Seems like the growing deficit doesn't even phase anyone?

[smartinvestor30]

Isn't anyone else concerned? It's as if people give up, or don't even bother in the first place, trying to "fix" things. Instead they just focus on how to profit from it.

http://images.moneyandmarkets.com/1218/deficit2.gif

The Congressional Budget Office (CBO) estimates that …

* The 2009 federal deficit will be $1.186 trillion! Even after adjusting for inflation, that’s more than the combined cost of the Vietnam War ($698 billion) and the Korean War ($454 billion) … 4.6 times more than the entire S&L bailout of the 1980s … and 5.5 times larger than the Louisiana Purchase:

* In sheer dollars, the 2009 federal deficit will shatter every record deficit of every nation in history.

* Even in proportion to the larger U.S. economy, the 2009 deficit will represent 8.6% of GDP — more than four times the average under Bush, nearly seven times the average under Clinton, and 1.4 times the post-World War II record of 6% under Reagan.

* After you factor in the additional deficit spending and tax cuts proposed in the Obama stimulus package, the deficit will surge to 10% of GDP.

* Federal spending will reach 25% of GDP — the highest level in American history outside of World War II. But during World War II, most of the money was spent on war-related production, creating entire new industries and keeping millions of Americans in uniform or on the job. In contrast, most of the 2009 deficit spending will be for corporate bailouts, unemployment benefits, Social Security and Medicare.

* Already, in the first quarter of fiscal 2009, the federal deficit has ballooned to $485 billion, an unprecedented increase of 353% compared to the previous year. If it continues to grow at that pace, it will make all the above estimates look small by comparison.

[useless]

I think people are used to the term, they hear it every 2 years and the number doesnt mean anything to them. I think there is also a "only concerned with myself" attitude. Doesnt sound like it is going to go down any time soon either.

[statepkt]

I think a lot people are more concerned for the short term of not losing their jobs, and basically surviving to feed their families.

[freakscene]

Isn't anyone else concerned?

Yes. Very. Although I have been hedging against this by purchasing small quantities of gold and silver every month over the last 20 years.

In contrast, most of the 2009 deficit spending will be for corporate bailouts, unemployment benefits, Social Security and Medicare.


In other words spending not authorized in the constitution.

My advice. Support Ron Paul, and try like hell to not be a lemming who is easily manipulated by the slick marketing of the incoming administration.

[useless]

I do not want to delve into a political discussion, but people like Ron Paul will never achieve office as there are too many voters that are realizing the dream of government subsidy currently. Whether the spending is constitutional or not, I doubt you will get much, if any, argument here.

I think this is why many people are considering other ways to invest; hard assets. This can only go on for so long.

[cramerica1972]

Yes. Very. Although I have been hedging against this by purchasing small quantities of gold and silver every month over the last 20 years.



In other words spending not authorized in the constitution.

My advice. Support Ron Paul, and try like hell to not be a lemming who is easily manipulated by the slick marketing of the incoming administration.
what about the slick marketing of the bush jaunta?

[smartinvestor30]

Yes. Very. Although I have been hedging against this by purchasing small quantities of gold and silver every month over the last 20 years.



In other words spending not authorized in the constitution.

My advice. Support Ron Paul, and try like hell to not be a lemming who is easily manipulated by the slick marketing of the incoming administration.

I did support him, but they got their puppet in place, nothing we can do now expect watch the same mistakes being made that Hoover and FDR did.

[madcowdisease]

Sure it bothers me but outside of a bloody revolution I don't know what any of us can do. Besides, when you lose your job - which may be happening in my household very soon - you tend to not give a shi'ite about macro phenomena such as a national debt

[yanksrule80]

Can't worry about it to much when you know there is nothing you can do personally.

[smartinvestor30]

Sure it bothers me but outside of a bloody revolution I don't know what any of us can do. Besides, when you lose your job - which may be happening in my household very soon - you tend to not give a shi'ite about macro phenomena such as a national debt

Muslim sect :mrgreen::mrgreen: LOL


I can see your point, but everyone should have already begun to set aside some food in case things get bad.

