Point of no Return

[Bush92]

I talked to someone recently that I respect a great deal, and he told me that the US is now to the point where we can not avoid economic collapse. We have become Super Greece. We have so much debt that there is literally no solution. I'm not a pessimistic guy, but on a gut level we all know that we have become Greece. When Average Joe on the street can see it, collapse can't be far away. I don't want to make this a partisan thing. Both sides did it. I'm hoping someone can tell me I'm wrong. Our debt to GDP level might be unreconcilable. I asked my friend why politicians are not trying to do something about it. He laughed and said it wouldn't be politically popular. He again said it wouldn't matter anyway. It could be too late. They are just going to live it up until we go over the cliff. Please tell me I'm wrong. I've got kids. I'm no survival expert, and I can't tell him which berries he can eat. Ok, that might be a little overly dramatic, sorry. I'm not pointing fingers, because the blame is on all sides. Anyone see a way out of this?

Why am I in this hand basket and where am I going?

 

[Siete]

I talked to someone recently that I respect a great deal, and he told me that the US is now to the point where we can not avoid economic collapse. We have become Super Greece. We have so much debt that there is literally no solution. I'm not a pessimistic guy, but on a gut level we all know that we have become Greece. When Average Joe on the street can see it, collapse can't be far away. I don't want to make this a partisan thing. Both sides did it. I'm hoping someone can tell me I'm wrong. Our debt to GDP level might be unreconcilable. I asked my friend why politicians are not trying to do something about it. He laughed and said it wouldn't be politically popular. He again said it wouldn't matter anyway. It could be too late. They are just going to live it up until we go over the cliff. Please tell me I'm wrong. I've got kids. I'm no survival expert, and I can't tell him which berries he can eat. Ok, that might be a little overly dramatic, sorry. I'm not pointing fingers, because the blame is on all sides. Anyone see a way out of this?

so Trump being the true patriot he is took it upon himself to add another glorious $9.5 trillion dollars to debt picture ..

what a swell guy !

es

 

[Bush92]

I’m ready. Well armed. Former infantry. I can go back in the woods off the grid.

 

[DustyInfinity]

Mac1958, You really think we can tax ourselves out of this? Squeezing revenue out of people, without killing the economy, and this will not immediately be thrown down a government rathole? I don't see either party taking a stand. I don't see people who will vote for a solution either. I think this is the slowest train wreck in history, and everybody is just grabbing their popcorn. I'm glad it isn't to the point where it can't be fixed, but I do think we are going over the cliff.

 

[Mac1958]

.

Mac1958, You really think we can tax ourselves out of this? Squeezing revenue out of people, without killing the economy, and this will not immediately be thrown down a government rathole? I don't see either party taking a stand. I don't see people who will vote for a solution either. I think this is the slowest train wreck in history, and everybody is just grabbing their popcorn. I'm glad it isn't to the point where it can't be fixed, but I do think we are going over the cliff.

No, I don't think we can tax our way out of this. There's taxing and there's spending. Pretty simple deal.

If by "over the cliff" you mean an overall drop in our standard of living, I agree. I just don't think it's going to be an event, but a process.

And again, I think it's fair to wonder if we can see a decrease in our material wealth without seeing a decrease in our happiness and contentment.

After all, isn't happiness the bottom line? I'd much rather see my kids happy than wealthy. Some recent high-visibility suicides could be instructive.
.

 

[Natural Citizen]

Anyone see a way out of this?

For what it's worth, I'm in the profession, so I'm pretty much neck-deep in this stuff. Here's my two cents, worth every penny:

In terms of an actual "collapse", I don't think that's something to worry about in the near or mid-range future. What we saw in 2008 was an economy literally hours from real collapse due to a structural problem (the collapse of the real estate market bubble and the derivatives that had created the bubble), and we're just not quite there right now.

The larger problem is that we're slowly suffocating ourselves. It currently costs us +/- $300 billion per year just to service our debt, to pay on the loans (bonds) that have sustained us for so long. That is going to continue to increase as we continue to add debt, and even more so if interest rates continue to climb for new debt.

