A Warning: Greece Paying 19.7% Interest On Bonds

Discussion in 'Economy' started by boedicca, Apr 20, 2011.

  1. boedicca
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    boedicca Uppity Water Nymph Supporting Member

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    This is a pretty ugly warning about where we are headed if we don't reduce our debt.

    Greece is now paying nearly 20% (that is credit card rate interest). By comparison, the U.S. net interest outlays in 2010 were about $200B. If the interest rate double, triples, quadruples, quintuples, do the math.

    That is where we are headed - an ever increasing share of our GDP to just pay off the debt for past spending excesses.

    Today’s Telegraph informs us that the yields on Greek, Spanish, Irish, and Portuguese debt climbed to record levels today, and that Irish bank debt has been cut to junk status. In the meantime, Finland’s political tilt rightwards in yesterday’s elections portend a possible veto of any plans by the European Central Bank to bail out these economies on terms unfavorable to the EC member countries paying the bills.

    Greece is now paying 19.7% on 2 year bonds and there is a real fear of government default. This will put even more pressure on the other PIIGS, who are either on or already over the edge. The question then becomes which economies are triaged. Greece, Iceland, and Ireland are all moribund. Portugal is in the middle of a political crisis, and Spain is teetering on the edge. We are seeing the slow motion destruction of the economic and social programs that helped these economies enter the 21st century. It is hard to believe where these countries ranked economically and demographically even 25 years ago.

    The Standard & Poor’s downgrade of U.S. debt is, in my opinion, similar to their downgrade of subprime debt in 2007. Too late and out of touch.


    Economic Storm Warning « Matt's Meditations
     
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  2. william the wie
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    william the wie Gold Member

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    The budget battles are going to get ugly.
     
  3. Meister
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    Meister Platinum Member Supporting Member

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    If we keep borrowing and printing money, were going to make it there....just wait. :eusa_whistle:
     
  4. boedicca
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    boedicca Uppity Water Nymph Supporting Member

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    We're already at the tipping point.
     
  5. syrenn
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    syrenn BANNED

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    I agree, we ill get there soon enough.


    the entire budget needs to be slashed 20%... from everything. No more sacred cows.

     
  6. boedicca
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    boedicca Uppity Water Nymph Supporting Member

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    Federal outlays in 2008 (three years ago!) were approx. $3T. This year the estimate is $3.8T. This rapid growth over such a short period of time is the result of Obamanomics' Spending Binge.

    Roll back outlays to 2008 levels, and then cut out programs from there. The population has not grown enough to warrant a more than 27% increase in spending in THREE YEARS.
     
  7. Mr Liberty
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    Mr Liberty Hater of Socialism

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    We will get there -- No doubt about it. The federal government has not made attempt at "real" cuts to the budget. The only solution they are currently using is to debase the currency. How much longer will our debtors allow this policy to continue. why would China continue to hold US dollars that lose millions in value every day? I am not holding cash.

    Greece was bailed out. There is no one to bail us out. Our economy is far too large. This is social democracy at work. Whether we like it or not, we must now pay the price for this evil experiment. I'm afraid this means a greatly reduced lifestyle for most Americans.
     
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  8. uscitizen
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    uscitizen Senior Member

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    Ohh might need to invest in treasury bonds in the future.
     
  9. Mr Liberty
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    Mr Liberty Hater of Socialism

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    buy silver. You won't be sorry.
     
  10. uscitizen
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    uscitizen Senior Member

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    I bought gold eagles at around $550. Around $250K worth at that price.

    Silver is edging into an investor driven bubble right now.
     
    Last edited: Apr 20, 2011

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