Fake Money and Fake Debt Make Real Problems
So, unfortunately, this article ends with a bitter insight: Sound economic reasoning will come to the conclusion that the fiat money scheme – represented and upheld by the banking cartel – contributes, and necessarily so, to income and wealth inequality within society.4 It is one source of widening the gap between the rich and the poor. By all standards, fiat money must be considered socially unjust. The same applies to the collusion between central banks and private banks.
So what is to be done? The solution is straightforward: Establish a free market in money, shut down central banks, dismantle the banking cartel. As Murray Rothbard says: “[A]bolish the Federal Reserve System, and return to the gold standard, to a monetary system where a market-produced metal, such as gold, serves as the standard money, and not paper tickets printed by the Federal Reserve.”5 Perhaps the debate about growing inequality helps to rehabilitate our money system — something economic insights have failed to achieve so far.
There also remains what to do with all the debts – public and private – all based on the fiat. The solution there is simple and legal (and as unlikely to occur as the other suggestions): cancel it and then make future usurious machination illegal. Then there’s punishing certain parties for their crimes against humanity and the invisible hand. A problem is that the “debate” about inequality is really no more than socialists screeching for more of the same while real, affected victims stare at screens.
To infinity and beyond!
No one listens. There’s nothing new or unexpected in the report but it is nonetheless alarming.
The report shows:
Lawmakers need to work together to address this bleak fiscal picture now so problems do not compound any further.
Why does anyone even bother with the “lawmakers must act!” bit anymore? They’re not going to do anything other than say they’ll act – as they’ve said for decades now. Big hat, no cattle? Big debt, no Congress.
There are some scary facts hidden in there, along with some boring charts. We’ve covered the “held by the public” obfuscation before. But there is a silver bullet for all of this: total debt absolution. Look for it around the time of the Second Coming.
Boring chart. CBO.
The CBO, even with obscured numbers, sounds a warning bell on US debt load: Roll Call Story, here, in its entirety for ease of access:
Debt as a share of the United States economy is on track to blow through the previous World War II-era record within two decades and keep rising from there, the Congressional Budget Office said in its annual long-term budget report.
Generally assuming no change in current laws, growing budget deficits would push debt held by the public from the current level of 78 percent of the economy to almost 100 percent of gross domestic product by 2028, and to 152 percent of GDP by 2048, according to the agency.
“That amount would be the highest in the nation’s history by far,” said the report, which estimates the growth of spending and revenue over the next three decades as a share of the economy. The current record for debt as a share of GDP was set in 1946 when it hit 106 percent. Debt as a share of the economy is projected to exceed that level in fiscal 2034 under the latest projections, one year earlier than in last year’s long-term budget outlook.
CBO highlighted the role that rising interest costs will have, along with the growth of Social Security and Medicare.
In a statement distributed with the report, CBO Director Keith Hall said that by 2048, “as interest rates rise from their currently low levels and as debt accumulates, the federal government’s net interest costs are projected to more than double as a percentage of GDP and to reach record levels.”
Hall said interest costs would equal spending for Social Security, currently the largest federal program, by 2048.
CBO has long warned that rising debt poses a risk to the economy, and Hall made the point again Tuesday.
“The prospect of large and growing debt poses substantial risks for the nation and presents policymakers with significant challenges,” he said in the statement.
Under current law, revenue is projected to be relatively flat over the next few years in relation to GDP, rise slowly and then jump in 2026 after certain tax cuts expire.
“After 2026, revenues are projected to keep rising in relation to the size of economy — though not to keep pace with spending growth — mostly because of increases in individual income tax receipts,” Hall said.
Compared to last year’s report, CBO’s projections of debt growth are higher through 2041 and lower thereafter. The agency projects debt as a share of GDP would be 3 percentage points lower in 2047 than projected last year. The increase in debt through 2041 stems primarily from the tax overhaul, the two-year budget deal and the fiscal 2018 omnibus spending bill, the CBO said.
If Congress extends the individual tax cuts and several other tax provisions that are set to expire at the end of 2025, as many House Republicans want to do, debt would grow even faster, according to the CBO.
Debt held by the public. What, exactly, does that mean? According to the Treasury, it’s: “The Debt Held by the Public is all federal debt held by individuals, corporations, state or local governments, Federal Reserve Banks, foreign governments, and other entities outside the United States Government less Federal Financing Bank securities.”