It's different trying to plan what to do when you are sitting in a lavish oval office with Secret Service security vs being at "ground zero". A lot of people give Barrack Obama "shi'ite" (LOL) and say he's an elitiest and out-of-touch. I disagree I think he's one of the most down-to-earth guys that's taken the presidency in a long time.

[madcowdisease]

Muslim sect :mrgreen::mrgreen: LOL


I can see your point, but everyone should have already begun to set aside some food in case things get bad.

It's different trying to plan what to do when you are sitting in a lavish oval office with Secret Service security vs being at "ground zero". A lot of people give Barrack Obama "shi'ite" (LOL) and say he's an elitiest and out-of-touch. I disagree I think he's one of the most down-to-earth guys that's taken the presidency in a long time.

We're in accord on this opinion of Barack. However, that is not saying much relatively speaking. The United States government has long been composed of and favored the elite. With all of the connections and money required to obtain office the plebes don't stand a chance. A government of, for, and by the people is a crock. I write my Congressman and Senators monthly. Occasionally I'll get an email saying thanks for writing if I get anything at all. My Congressman has called a few times. But my concerns are never really addressed. They vote how they want to and I'm convinced special interests have their ear -- not me.

That's why I say anything short of a bloody revolution will exact the change we truely need in this country. Go read Thomas Jefferson and see how far off base we are. All of this shi'ite about deficit spending and getting involved in other countries foreign affairs was remonstrated against in Jefferson's writings. However, as a country we did not heed his warnings and now find ourselves up shi'ite creek without a paddle.

[freakscene]

That's why I say anything short of a bloody revolution will exact the change we truely need in this country. Go read Thomas Jefferson and see how far off base we are.

Perhaps we can thank those who voted for obama for something after all. he may end up being the catalyst that causes the revolution with his insanely socialist policies.

its being predicted by fairly reputable people.

http://www.prisonplanet.com/2009-heralds-a-new-age-of-rebellion.html

He’s not alone in his foreboding prediction. Trends forecaster Gerald Celente has echoed similar sentiments, predicting revolution in America, food riots and tax rebellions - all within four years. Celente says that by 2012 America will become an undeveloped nation, that there will be a revolution marked by food riots, squatter rebellions, tax revolts and job marches, and that holidays will be more about obtaining food, not gifts.


"The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants."
-- Thomas Jefferson


long overdue.

Nouriel Roubini's predictions are no less comforting

[concrete]

Perhaps we can thank those who voted for obama for something after all. he may end up being the catalyst that causes the revolution with his insanely socialist policies.


The so-called "conservatives" are still whining about how Barack Obama is a "socialist" ... and what exactly might this "socialist" do, anyway? Nationalize the banking system? The housing market? The auto companies? What then? Bush & Co. got there already. First with the worst. The only thing they have left is the terrifying spectre of universal health coverage, I guess. God forbid that should happen. Right. Because that might help someone other than Wall Street fat cats. Must prevent that at all costs.

[freakscene]

The so-called "conservatives" are still whining about how Barack Obama is a "socialist" ...

i wouldnt call it whining.

id call it being factual.

hears to hoping its quick and painless........................

[freakscene]

dang typos :p

[cramerica1972]

there is socialism embedded in all parts of american society,take ur partisan blinders off.

[smartinvestor30]

Perhaps we can thank those who voted for obama for something after all. he may end up being the catalyst that causes the revolution with his insanely socialist policies.

its being predicted by fairly reputable people.

http://www.prisonplanet.com/2009-heralds-a-new-age-of-rebellion.html




"The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants."
-- Thomas Jefferson


long overdue.

