What was bit more interesting recently, perhaps even sinister and perhaps a prelude of things to come, was the auction of US govt bonds where there was a very poor takeup.
Isn't it true though that when the stockmarket is ticking along nicely, people tend to steer away from bonds? Couldn't that simply be the case, or is it not that simple?
Rex Nutting talks about personal and private debt falling.....sounds like great news ....eh?
Until you see the US debt clock and you notice.. yes that personal debt is definitely falling and the GNP is rising...great news!! ....but... the US national debt (15.77 Trillion) is also rising at a faster rate???.......damm .. thats not in the good news script.
Interesting to see from the debt clock that rising student debt has overtaken the falling credit card debt...Hmmmm
It's simply a misconception.that the US could ever be in a borrowing crisis - they just spend money into existence at their will - the only downside to this is inflationary pressure - not a problem at present
Kind Regards
Bernanke confuses growth with inflation. Rising stock markets and house prices aren't real growth. When the cost of living goes up as well savers and people on fixed income will suffer.
The US needs inflation to cope with the massive govt debt. Massive debt yet neither presidential candidate can discuss cutting back military spending as the paranoid population of America feel that there is a muslim or chinese invasion fleet ready to take over the US of A at the first mention of spending cuts for the military. Or maybe because manufacturing weapons is one industry the US hasn't exported to china. If I wasn't living in a country dominated by white people who speak english and have some ties to christianity America would be the scariest country on the planet.
QE3 $40 billion more a month. I guess the heading on this thread is wrong. No borrowing crisis in the US the federal reserve will buy $40 billion worth of bonds every month as required. Someone in the US can borrow as much as they like for next to no cost(interest rate). I wish I had access to it. Maybe I could offer AARON bonds if Ben can't get enough.
Already 2 trillion for qe1 and qe2. Assuming USA population is 350million that is $5,700 per person(every man, woman and child in the US) before qe3 starts. qe3 is an extra $114 per person every month. Who is getting all this money and at what point do you lose faith in the strength of the US dollar. If enough people lose faith all at once then it becomes paper in your pocket and numbers on a screen but worthless. It is backed by the promise of the US govt which has run up so much debt it can't repay it unless it inflates it away by printing more money. I can't help but think that there is something unforeseen just around the corner. To me it seems ludicrous but I am not very intelligent so I must be missing something. Go Helicopter Ben.
I just find these QE1, QE2, and finally QE3 very amusing. Isn't it wonderful that government can print away their debts? BTW, do you know who are actually holding the mortgage-back securities that Ben is going to buy?
Apparently the banks that own the fed will sell it their mortgage backed securities getting rid of more bad debt at par according to the smh this morning. The Fed will never have a cash crisis as it can print more. I have been waiting for the next big crash but inflation will keep prices up. Also what do the banks do with their new money. They are supposed to be onlending it to encourage growth but what about if they are buying other currencies such as the $NZ waiting for the $US to **** itself. They can buy up assets around the globe. What a scam. Not just NZers but people around the globe should be really hack off by the Feds actions. Time to get out of dollars and into hard assets. Damn missed the Akld property mini boom and share prices going gangbusters. What about gold Skol?
...I can't help but think that there is something unforeseen just around the corner. To me it seems ludicrous -????- so I must be missing something. Go Helicopter Ben.
...the consequences are not as unforseen as you think. At some stage in the future, the economy will collapse, as all discretionary spending in the US (and elsewhere) will be used up as interest payments, e.g.if Uncle Ben succeeds with his strategies
US faces borrowing crisis
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Originally Posted by belgarion
.. thats not in the good news script.
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