programs, over $400 Billion. Just think of what you could do with your share of that money.
    We will no longer control our own destiny. The owners of the debt will.
    The interest alone has been bigger than what is spent on Medicare.
    Lower growth. Fewer Jobs. Lower salaries. It hurts everyone now, and future generations much more through lower growth compounded over decades.
    Compounding. Debt compounded becomes extremely large, very quickly.
    It weakens the dollar when it becomes excessive.
    [New for 2010] If interest rates rise in general, they will increase the United States' interest payments dramatically.
    On January 20, 2001, the debt was $5.7 trillion. Eight years later, January 2009, it was $10.6 trillion, an increase of $4.9 trillion, or 86 percent. In July 2010 the national debt stood $13.2 trillion, an increase of $2.6 trillion or 25 percent - in 18 months since January 2009. In May 2011, the debt stood at $14.3 Trillion, a $3.7 trillion increase in 28 months.

    Why Is the National Debt a Problem?

    But both President Obama and Mitt Romney acknowledged Monday night what a chorus of former military leaders, current administration officials and fiscal hawks have been saying: that the country's debt is a threat to national security.

    "A nation with our current levels of unsustainable debt ... cannot hope to sustain for very long its superiority from a military perspective, or its influence in world affairs," Admiral Michael Mullen, former chairman of the Joint Chiefs of Staff, said last month.

    The concern: If the debt continues to grow unbridled, the U.S. government will be constrained in its ability to pay for what it wants to do militarily and diplomatically. And it could limit the country's leverage with foreign powers.

    http://money.cnn.com/2012/10/22/news...ebt/index.html

    And yes I could give many more examples, and be sure the interest rate does not go up as you know what that would do, yep it would suck billions more out of our economy than what already is and much of that money goes to other countries. So much for liberals hating outsourcing, you love to outsource to China, even San Francisco, the most liberal city outsourced the building of the San Francisco Oakland Bay Bridge to China.
    Liberals - Punish the Successful, Reward the Unsuccessful
    Liberals - Tax, Borrow, Spend, and Give Free Stuff
    Obama's legacy - President Donald Trump

  5. #35
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    Re: Stocks: Investors on edge over the cliff

    But Krugman says debt doesn't matter...

  6. #36
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    Re: Stocks: Investors on edge over the cliff

    Quote Originally Posted by Born Free View Post
    I know according to you debt is not a problem but here are a couple that don't agree with you, and of course I'm included. Oh I know you predict a boom, like the wold will come to an end, but you can't say when. It could be 50 yrs from now, or 100 yrs or 200 yrs. In the meantime we are racking up debt by over a trillion a yr, and that is all Ok with you as it has no consequences. So it is you that apparently do not understand anything when it comes to economics.

    Why is the National Debt a Problem?

    The interest paid per year increases and could eventually be more than all other spending. It drains our wealth and sends a large percentage of it overseas. Eventually you are
    only able to pay the interest and nothing else. This means bankruptcy.
    Interest on the debt (as of 2010) was larger than all but a handful of programs, over $400 Billion. Just think of what you could do with your share of that money.
    We will no longer control our own destiny. The owners of the debt will.
    The interest alone has been bigger than what is spent on Medicare.
    Lower growth. Fewer Jobs. Lower salaries. It hurts everyone now, and future generations much more through lower growth compounded over decades.
    Compounding. Debt compounded becomes extremely large, very quickly.
    It weakens the dollar when it becomes excessive.
    [New for 2010] If interest rates rise in general, they will increase the United States' interest payments dramatically.
    On January 20, 2001, the debt was $5.7 trillion. Eight years later, January 2009, it was $10.6 trillion, an increase of $4.9 trillion, or 86 percent. In July 2010 the national debt stood $13.2 trillion, an increase of $2.6 trillion or 25 percent - in 18 months since January 2009. In May 2011, the debt stood at $14.3 Trillion, a $3.7 trillion increase in 28 months.

    Why Is the National Debt a Problem?

    But both President Obama and Mitt Romney acknowledged Monday night what a chorus of former military leaders, current administration officials and fiscal hawks have been saying: that the country's debt is a threat to national security.

    "A nation with our current levels of unsustainable debt ... cannot hope to sustain for very long its superiority from a military perspective, or its influence in world affairs," Admiral Michael Mullen, former chairman of the Joint Chiefs of Staff, said last month.

    The concern: If the debt continues to grow unbridled, the U.S. government will be constrained in its ability to pay for what it wants to do militarily and diplomatically. And it could limit the country's leverage with foreign powers.

    Why debt is a threat to national security - Oct. 22, 2012

    And yes I could give many more examples, and be sure the interest rate does not go up as you know what that would do, yep it would suck billions more out of our economy than what already is and much of that money goes to other countries. So much for liberals hating outsourcing, you love to outsource to China, even San Francisco, the most liberal city outsourced the building of the San Francisco Oakland Bay Bridge to China.
    Well, it appears that you are unable to engage the topic.
    "I do not claim that every incident in the history of empire can be explained in directly economic terms. Economic interests are filtered through a political process, policies are implemented by a complex state apparatus, and the whole system generates its own momentum."

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