Nouriel Roubini's predictions are no less comforting


On the note of socialism I would just like to make this point and it's hard to make these type of desicions so I'm not sure what's right or wrong but:

you hear this obama sound byte they've been running on tv

"the question is should we only reward wealth with more wealth, or should we also reward the people who produce all the wealth"

Your comments on this...

[Blood De]

The only thing I can figure out about this reliance on government spending is that possibly the spending stays in America and gets recirculated here better.

Let's face it, if you give Americans $1000 right now it's probably going to Walmart and directly over to China.

[smartinvestor30]

The only thing I can figure out about this reliance on government spending is that possibly the spending stays in America and gets recirculated here better.

Let's face it, if you give Americans $1000 right now it's probably going to Walmart and directly over to China.

Protectionism will actually ruin things further than they already are. Think about it.

[Blood De]

Protectionism will actually ruin things further than they already are. Think about it.

Ya I'm not for it, I'm just trying to figure out what they're thinking which is probably a mistake on my part. I'd at least like to have an idea of what their argument is.

I saw Chuck Schumer saying yesterday that government spending is the fastest way (as opposed to the best way) to get money into the economy. I feel like I can mathematically prove that's wrong.

[aiki14]

I saw Chuck Schumer saying yesterday that government spending is the fastest way (as opposed to the best way) to get money into the economy. I feel like I can mathematically prove that's wrong.

I'd be interested in seeing you do that.
The economy relies on a certain level of inflation to continue growing, in a deflationary environment the best and fastest way to turn that around is to issue currency, thereby inputting an inflationary stimulus. The depression was exacerbated by anti-inflationary policies in a deflationary environment, we dare not repeat the same mistakes because the idea of "government spending" is anathema to our thinking. When the gov't uses new money to buy securities or equity in american companies it isn't coming out of your pocket until the level of inflation increases, and that isn't occurring yet.
I hear complaints about the gov't printing money and how bad it is, but the cost of goods is going down, how then is ones wealth being degraded by the infusion of the currency? And if this infused currency is bailing out domestic entities and propping up the value of their debt or equity then the shareholders are also maintaining value.

[freakscene]

I hear complaints about the gov't printing money and how bad it is, but the cost of goods is going down, how then is ones wealth being degraded by the infusion of the currency? .


include food and energy into the equation and see what the real rate of inflation is

i read somewhere over the weekend, that if inflation today was calculated like it was during Jimmy Carters administration, the number would be close to 11%

[freakscene]

On the note of socialism I would just like to make this point and it's hard to make these type of desicions so I'm not sure what's right or wrong but:

you hear this obama sound byte they've been running on tv

"the question is should we only reward wealth with more wealth, or should we also reward the people who produce all the wealth"

Your comments on this...


I've searched for the quote, but can not find it.

Id rather not comment that much on it until then.

obama and socialists dont understand wealth creation, by definition of their policies.

[smartinvestor30]

I've searched for the quote, but can not find it.

Id rather not comment that much on it until then.

obama and socialists dont understand wealth creation, by definition of their policies.

They must have ran that commercial a million times on inauguration day

I Don't know if I got the words perfectly right.

[smartinvestor30]

I'd be interested in seeing you do that.
The economy relies on a certain level of inflation to continue growing, in a deflationary environment the best and fastest way to turn that around is to issue currency, thereby inputting an inflationary stimulus. The depression was exacerbated by anti-inflationary policies in a deflationary environment, we dare not repeat the same mistakes because the idea of "government spending" is anathema to our thinking. When the gov't uses new money to buy securities or equity in american companies it isn't coming out of your pocket until the level of inflation increases, and that isn't occurring yet.
I hear complaints about the gov't printing money and how bad it is, but the cost of goods is going down, how then is ones wealth being degraded by the infusion of the currency? And if this infused currency is bailing out domestic entities and propping up the value of their debt or equity then the shareholders are also maintaining value.

Do you disagree that the end result of all this will be that we run the risk of entering a period of hyper-inflation?

Do you trust that the FED will raise rates to counter act this?