A refrain from the don’t-worry-about-it nitwits is that… Hold that a second. One notes, for all the dire and calamitous warning, the CBO reports no numerical dollar figures at all. Allow me to post some:
Gross federal government debt: $21.175+ Trillion (as of right now – the thing grows rapidly) (see: US Debt Clock);
Debt Held By the Public: call it $16 Trillion right now (St. Louis Fed.); and
US GDP (2018 est.): $18.5-ish Trillion (World Bank).
Okay, with that out of the way, a variety of idiots usually shrug their shoulders and murmur something like, “But, we owe it to ourselves. So what?” Rose-colored glasses are useless to the blind. Or the stupid.
One, with math skills not acquired in a Detroit public “school,” will notice that the Gross Debt already exceeds the GDP by 14+%. That’s bad. When, soon, and sooner than 2028, the Public Debt exceeds the GDP, things will be worse. We shall ignore TOTAL debt (all sources), unfunded liabilities, and future derivative betting bailouts as such surpasses the ridiculous for the purely hilarious.
Gross US Debt is a combination of Public Debt and Intragovernmental Debt: $21.175 T – $16.5 T = $4.675 T. Who owes what to whom, now? In a way, with the Intra Debt, we do owe it to ourselves. This assumes “we” own and control the government. “We” do not. But, if we did, or if we pretend we do, then there’s a little truth to it. And a little mystery. If we really owe it to ourselves, then why not cancel and dismiss it? We’d be in the same position, right? And, hey!, if we are the public, and the public holds the rest, then why not get rid of that too?
Because we are not the public. Individuals maybe. But notice that there’s also corporations, foreigners, other entities, and the private Federal Reserve. Therein lies the rub. The Fed is the reason all this debt (by any name) floats around. It’s how they make (a very, very, very good) living, by adding zeros in a computer. This simple trick allows political lowlifes easy money to buy votes and, thus, hold power. They, in turn, are happy to allow the banksters to grift away.
You’re not paying this off as that’s not the purpose. It’s not owed to you and, odds are, a few bonds aside, you don’t own any of it. But you will be on the hook. Some more figures:
Total Debt per person within the US:
Forget it. It’s more than you could pay however you slice it. And it’s meaningless. The point isn’t repayment. The point is enslavement. The entire US economy and most of the world is now absorbed into this system of fake, debt-based funny money. None of it is real, literally just being zeros in computers for me to recycle here. The elites make a profit and hold power based on lies and nothingness. The only thing real about it is the real labor stolen from you to make interest payments for the system.
If you’re an average American worker and taxpayer, then you devote a considerable part of your life and time to paying: taxes, a mortgage, and maybe other debts (car, education, cred cards). All of these payments are for alleged cash which never existed and never will. A grand and sick illusion.
Any money you have left over for living is devalued by the constant inflow of new funny money. See: Gresham’s Law. There’s a reason why the cost of everything keeps going up much faster than any raises you might receive. There’s a reason why people need 30-year mortgages. Why they need 7-year car loans. Why they finance increasingly useless degrees. Prices are artificially inflated.
The taxes pay for, in this order: welfare, warfare, interest on the debts, more welfare, some other BS, and, somewhere waaaay down the line, maybe a little needful governance.
This is a giant ripoff. In an economy based on real money, things would cost less, people would keep more money, and banksters and pols would have to seek honest work. As the whole system is bullshit and not intended to ever be paid off, the answer is simple. All the debt – all of it at all levels – should be repudiated. Cancel it. Heck, make it illegal to issue debt.
The “owe it to ourselves” crowd has no response to the common sense solution except a horrified resort to scare tactics. “That would crash the economy!” Maybe. For a short time. Then it would recover and improve – for real people. But, no, they’d prefer the long, slow bleeding we currently suffer. It kind of reminds me of the house slave reminding the field hands to keep singing. Enslavement with a smile.
If we really owe ourselves anything, then it’s honest reflection and, then, maybe a little righteous anger.
Or cat videos. A new tattoo. Some “reality” TeeVee. Whatever makes you sing happily.
Think this was abolished in 1865? Boondocks/YouTube.
Maybe the new editors at the WSJ can reinstitute some truth controls. There’s a glaring error in this story:
The Social Security program’s costs will exceed its income this year for the first time since 1982, forcing the program to dip into its nearly $3 trillion trust fund to cover benefits.
This is three years sooner than expected a year ago, partly due to lower economic growth projections, according to the latest annual report the trustees of Social Security and Medicare released Tuesday. The program’s income comes from tax revenue and interest from its trust fund.
