U.S. to crash?

[young-gun]

So over the past few years interest rates have been slashed to zero, hundreds of billions if not trillions of dollars have been pumped into the US economy, debt ceiling has been raised a couple of times, and the list of measures taken to prevent total economic collapse goes on and on.

Interest rates are now to be set at their emergency lows for the next 18 months AT LEAST. Despite all their tampering and meddling the US is fighting a losing battle, and their collapse is inevitable IMO. I've read that stimulus runs at about an 8-10 month lag approx. and this would be evident in past instances when the fed has intervened.

Need i not remind everyone that all these fancy tactics are used to create GROWTH, and encourage people to SPEND, and even get investors to throw their money into stocks to lift(or hold steady) a falling(or crashing) market. It would appear that their attempts have simply kept their head above water, as opposed to what it is meant to(or usually) achieves. It doesnt normally take this long to bounce back from down-turns once certain actions are taken.

So is the US going to implode around early to mid 2012? They can't keep up their efforts forever, and if anything remotely negative was to occur all of the sudden, they have absolutely no where to go, they have played all their cards. So I just wanted to get others views on the US and where you might believe they are heading.

Will the bear finally take hold? or will they continue to teeter on the edge for the next few years, waiting for a miracle and somehow pull themselves out of this mess?
I'm hoping for some good arguments for the latter, if there is any.

 

[Eager]

I don't think you will find any! The only arguments, good or otherwise, will consist of peoples opinions, sometimes backed up by *cough* research! Think crystal balls...

My opinion is that the U.S will recover. Given the element of time, sooner or later people will forget that there is or was a problem at all, and life will go on. It is still a huge economy over there and is just going through a bit of a shakeout. Unemployment is only 8.5%, not ideal, but hardly catastrophic. The more people return to work, the more tax the gov't collects and the less it pays out on welfare. And, money will continue to be printed until there is enough of it. Probably!!!!

Betcha can't categorically prove me wrong!

 

[wayneL]

The US will wake up to the fact that its success in the past has been from capitalism, puts its nose to the grindstone and invent their way out of trouble.

If there is any country that can do this, it is the US.

Failing that, it could always start another war.

 

[sptrawler]

I agree with both Eager and young gun, after all it's only money, it not as though it's a finite resource.

 

[tech/a]

There are arguments both for and avaunt littering the net.
If your board just google.

I'm with Wayne
The yanks won't just flush themselves down the economic toilet.
The size of it's economy is staggering even when talking trillions in debt.

 

[Lantern]

Infinite growth on a finite planet

Yeh that will work won't it?

 

[Knobby22]

I agree with Wayne and Tech, The USA will get their act together and get back on top.
They have been mucking it up lately but if the country can act together it will soon recover. Its on the way up at present in my view, just slowly.

One of the laws designed to fatten the top 1% wallets is to get a tax break for offshoring production. A direct negative to creation of jobs within the USA. Someone has to clean up these laws! The big problem the USA has is its socialism for the wealthy. They can look after themselves!

 

[explod]

The fiscal condition of the US is so abysmal that rising longer term interest rates will send the deficit soaring even higher due to the escalation of servicing its gargantuan debt load. While this government-sanctioned mugging of savers and retirees continues, the US gets to borrow its trillions at extremely low rates, rates which otherwise would force a much larger chunk of its revenue to go towards paying higher borrowing costs.

From http://traderdannorcini.blogspot.com/ 31/01/12

Here we can see that the majority of these conditions in the Financial Collapse have already taken place. The only reason why the U.S. banking system is still functioning today is due to the ability of banks to mark to model their assets giving the impression that they are still solvent. Furthermore, the increased guarantee of FDIC deposit accounts to $250,000 as well as a temporary unlimited coverage for noninterest-bearing transaction accounts until Dec 31, 2012 have kept a major bank run on the banking system. These changes of policy have postponed the United States from entering into STAGE 2 or the Commercial Collapse.

from http://www.silverseek.com/article/coming-paradigm-shift-silver

For those who are not aware I shudder

 

[Glen48]

Food stamps usage are up 270% in some states, Shops now open late at night because the money goes in at 4 Am so shoppers arrive early and shoppers and have the cash ready, shops want to stagger the days payment goes in because they can't handle the people and shopper leave trolies full of frozen stuff go to waste because they can't get served.