[aiki14]

Do you disagree that the end result of all this will be that we run the risk of entering a period of hyper-inflation?

Do you trust that the FED will raise rates to counter act this?

No, I don't disagree, but a prolonged period of guaranteed deflation is upon us, I think it prudent to fight the battle at hand and then move to the next battle.
To reply to freaks earlier post, I think the raw numbers including food and energy are worse currently than the core CPI or PPI. Right now energy is pretty cheap and skews the numbers down and the transport costs for food reflect this as well.

I don't trust the FOMC to be anything but behind the curve, overly biased toward inflation fighting.

[smartinvestor30]

No, I don't disagree, but a prolonged period of guaranteed deflation is upon us, I think it prudent to fight the battle at hand and then move to the next battle.
To reply to freaks earlier post, I think the raw numbers including food and energy are worse currently than the core CPI or PPI. Right now energy is pretty cheap and skews the numbers down and the transport costs for food reflect this as well.

I don't trust the FOMC to be anything but behind the curve, overly biased toward inflation fighting.

Why do people (especially on tv) speak of deflation as the a horrible thing? As if it were a plague that we must stop from spreading; and the only way to do it is to have government intervene and save us all from falling prices.

There is a myth that people don't buy things because they will get cheaper, but if you look at the price of electronics, cell phones, and many other things, the prices have come down and it hasn't stopped people from buying.

God forbid that people ever have an increase in the purchasing power of their money, that their hard work, stored in money, shall ever become more valuable. Instead they have fooled people into believe that their hard work should continue to be devalued at a rate much higher than the reported CPI. We all know the true inflation is higher than reported because core inflation as measured in the CPI does not include Food and Fuel.

You might argue that it's because food and fuel prices fluctuate too much. That maybe true, so they should include CPI WITH food and fuel as a end-of-year figure to circumvent this problem of unstable prices in those two categories.

[aiki14]

Why do people (especially on tv) speak of deflation as the a horrible thing? As if it were a plague that we must stop from spreading; and the only way to do it is to have government intervene and save us all from falling prices.

There is a myth that people don't buy things because they will get cheaper, but if you look at the price of electronics, cell phones, and many other things, the prices have come down and it hasn't stopped people from buying.

God forbid that people ever have an increase in the purchasing power of their money, that their hard work, stored in money, shall ever become more valuable. Instead they have fooled people into believe that their hard work should continue to be devalued at a rate much higher than the reported CPI. We all know the true inflation is higher than reported because core inflation as measured in the CPI does not include Food and Fuel.

You might argue that it's because food and fuel prices fluctuate too much. That maybe true, so they should include CPI WITH food and fuel as a end-of-year figure to circumvent this problem of unstable prices in those two categories.

Deflation is a problem because the producers can't make a profit, because of margin shrinkage. It results in layoffs and dropping of stock prices, amongst other things. The market counts on a certain amount of growth, which doesn't happen in deflationary environments.

[Horace Kent]

Why do people (especially on tv) speak of deflation as the a horrible thing? As if it were a plague that we must stop from spreading; and the only way to do it is to have government intervene and save us all from falling prices.

There is a myth that people don't buy things because they will get cheaper, but if you look at the price of electronics, cell phones, and many other things, the prices have come down and it hasn't stopped people from buying.

God forbid that people ever have an increase in the purchasing power of their money, that their hard work, stored in money, shall ever become more valuable. Instead they have fooled people into believe that their hard work should continue to be devalued at a rate much higher than the reported CPI. We all know the true inflation is higher than reported because core inflation as measured in the CPI does not include Food and Fuel.

You might argue that it's because food and fuel prices fluctuate too much. That maybe true, so they should include CPI WITH food and fuel as a end-of-year figure to circumvent this problem of unstable prices in those two categories.

Deflation is an inward shift in aggregate demand. So, less is produced, less is invested, and less are employed.

[useless]

Interesting point, but it seems like we were due for some deflation; esp concerning property