So in the end, there are only two solves for this: (1) Time, as we pay down our debt/bonds, and (2) less borrowing, which is a function of taxing and spending. The chances of us spending significantly less are fairly small, so there will come a time before long where we'll see taxes increase quite a bit.

Bottom line, and this would be a longer discussion, we won't see Greece, but we will see developed Europe, where we'll have to make due with a 42-inch teevee instead of a 72-inch teevee, less wasted food at the end of our buffet pigout, and a smaller car instead of an Escalade. Is that a horrible thing? I guess that depends on us.
.

A 50% drop in the market is quite possible. We'll see a correction soon.

Then it'll get jiggy.

The path we're on is unsustainable. We can;t kee pmonetizing debt. Our dollar is worth 4 cents right now if we compare it to purchasing power.

I'm buying more gold while it's low.

A 50% market drop would be a perfectly normal bear market after a long bull. That's fine.

The question is whether it would be a normal, healthy, cyclical bear, or a structural bear, as we had in 2008.

I don't see the latter right now. Very few do.

By the way, since 1915, gold has average something like a 2.15% return.
.

I thought this was a fairly accurate overview of the scale of what we're looking at. What do you think?

 

[Mac1958]

Anyone see a way out of this?

For what it's worth, I'm in the profession, so I'm pretty much neck-deep in this stuff. Here's my two cents, worth every penny:

In terms of an actual "collapse", I don't think that's something to worry about in the near or mid-range future. What we saw in 2008 was an economy literally hours from real collapse due to a structural problem (the collapse of the real estate market bubble and the derivatives that had created the bubble), and we're just not quite there right now.

The larger problem is that we're slowly suffocating ourselves. It currently costs us +/- $300 billion per year just to service our debt, to pay on the loans (bonds) that have sustained us for so long. That is going to continue to increase as we continue to add debt, and even more so if interest rates continue to climb for new debt.

So in the end, there are only two solves for this: (1) Time, as we pay down our debt/bonds, and (2) less borrowing, which is a function of taxing and spending. The chances of us spending significantly less are fairly small, so there will come a time before long where we'll see taxes increase quite a bit.

Bottom line, and this would be a longer discussion, we won't see Greece, but we will see developed Europe, where we'll have to make due with a 42-inch teevee instead of a 72-inch teevee, less wasted food at the end of our buffet pigout, and a smaller car instead of an Escalade. Is that a horrible thing? I guess that depends on us.
.

A 50% drop in the market is quite possible. We'll see a correction soon.

Then it'll get jiggy.

The path we're on is unsustainable. We can;t kee pmonetizing debt. Our dollar is worth 4 cents right now if we compare it to purchasing power.

I'm buying more gold while it's low.

A 50% market drop would be a perfectly normal bear market after a long bull. That's fine.

The question is whether it would be a normal, healthy, cyclical bear, or a structural bear, as we had in 2008.

I don't see the latter right now. Very few do.

By the way, since 1915, gold has average something like a 2.15% return.
.

I thought this was a fairly accurate overview of the scale of what we're looking at. What do you think?

Ron Paul has no better handle on the stock market (or, more importantly, the economy) than anyone else. Worse, he's invested heavily in gold, which would appreciate if people listen to him.

Here's what he said in June of 2015:

Ron Paul: Stock market 'day of reckoning' is near

Since the day this was published, the market is up 32.38%. Gold is up 6.85%. I don't take him seriously as a market analyst.
.

 

[Natural Citizen]

Anyone see a way out of this?

For what it's worth, I'm in the profession, so I'm pretty much neck-deep in this stuff. Here's my two cents, worth every penny:

In terms of an actual "collapse", I don't think that's something to worry about in the near or mid-range future. What we saw in 2008 was an economy literally hours from real collapse due to a structural problem (the collapse of the real estate market bubble and the derivatives that had created the bubble), and we're just not quite there right now.

