I am a Debt Bear and proud of it.
Nassim Nicholas Taleb, the author of the Black Swan has been echoing my thoughts for a long time. Or maybe I could coin my own sound bite... "Its the Debt Stupid!"
I simply can't be bullish on America with a US government that is utterly out of control in terms of debt. The Deficits are now piling up more deficits since IRS collection cannot meet expenditures. Entitlements and War spending have risen to the highest levels in history and these are not World Wars and we are not winning them. In fact, the terrorist are playing rope a dope with us and just like Gen Gyp are going to outlast us.
Our own gov has fought the IMF's attempt to establish European fiscal discipline. The disintegrated Obama economic team has scurried off the decks of the titanic and are gone. The big spenders know the recovery has failed. Their belief in the absolute God of Keynesian deficit spending lacked the austerity that Keynes demanded during good times. The Gov version we have is just borrow and spend more with no concept of the amount of debt which has accumulated.
Obama by himself has caused more deficit spending than all other presidents since Reagan to Washington COMBINED!!!!!!!!!!!!!!!!!!
The Fed has never had more than 500 billion on account. They now have 2.5 trillion! And Goldman and others in Gov want QE II to unleash another 1.5 Trillion.
It is the unforseen consequences of this insanity that makes me a bear. It is incomprehensible the level of debt in America. Over half the homes in America are underwater. We have a full 12 months of homes in default that can't go into foreclosure because the pipeline is already stuffed full of foreclosures.
Then there are no jobs. There is no credit. Americans have the lowest cash reserves in 30 years. Yet nobody in Gov is talking about debt. To the contrary, they are talking about borrowing more and spending more.
The tea party has attached itself to debt but the opponents of Tea party candidates will look at a Mike Castle / professional politician as "experienced" and Christine O'Donnell as inexperienced or stupid. Yet our government was originally composed of lay persons not professional politicians. They governed by common sense which since the advent of professional politicians has all but been forgotten. Instead we have politicians like ben nelson who sells his vote and pitches for buffett exclusion to finance reform laws. It never ends.
The modern professional politician is a professional panderer like bill neslon in FL. From every welfare handout to Cuban amnesty, Nelson has been there promoting the endless engorgement of gov. spending. To me it is refreshing that possibly this election may actually send the professional politicians home. But my own sense is it is too late.
Why? "The Deficits stupid!" It is now so large it's debt service feeds on itself and no fiscal discipline has been called for. So the giant reserve currency is piling up more debt than any nation in history. We are the largest debtor nation. Even in Vegas they cut off borrowers at some point. But not the US Federal Gov.
Ask the guy in the street if they know how much debt we have now. It is over 13 trillion. We are completely insolvent. However in the past we had enough IRS collections to meet the budget without running out of money. So as you can see, the issue is Gov out of control spending. And under Obama it has gone berserk.
Bush was the first president with a trillion dollar budget, 1.3 trillion. But Obama in his first year chalked up an astonishing 2.8 trillion! That kind of reckless spending has never been done before. And the budget is now growing to 3.5 trillion and IRS can't even collect one trillion in tax.
This is the backdrop to the economy. This is unsustainable. This morning fluff over minutia economic reports is insane. We are on the titanic and we have struck an Ice Berg. The morning futures gets pumped up by some hedge fund owner but it doesn't matter. The debt is sinking the economic ship and the scale of the debt puts the USA alone in the world and we are faltering.
regards
doug
Corporations need to stockpile every dime,
Nassim Nicholas Taleb, the author of the Black Swan has been echoing my thoughts for a long time. Or maybe I could coin my own sound bite... "Its the Debt Stupid!"
I simply can't be bullish on America with a US government that is utterly out of control in terms of debt. The Deficits are now piling up more deficits since IRS collection cannot meet expenditures. Entitlements and War spending have risen to the highest levels in history and these are not World Wars and we are not winning them. In fact, the terrorist are playing rope a dope with us and just like Gen Gyp are going to outlast us.
Our own gov has fought the IMF's attempt to establish European fiscal discipline. The disintegrated Obama economic team has scurried off the decks of the titanic and are gone. The big spenders know the recovery has failed. Their belief in the absolute God of Keynesian deficit spending lacked the austerity that Keynes demanded during good times. The Gov version we have is just borrow and spend more with no concept of the amount of debt which has accumulated.
Obama by himself has caused more deficit spending than all other presidents since Reagan to Washington COMBINED!!!!!!!!!!!!!!!!!!
The Fed has never had more than 500 billion on account. They now have 2.5 trillion! And Goldman and others in Gov want QE II to unleash another 1.5 Trillion.
It is the unforseen consequences of this insanity that makes me a bear. It is incomprehensible the level of debt in America. Over half the homes in America are underwater. We have a full 12 months of homes in default that can't go into foreclosure because the pipeline is already stuffed full of foreclosures.
Then there are no jobs. There is no credit. Americans have the lowest cash reserves in 30 years. Yet nobody in Gov is talking about debt. To the contrary, they are talking about borrowing more and spending more.
The tea party has attached itself to debt but the opponents of Tea party candidates will look at a Mike Castle / professional politician as "experienced" and Christine O'Donnell as inexperienced or stupid. Yet our government was originally composed of lay persons not professional politicians. They governed by common sense which since the advent of professional politicians has all but been forgotten. Instead we have politicians like ben nelson who sells his vote and pitches for buffett exclusion to finance reform laws. It never ends.
The modern professional politician is a professional panderer like bill neslon in FL. From every welfare handout to Cuban amnesty, Nelson has been there promoting the endless engorgement of gov. spending. To me it is refreshing that possibly this election may actually send the professional politicians home. But my own sense is it is too late.
Why? "The Deficits stupid!" It is now so large it's debt service feeds on itself and no fiscal discipline has been called for. So the giant reserve currency is piling up more debt than any nation in history. We are the largest debtor nation. Even in Vegas they cut off borrowers at some point. But not the US Federal Gov.
Ask the guy in the street if they know how much debt we have now. It is over 13 trillion. We are completely insolvent. However in the past we had enough IRS collections to meet the budget without running out of money. So as you can see, the issue is Gov out of control spending. And under Obama it has gone berserk.
Bush was the first president with a trillion dollar budget, 1.3 trillion. But Obama in his first year chalked up an astonishing 2.8 trillion! That kind of reckless spending has never been done before. And the budget is now growing to 3.5 trillion and IRS can't even collect one trillion in tax.
This is the backdrop to the economy. This is unsustainable. This morning fluff over minutia economic reports is insane. We are on the titanic and we have struck an Ice Berg. The morning futures gets pumped up by some hedge fund owner but it doesn't matter. The debt is sinking the economic ship and the scale of the debt puts the USA alone in the world and we are faltering.
regards
doug
Corporations need to stockpile every dime,