The shop owners are assisting the fed's with the cost of paying out for the stamps.
Meat can now be purchased at $1 a piece.
House prices are still going down after QE 1 to X
Is the US to crash YES
Big companies are now all over seas and pay less tax if they go back to USA they are taxed again.
Look at Apple a lot of engineers design the I what ever and send it over seas to be produced where does that help USA employment, the real unemployment figures are a lot higher.

The Volt elect car is not selling because the batteries catch fire which tends to slow car sales.

Car sale are worked out on what leaves the factory not sale from the yards because no one is buying thanks cash for clunkers they all got in early
Once China tanks you will get a taste of it in OZ.

 

[Glen48]

FROM SHTF'
As more Americans than ever before join the ranks of the unemployed, and with insurance benefits starting to dry up for many who have exceeded the 99 week maximum, homelessness across the country is quickly becoming an issue that can no longer be glazed over by politicians.

There are over 3.5 million people officially listed as homeless in America, and with tent cities popping up all over the country as a result of foreclosures or inability to pay rent, the trend, like the rising number of food stamp participants (48.5 Million) and those living on the edge of poverty (100 million), is not abating. In fact, as the economic health of the United States further degrades, we can expect to see homelessness rise at a record pace. Most Americans are just a paycheck away from disaster, and once that income stops coming, there is no alternative except to join the millions already living on the streets.

There is, however, some light at the end of the tunnel, at least for those living in Florida, where legislators may have come up with novel solution for sheltering those without homes:

Back in 1988, Florida legislators passed a law that would allow sports stadiums to collect about $2 million per year from the government to build new shiny stadiums that would increase economic investment and improve the quality of life.

Tucked into the statutes is an obscure homeless shelter provision, which has mostly been ignored for 23 years, and could be a $300 million “Oops” for stadiums, arenas and spring training facilities across the state.

The law states that sports teams that accept taxpayer dollars to build facilities must house the homeless on off-nights, and lawmakers have brought it back from the dead in a pair of bills gaining steam this legislative session.

Senate Bill 816, which would make teams and stadium owners return millions of taxpayer dollars if they can’t prove that they’ve been operating as a haven for the homeless on non-event nights, passed its first committee in the Senate on Monday with a unanimous vote.

There was some charged language aimed at taxpayer-supported sports franchises during the hearing:

“We have spent over $300 million supporting teams that can afford to pay a guy $7, $8, $10 million a year to throw a baseball 90 feet. I think they can pay for their own stadium,” said Sen. Michael Bennett, R-Bradenton, who is sponsoring the bill. “I can not believe that we’re going to cut money out of Medicaid and take it away from the homeless and take it away from the poor and impoverished, and we’re continuing to support people who are billionaires.”

Source: Miami Herald

Florida reports that there are over 60,000 people living on the streets or in shelters, not counting an additional 50,000 school-age children who also don’t have homes. While it may not work well for the owners of those stadiums, since the taxpayers are the ones who paid for them it begs to reason that they can decide how to use those facilities in the 270 or so off nights per year. Given their size, it’s reasonable to suggest that the state may be able to fully house, at least for those nights that their home teams aren’t playing, the majority of those who have nowhere to go when the sun goes down.

 

[pilots]

Why the U.S. was downgraded:

* U.S. Tax revenue: $2,170,000,000,000
* Fed budget: $3,820,000,000,000
* New debt: $ 1,650,000,000,000
* National debt: $14,271,000,000,000
* Recent budget cuts: $ 38,500,000,000

Let's now remove 8 zeros and pretend it's a household budget:

* Annual family income: $21,700
* Money the family spent: $38,200
* New debt on the credit card: $16,500
* Outstanding balance on the credit card: $142,710
* Total budget cuts: $385

Got It ?????