The larger problem is that we're slowly suffocating ourselves. It currently costs us +/- $300 billion per year just to service our debt, to pay on the loans (bonds) that have sustained us for so long. That is going to continue to increase as we continue to add debt, and even more so if interest rates continue to climb for new debt.

So in the end, there are only two solves for this: (1) Time, as we pay down our debt/bonds, and (2) less borrowing, which is a function of taxing and spending. The chances of us spending significantly less are fairly small, so there will come a time before long where we'll see taxes increase quite a bit.

Bottom line, and this would be a longer discussion, we won't see Greece, but we will see developed Europe, where we'll have to make due with a 42-inch teevee instead of a 72-inch teevee, less wasted food at the end of our buffet pigout, and a smaller car instead of an Escalade. Is that a horrible thing? I guess that depends on us.
.

A 50% drop in the market is quite possible. We'll see a correction soon.

Then it'll get jiggy.

The path we're on is unsustainable. We can;t kee pmonetizing debt. Our dollar is worth 4 cents right now if we compare it to purchasing power.

I'm buying more gold while it's low.

A 50% market drop would be a perfectly normal bear market after a long bull. That's fine.

The question is whether it would be a normal, healthy, cyclical bear, or a structural bear, as we had in 2008.

I don't see the latter right now. Very few do.

By the way, since 1915, gold has average something like a 2.15% return.
.

I thought this was a fairly accurate overview of the scale of what we're looking at. What do you think?

Ron Paul has no better handle on the stock market (or, more importantly, the economy) than anyone else. Worse, he's invested heavily in gold, which would appreciate if people listen to him.

Here's what he said in June of 2015:

Ron Paul: Stock market 'day of reckoning' is near

Since the day this was published, the market is up 32.38%. Gold is up 6.85%. I don't take him seriously as a market analyst.
.

Ok. I appreciate your taking time to hear the statesman out.

Well, good luck with it. I'm going to be sliding back to basics in the mean time, while it's early and I can cut the losses of what I project might be a calamity coming. I'm a big fan of sound money. I'll watch you guys from slightly afar and see how it goes.


Irrelevant of all of that, the market sure is fun.

 

[DustyInfinity]

Mac, can you walk me through levels of decline? You said the US is becoming Europe, and the end result is just loss of wealth. Somehow Europe doesn't turn into Greece? How does Europe cope with spending more than they make without becoming Greece? I know individuals can't do this, but I'm curious how nations can spend more than they make indefinitely.

 

[Natural Citizen]

Ron Paul has no better handle on the stock market (or, more importantly, the economy) than anyone else.

Remember this, though?

Ron Paul Predicts Housing Bubble 5 Years Before it Burst




Be careful, guys. Same basic thing is happening right now. It's not a repeat, however. It's a continuation of the same failed monetary policy. Thy patch the leaks once in a while wit hthe printing press and some QE but that's only making it worse and that bubble still blows up.

I think it's gonna be a big bust. Major. And wait'll the tariffs start piling up on us, too.

 

[Mac1958]

Ron Paul has no better handle on the stock market (or, more importantly, the economy) than anyone else.

Remember this, though?

Ron Paul Predicts Housing Bubble 5 Years Before it Burst




Be careful, guys. Same basic thing is happening right now. It's not a repeat, however. It's a continuation of the same failed monetary policy. Th y patch the leaks once in a while, but that bubble still blows up.

Yeah, I've seen that. He didn't mention the derivatives that really exacerbated things, but he was sure right about an artificial bubble.

In all fairness to him, there were only a few people who recognized the derivatives issue early.
.

 

[BasicHumanUnit]

What's the big deal?

A collapse would mean that those who made a lot of money off of imaginary things (like the stock market) will lose it......
And those who bought things they couldn't afford will lose those.....

I wouldn't call it a collapse as much as a "Correction"

 

[Siete]

I’m ready. Well armed. Former infantry. I can go back in the woods off the grid.

yeah go to the woods - a Marine unit could never find you there, or dig you out even if they did.

