We are in big trouble

Discussion in 'Politics' started by miami_thomas, Nov 9, 2012.

  1. miami_thomas
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    miami_thomas VIP Member

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    I think we have reached the point of no return. We are looking at raising taxes and cutting spending of about 503 billion dollars in January and the CBO is predicting that instead of a possible 3 percent growth we would be looking at a recession next year and shrinkage of .5 percent. Now these cuts and taxes would lower the deficit to about 900 billion but with a new recession revenues would drop and more people would join government programs and essentially increase the deficit. I think we are in a doomed economy no matter what we do. I think our nanny economy has reached the point to where we actually have to collapse and go bankrupt to come out on the other side cleaned up. This is exactly why government should not be allowed to take the place of charity. The problem is no one takes responsibility for the government’s money and does not think twice about borrowing nearly as much money as it makes to pay for charity. The biggest credit bubble bursts in our history were extremely bad leading to the great depression and the other leading to the previous recession in 2008. This bubble will be far worse because there will be no one to bail the government out.



    Budget office: 'Fiscal cliff' cuts, tax hikes would lead to recession | Fox News
     
  2. WillowTree
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    WillowTree Diamond Member

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    Shut up. It's what the Americans voted for. They wanted misery and now they've got it. Stop complaining.
     
  3. SniperFire
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    SniperFire Senior Member

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    Sovereign debt is sorta like maxing out your credit cards and thinking you are rich because of all the great stuff you have.
     
  4. konradv
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    konradv Gold Member

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    The ball is in Boehner's court. Fiscal measures are initiated by the House. If you're worried, be worried that he'd rather drive us off the cliff than do what's right for the country. It's time to buckle down and do some real governing.
     
    Last edited: Nov 9, 2012
  5. Mac1958
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    Mac1958 Platinum Member

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    .

    Yep, fiscally we've passed the tipping point. It's going to manifest in a generally lower standard of living across the board. The question now is how far the decline will be. People don't see what a $16T debt does to our economy, and far worse, they don't understand the damage higher interest rates are going to cause.

    If it means going from a 60" big screen and two nice cars to a 42" big screen and two medium-nice cars, that's one thing, hopefully that will be the extent. We'll see!

    There's one thing on which we can be certain: The deck hands will be pointing the finger at each other as the boat sinks.

    .
     
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    Last edited: Nov 9, 2012
  6. SniperFire
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    SniperFire Senior Member

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    He will be sending legislation to fix it to the Senate in short order.


    But Obama has already promised to veto it, assuming Reid would even permit the Senate to debate it.
     
  7. G.T.
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    G.T. Diamond Member

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    I disagree. I don't see any signs that the Debt matters, and my evidence is that it hasn't been lowered in over 60 years. Someone tell me what it looks like when the bond holders (which happen to be, mostly the Fed (China's ownership of our debt is grossly overstated, *we* own most of our own debt) come looking to be paid up...

    Taxes are not historically high, yet all the right can seem to speak about is how taxes are crushing business. That is what it means to be living inside of a bubble. Corporate profits hit many all-time highs under Obama, the bad for business President, let's all sweep those facts under the rug.

    He cut 18 different taxes for small businesses. Let's sweep that under the carpet, also.

    Let's not talk about how the recession itself is the reason foodstamps and things have increased - let's blame "entitlement MINDED people," as if that's not GROSSLY overstated, also.

    Social Security needs reform, that doesn't mean we're done-for, it just means we need ideas. 51% of the Country is on "some sort of" assistance? Someone needs to break down what's inside of that 51%, because many of those inside of said 51% have PAID FOR what they're on, in BLOOD, or in DEDUCTIONS all of their working lives. Calling it entitlements when you worked all of your life like you were supposed to is a farce.
     
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  8. miami_thomas
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    miami_thomas VIP Member

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    How do you fix it? Right not we owe 16.4 trillion dollars. The economy sucks so the interest rates are only about 1.2 percent which means we only pay about 180 billion in interest. If the economy were to pick up, then the interest rates could jump back to 2008 levels of 4.5% or even higher. This would increase our interest on 16.4 trillion to about 770 billion dollars. We are kind of at the damned if we do and damned if we don’t. The fact is at the rate we are going we will get to the point that all our revenue will just be going to paying for the interest. Think about this just to balance the deficit you would need to pay 150% more in federal taxes just to eliminate the deficit if the economy stayed the same and interest rates only went up to 4.5% and we did it today. If we don’t and we punt to ball, in 4 years the interest will be 1.3 trillion. I can tell you know if my taxes went up 150% I would have to cut a ton of things out of my life. Then those cuts would impact companies that would turn around and cuts costs and start a domino effect that would essentially throw us into a depression. If we don’t cut the deficit and just keep cruising along, eventually people will stop loaning us money and we would have to raise taxes and cut everything all at once with not safety valve what so ever and that would throw us in to a depression. Does anyone have an out?
     
  9. WillowTree
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    We know, liberals can't be held accountable for any thing. it's why we love you.
     
  10. Mac1958
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    Mac1958 Platinum Member

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    Take a look at the percentage of our economy that already goes to nothing but paying off debt/Treasuries. Then calculate what is going to happen, what it's going to cost us, when we're still borrowing at a frantic pace but paying 7% for 10-year notes instead of 1.75%.

    I hope I'm wrong, I hope you're right.

    .
     

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