OK now Lesson # 2:
Here's another way to look at the Debt Ceiling:

Let's say, You come home from work and find there has been a sewer
backup in your neighborhood....and your home has sewage all the way up
to your ceilings.

What do you think you should do ......

Raise the ceilings, or pump out the ****?

I took this from TS.

 

[Glen48]

Dear Pilots,
Easy answer print some money and pay to raise the ceiling.

Regards

B S Bernanke .

 

[howardbandy]

The US has about 5% of the world's population and is using about 25% of its resources -- a 5:1 ratio. As other countries develop and bid for resources, and as resources become scarce, the price of resources will rise. And as work can be exported to lower wage employees, that sets an upper bound on US wages.

The US is facing higher prices and lower wages until the 5:1 ratio approaches 1:1 -- an 80% drop in standard of living -- with no way to avoid it.

Thanks,
Howard

 

[Tysonboss1]

The US will wake up to the fact that its success in the past has been from capitalism, puts its nose to the grindstone and invent their way out of trouble.

If there is any country that can do this, it is the US.

:

That is the most Bullish comment I have seen from you wayne for a very long time,

I'm Impressed

10 points to you.

 

[Tysonboss1]

The US has about 5% of the world's population and is using about 25% of its resources -- a 5:1 ratio. As other countries develop and bid for resources, and as resources become scarce, the price of resources will rise.

People were worried about the price of lighting a home as Whale oil became scarce, But then Kerosine was invented which was 10 times cheaper and far more abundent, Then a few years later the electric lamp was invented which was 10times cheaper again.

Never discount human's ability to adapt and over come. This society will be producing more goods and services per capita in the future than we ever thought possible.

 

[Boggo]

The reality !

 

[golfmos123]

The reality !

Love the pic Boggo! Nothing like karma. What goes around, comes around.

Personally, I think the US might escape and not quite go down the gurgler as far as people think. I do agree with earlier comments that the US does have a remarkable capacity to innovate and invent things the world wants (and then ship manufacture offshore!).

Time will tell.............

 

[Bill M]

I just saw an interesting 1 hour interview hosted by Bill Moyers. Worth watching if you have the time.

---
Bill Moyers talks with former Citigroup Chairman John Reed and former Senator Byron Dorgan to explore a momentous instance: how the late-90’s merger of Citicorp and Travelers Group – and a friendly Presidential pen ”” brought down the Glass-Steagall Act, a crucial firewall between banks and investment firms which had protected consumers from financial calamity since the aftermath of the Great Depression. In effect, says Moyers, they “put the watchdog to sleep.”

Link to video here:http://billmoyers.com/episode/full-show-how-big-banks-are-rewriting-the-rules-of-our-economy/
---

With all that out in the open, still nothing has changed, unbelievable.

 

[young-gun]

There are arguments both for and avaunt littering the net.
If your board just google.

I'm with Wayne
The yanks won't just flush themselves down the economic toilet.
The size of it's economy is staggering even when talking trillions in debt.

the point i am getting at is that while they are under this current false belief that their economy is recovering, a SUDDEN collapse such as lehmans is something i dont think would be possible to come back from. look at the aftermath of the gfc. you think they are ready for round 2? if it happens its going to blindside them, i just dont think they are ready for it...they simply have no where to go.

i also read(or heard) that US banks have been holding billions and billions of dollars of underwater home loans in the hope that the market would bounce back and they would in-turn decrease their losses if sold at a later date. as we have all seen the market most certainly hasnt bounced back. they have debt maturing this year, and the only way they can pay it is by selling these underwater mortgages. flooding a market with more houses that has already fallen apart is going to amplify everything. perhaps you're right, and they will try and find a way around it, but their sweep under the rug technique is only going to be able to take them so much further.

 

[disarray]

I'll take "corporatist dystopia with oppressive police state" for $100 thanks alex