 

[DustyInfinity]

He wouldn't be hiding from Marines, he'd be hiding from thieving communists roaming the countryside after their 'reveloution.' Venezuela2.0

 

[Aldo Raine]

Ron Paul has no better handle on the stock market (or, more importantly, the economy) than anyone else.

Remember this, though?

Ron Paul Predicts Housing Bubble 5 Years Before it Burst




Be careful, guys. Same basic thing is happening right now. It's not a repeat, however. It's a continuation of the same failed monetary policy. Thy patch the leaks once in a while wit hthe printing press and some QE but that's only making it worse and that bubble still blows up.

I think it's gonna be a big bust. Major. And wait'll the tariffs start piling up on us, too.

Many people were predicting a housing bubble long, long before it burst. You did not need to be a genius to see it coming. When a working stiff making $50,000/ year is buying a $250,000 home with 2 new cars, a boat and a motorcycle, all financed it doesn't take a rocket surgeon! But I do agree precious metals may be a better bet within the next few years.

 

[iceberg]

Anyone see a way out of this?

For what it's worth, I'm in the profession, so I'm pretty much neck-deep in this stuff. Here's my two cents, worth every penny:

In terms of an actual "collapse", I don't think that's something to worry about in the near or mid-range future. What we saw in 2008 was an economy literally hours from real collapse due to a structural problem (the collapse of the real estate market bubble and the derivatives that had created the bubble), and we're just not quite there right now.

The larger problem is that we're slowly suffocating ourselves. It currently costs us +/- $300 billion per year just to service our debt, to pay on the loans (bonds) that have sustained us for so long. That is going to continue to increase as we continue to add debt, and even more so if interest rates continue to climb for new debt.

So in the end, there are only two solves for this: (1) Time, as we pay down our debt/bonds, and (2) less borrowing, which is a function of taxing and spending. The chances of us spending significantly less are fairly small, so there will come a time before long where we'll see taxes increase quite a bit.

Bottom line, and this would be a longer discussion, we won't see Greece, but we will see developed Europe, where we'll have to make due with a 42-inch teevee instead of a 72-inch teevee, less wasted food at the end of our buffet pigout, and a smaller car instead of an Escalade. Is that a horrible thing? I guess that depends on us.
.

moral of the story - get your TV bought ASAP.

great info - thank you!

 

[Hum Dinger]

I talked to someone recently that I respect a great deal, and he told me that the US is now to the point where we can not avoid economic collapse. We have become Super Greece. We have so much debt that there is literally no solution. I'm not a pessimistic guy, but on a gut level we all know that we have become Greece. When Average Joe on the street can see it, collapse can't be far away. I don't want to make this a partisan thing. Both sides did it. I'm hoping someone can tell me I'm wrong. Our debt to GDP level might be unreconcilable. I asked my friend why politicians are not trying to do something about it. He laughed and said it wouldn't be politically popular. He again said it wouldn't matter anyway. It could be too late. They are just going to live it up until we go over the cliff. Please tell me I'm wrong. I've got kids. I'm no survival expert, and I can't tell him which berries he can eat. Ok, that might be a little overly dramatic, sorry. I'm not pointing fingers, because the blame is on all sides. Anyone see a way out of this?

Greece was not the world's currency reserve or the world's largest economy. We are. It makes a big difference.

We'll cuase the Chinese economy to collapse long before ours does.

 

[Hum Dinger]

Ron Paul has no better handle on the stock market (or, more importantly, the economy) than anyone else.

Remember this, though?

Ron Paul Predicts Housing Bubble 5 Years Before it Burst




Be careful, guys. Same basic thing is happening right now. It's not a repeat, however. It's a continuation of the same failed monetary policy. Thy patch the leaks once in a while wit hthe printing press and some QE but that's only making it worse and that bubble still blows up.

I think it's gonna be a big bust. Major. And wait'll the tariffs start piling up on us, too.

Many people were predicting a housing bubble long, long before it burst. You did not need to be a genius to see it coming. When a working stiff making $50,000/ year is buying a $250,000 home with 2 new cars, a boat and a motorcycle, all financed it doesn't take a rocket surgeon! But I do agree precious metals may be a better bet within the next few years.

