The US needs a wake-up call to change its attitude regarding unsustainable debt. It is for long too been addicted to 'free' money and this has to end. Markets are ready to acknowledge this.
Gold will be new currency standard in the near future. A new finacial era is about to start.
Our national debt is already 12 trillion. If we keep borrowing money, either way were going to have no way to pay it back. If something drastic doesn't happen in Washington, our nation as a whole is screwed. It seems like very little time is left for our nation. But that's just how I see it
World wide fear and greed will force the US into bankruptcy.
Many, many holes are already in the dam. What will pop the first plug? I don't know but each plug removed multiplies the pressure on the others leading to the big bang.
Dig in or go with the flow.
Do you think we will run out of ink first or paper?
Neither party wants to cut the main sources of the debt which is war, social security, or medicare. The debt isn't just gonna go away, and neither party will cut what is truly needed! I expect once we reach 20 trillion or 22 trillion we will default. We should all prepare for the dooming complete economic collapse let me repeat the debt isn't going anywhere it will continue to climb!
This is not uniquely an American problem. Countries default on their debt when they try to use debt (a.k.a stimulus spending) to cover up their debt. The U.S. constructed a federal reserve system independent of the government, while functioning within the government. Because of this, America can't "balance" its debt obligations; the debt is too massive (over $16 Trillion). The problem is the U.S. government can't necessarily pay things off in increments because it will run out of funds. Once a certain part of the debt is paid, those funds are no longer circulating through the economy. Iceland was a perfect example of how mass government spending resulted in a cataclysm of unprecedented proportions. The difference between Iceland and the U.S. is Iceland was able to overcome their governmental obligations to bail out banks and other major industries. The U.S., on the other hand, maintains its seeming obligations to avoid corporate/banking collapse. There are solutions, but America is not on the right track. This is a real catch-22. The very nature of the situation is preventing the attempted solution.
The U.S. has already defaulted once on the national debt, and the people were punished in the 'bail out.' It will happen again. The banking system is way too corrupt for a full recovery, and not only that, when they were bailed out the first time, they treated the funds like they were 'gifts.' This crisis is long from over, and we only have huge banks to blame for it. It will gradually slip into default over the next 5 years.
Granted, it seems that the debt will continue to rise but the central bank can always inflate the currency. This allows for the depreciation of the value of bonds and in increase in consumer prices. There will never be a point in the immediate future when the U.S will default on its loans because the world depends on its currency. By the time consumer prices rise, the politics will probably change and support a policy that pays off the debt at a reasonable price cutting spending. Also the federal bank, which is controlled by the government, owns about 25-30% of the debt meaning that in the event of a possible default the government can evaporate debt owed to itself.
The US' plan has always been to incur debt to cover the deficit and then slowly pay it off over the years, while slowly incurring more debt in the future. It's the same tactic the Fed and Banks used when they loan each other large amounts of money with little interest. That's not to say that things may come to a head in the future, but in the meantime I don't see a default happening.
I can only say "I don't think so" because evidently some people in government are arguing that we should allow a default. The United States is too much of a pivotal country to be playing fast and loose with its economy, especially given the bad economic state of affairs in other countries. None of this instability and speculation can be good for our country or others. I think our leaders do realize that and I hope that a reasonable plan can be agreed upon.