Debt Supernova Gets Worse

Thursday, May 28, 2009 \AM\.\Thu\.

Debt Supernova

I list below posts I have written on this blog about the US debt situation.  As pessimistic as I have been, apparently the debt situation for the nation is appreciably worse than even I thought.  Hattip to Ed Morrissey at Hot Air.  Tax revenues to the IRS are down 44% from where they were last year.  Previous debt projections, as Ed Morrissey points out, were based on the assumption that the loss to GDP this year would be -1.2%.  With GDP contracting at -6% during the first quarter on an annual basis, the economy will have to show a lot of growth for the remainder of the year for the target of a -1.2% GDP contraction to be reached.  I very much doubt if the GDP contraction will be much better than -2.5% and could easily be far worse.

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Chutzpah

Sunday, May 17, 2009 \AM\.\Sun\.

 s-DISASTER-large

Bringing to mind the story Abraham Lincoln used to tell about a young man who killed his father and mother and then begged that the court would have mercy on a poor orphan, President Obama now seeks to pose as a deficit hawk:

President Barack Obama, calling current deficit spending “unsustainable,” warned of skyrocketing interest rates for consumers if the U.S. continues to finance government by borrowing from other countries.

We can’t keep on just borrowing from China,” Obama said at a town-hall meeting in Rio Rancho, New Mexico, outside Albuquerque. “We have to pay interest on that debt, and that means we are mortgaging our children’s future with more and more debt.”

Holders of U.S. debt will eventually “get tired” of buying it, causing interest rates on everything from auto loans to home mortgages to increase, Obama said. “It will have a dampening effect on our economy.”

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National Debt Road Trip

Saturday, May 16, 2009 \AM\.\Sat\.

Hattip to the Cranky Conservative.  My only suggested improvement to this video would be a shot of the debt car hitting a brick wall which will happen, and I am beginning to think sooner rather than later, when the government is simply unable to find lenders willing to risk their funds to cover our national credit card binge of federal spending.


Bye Bye Triple A Rating?

Wednesday, May 13, 2009 \PM\.\Wed\.

Broke Uncle Sam

One of many problems in having a government that is digging the deepest debt hole in history, is that lenders can’t help but take note.  The US has enjoyed a Triple A credit rating since 1917.  It is possible that we may  lose that rating.  Hattip to StreetInsider.com.

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So Obvious, Even The New York Times Notices

Monday, May 4, 2009 \PM\.\Mon\.

red-ink

Hattip to Ed Morrissey at Hot Air.  The New York Times reports that Wall Street is alarmed at the matterhorn of debt the Obama administration is piling up.   The Times notes that 10 year Treasury Notes briefly rose to a yield of 3.17% last week, and the federal deficit is currently running at one-seventh of gross domestic product.  There is no mystery here.  Investors are looking at this debt and beginning to understand two simple facts:  it is never going to be repaid and it is doubtful if long-term politically the US can continue to pay the interest on this debt if it dominates an ever-growing portion of tax receipts.  I have discussed the issue of national debt a few times on this blog, here , here, here, here and  here.  We are pursuing lunatic economic policies and we are heading for economic catastrophe. 

Update: The People’s Republic of China,  i.e. Communist China, sharply curtailed  their US bond purchases in January and February before resuming purchases in March.  I never thought I would live to see the day when “Red” China would be rightfully concerned with the stability of the US economy and the wisdom of purchasing US debt instruments.


Debt Sun

Wednesday, April 22, 2009 \AM\.\Wed\.

 debt-sun

Hattip to Instapundit.  The Heritage Foundation supplied the above graphic which compares Obama budget “cuts” of $100,000,000.00 to the appropriations bill for fiscal 2009 of $410,000,000,000.00, the Bankrupt the Nation Act of 2009, sometimes erronously called the “stimulus” bill, which has a price tag of $787,000,000,000.00 and the estimated bill for fiscal year 2010 of $3,600,000,000,000.00.  How ludicrous is all this?  Ludicrous enough that the Obama supportive Associated Press makes fun of it.  Ludicrous enough that even Paul Krugman is chuckling.

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Obama’s Speech on the Economy

Tuesday, April 14, 2009 \PM\.\Tue\.

President Obama gave a speech today on the economy and the agenda of his Administration and Congress, thus far into his presidency. I personally watched the speech. I have yet to go back and read it. I thought it might generate some good discussion, in collective analysis of the text. In the spirit of Easter, please engage with criticisms of his positions, not of his person or broad generalizations that are not necessary or charitable.

It has now been twelve weeks since my administration began.  And I think even our critics would agree that at the very least, we’ve been busy.  In just under three months, we have responded to an extraordinary set of economic challenges with extraordinary action – action that has been unprecedented in both its scale and its speed.

I know that some have accused us of taking on too much at once.  Others believe we haven’t done enough.  And many Americans are simply wondering how all of our different programs and policies fit together in a single, overarching strategy that will move this economy from recession to recovery and ultimately to prosperity.

So today, I want to step back for a moment and explain our strategy as clearly as I can.  I want to talk about what we’ve done, why we’ve done it, and what we have left to do.  I want to update you on the progress we’ve made, and be honest about the pitfalls that may lie ahead.

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