The 2008 economic collapse was caused by a long time finacial system ponzie scheme - not by the federal debt.

Unfortunately, the banks can do it again if they choose.

 

[blackhawk]

My advice grab a six pack and play this.

 

[imawhosure]

Mac1958, You really think we can tax ourselves out of this? Squeezing revenue out of people, without killing the economy, and this will not immediately be thrown down a government rathole? I don't see either party taking a stand. I don't see people who will vote for a solution either. I think this is the slowest train wreck in history, and everybody is just grabbing their popcorn. I'm glad it isn't to the point where it can't be fixed, but I do think we are going over the cliff.

.

Mac1958, You really think we can tax ourselves out of this? Squeezing revenue out of people, without killing the economy, and this will not immediately be thrown down a government rathole? I don't see either party taking a stand. I don't see people who will vote for a solution either. I think this is the slowest train wreck in history, and everybody is just grabbing their popcorn. I'm glad it isn't to the point where it can't be fixed, but I do think we are going over the cliff.

No, I don't think we can tax our way out of this. There's taxing and there's spending. Pretty simple deal.

If by "over the cliff" you mean an overall drop in our standard of living, I agree. I just don't think it's going to be an event, but a process.

And again, I think it's fair to wonder if we can see a decrease in our material wealth without seeing a decrease in our happiness and contentment.

After all, isn't happiness the bottom line? I'd much rather see my kids happy than wealthy. Some recent high-visibility suicides could be instructive.
.

I go along with Mac on this, but it can be fixed with correct politicians. We could balance the budget just by changing entitlements slightly; just slightly. Problem is, politicians won't touch it, and any politician who does try and tell America the truth is demonized by the politician running against them.

And let me add this---------> Mac, (who I trust) is basing his scenario on current events and fiscal interpretation. What happens if someone gets elected that wants to give free college? Free healthcare? Open borders? Or starts another very costly war? What should worry everyone is that we are at the point where 1 or 2 missteps could very well change the scenario from not so hot, to downright terrible.

As another poster has stated, we ARE THE WORLDS RESERVE CURRENCY! That is a big deal...……….which is exactly why some of our not so friendly adversaries are trying to figure out a way to change that, which Mac will tell you, would make everything dicey rather quickly.

Now, not to make this partisan, but now you know a very good reason why we can't take more people from anywhere that go on the dole. Why we need blue collar jobs for people to work at that did NOT go to college, even if the job only lasts 15 more years. We can NOT expand the welfare state any further, and in fact, we have to shrink it as fast as possible.

A wise man once told me this, because I made a very stupid statement, as I did NOT understand the economics of it. Let us see if Mac concurs------------->

I was told we need to get people 12 dollar an hr jobs, and I started laughing like hell. What good are 12 buck an hr jobs? They probably won't pay 1 red cent into the federal treasury!

Oh contrair I was told-------------> it is NOT about what they pay into the treasury, but rather what they don't take out. Someone receiving benefits for not working, all in all in most jurisdictions gets about 500 bucks a week. That comes out of state, local, and federal taxes. If that person goes to work and does NOT pay 1 red cent in taxes, it is a savings to those 3 authorities, of 500 bucks per week. If they are on welfare, it is more, much, much, more!

And then, if they work, they are FORCED to pay into the economy for what makes the economy grow. Auto, gasoline, clothes, other transportation, etc. The net gain to the economy is massive, just from someone getting a job and keeping it. This is why for all intensive purposes, if we control the border, and immigration, we have a much larger handle on unemployment, and wage growth. Want wages to rise? Make sure there is a shortage of workers. Want to slow wage growth, increase legal immigration, thus cooling inflation.

Back on topic----------->Want to raise taxes, or lower government outlays? Increase employment, and increase wages. Want to balance the budget, or get closer to that? CUT government spending! And remember this---------> Our constitution does NOT say that congress job is only to spend MORE money, they can always spend less money too!