Often I see individuals in denial about their debts. We’ve also seen countries in denial. But we’ve seen nothing of the magnitude we have in the USA.
Sometime, I don’t know when, but the bond markets will run out of patience with the USA. And when they do, there will be trouble of a size none of us have ever before experienced or frankly could ever contemplate. When it happens, it will make our current economic woes look pitifully small.
The USA government has been spending money it doesn’t have for a good many years now, its central government spending exceeding its tax take by over $1 trillion a year. That’s $1,000,000, 000, 000 extra debt taken on every year. Yes, every year. Most of it is borrowed, some from USA lenders, much from China, Japan and yes, even us (my and your pension fund), it’s even creating some money through its own central bank.
Forget the argument that it’s only a small proportion of GDP (USA GDP is about $15 trillion) because it’s a huge number, owed to people such as us, heaped on top of already huge borrowing (about $15 trillion).
Yet, as I write this, its senate hasn’t passed a budget for 1,000 days. As a reminder of what else has happened in the last 1,00 days, and how long ago some of it seems, here’s a video.
— Paul Brindley (@MidsInsolvency) January 25, 2012
No one over the pond (except Ron Paul) seems to have the courage needed to say enough is enough. They are content to carry on, storing up huge problems for us all some time down the line, when it all must surely come crashing down.
I must congratulate the USA for diverting the attention from itself to the smaller matter of Europe.
What are you doing to ensure the tsunami of USA debt, when it hits, doesn’t effect you as much as the rest of us?