The trust fund will be depleted in 2034 and Social Security will no longer be able to pay its full scheduled benefits unless Congress takes action to shore up the program’s finances. Without any changes, recipients then would receive only about three-quarters of their scheduled benefits from incoming tax revenues.
The report also said that Medicare’s hospital insurance fund would be depleted in 2026, three years earlier than anticipated in last year’s report. Absent changes, the program then would be able to handle 91% of costs.
The nation’s aging population is boosting the costs of Social Security and Medicare, while revenue gains lag due to slower growth in the economy and the labor force.
Where, exactly, is this $3 Trillion reserve fund, this “lockbox,” located? My guess would be in that D.C. museum with the Constitution, the dinos, and other things that don’t exist.
The “reserves” are but an accounting trick which, simply put, is just more debt for you and your kids to enjoy in the future.
There is probably some hidden truth in the story if one knows what to look for. Those dates in the late 20’s and early 30’s. Something else will probably fail around that time.
All $1.5 Quadrillion of them. An enormous bomb ticking away:
In a sweeping critique of global finance released by the Vatican on Thursday, the Holy See singled out derivatives including credit-default swaps for particular scorn. “A ticking time bomb,” the Vatican called them. The unusual rebuke — derivatives rarely reach the level of religious doctrine — is in keeping with Francis’s skeptical view of unbridled global capitalism.
The unbridled part is certainly correct. But, this is not capitalism – there’s no capital involved. By shady definition, these bombs are literally gambling bets based on the 100% fake “currency” gifted us by the governments and the banksters. Will Dr. Steve Keen please report to Rome?
The concern is legitimate and warranted. The overall gist of the message is that, to honor God, and to be free, there must be a level of morality in the financial systems and the economy in general. All good and well.
An enduring call to acknowledge the human quality of generosity comes from the rule formulated by Jesus in the Gospel, called the golden rule, which invites us to do to others what we would like them to do for us (cf. Mt 7, 12; Lk 6, 31).
12. Economic activity cannot be sustained in the long run where freedom of initiative cannot thrive. It is also obvious today that the freedom enjoyed by the economic stakeholders, if it is understood as absolute in itself, and removed from its intrinsic reference to the true and the good, creates centers of power that incline towards forms of oligarchy and in the end undermine the very efficiency of the economic system.
From this point of view, it is easy to see how, with the growing and all-pervasive control of powerful parties and vast economic-financial networks, those deputed to exercise political power are often disoriented and rendered powerless by supranational agents and by the volatility of the capital they manage. Those entrusted with political authority find it difficult to fulfil to their original vocation as servants of the common good, and are even transformed into ancillary instruments of interests extraneous to the good.
These factors make all the more imperative a renewed alliance between economic and political agents in order to promote everything that serves the complete development of every human person as well as the society at large and unites demands for solidarity with those of subsidiarity.
This seems a little late as the powerful stakeholders and their co-conspirators in the governments have long since abandoned anything approaching decency, morality, or concern for the common good. It’s almost funny: the US had a law banning sports gambling yet has always allowed derivatives betting, which is nothing more than a private-party extension of the crimes of central banking fiat.
So much the Pope gets right:
What was sadly predicted a century ago has now come true today. Capital annuity can trap and supplant the income from work, which is often confined to the margins of the principal interests of the economic system. Consequently, work itself, together with its dignity, is increasingly at risk of losing its value as a “good” for the human person and becoming merely a means of exchange within asymmetrical social relations.
That means, as the wheels of global fake-finance turn, the funny money drowns out the real value of actual capital and labor; real working people are reduced to serfs. Gresham’s Law at insidious work – bad money driving out good. It was directly, correctly predicted 100 years ago, echoed constantly ever since, but it has been an observable trend and phenomenon for millennia.
I was afraid the Letter would degenerate into a call for more central planning and regulation – the same things that created the issue, to begin with. The sell is in there but it is soft. Rather, I was pleased with the conclusion, the call to action of free individuals:
34. In front of the massiveness and pervasiveness of today’s economic-financial systems, we could be tempted to abandon ourselves to cynicism, and to think that with our poor forces we can do very little. In reality, every one of us can do so much, especially if one does not remain alone.
Numerous associations emerging from civil society represent in this sense a reservoir of consciousness, and social responsibility, of which we cannot do without. Today as never before we are all called, as sentinels, to watch over genuine life and to make ourselves catalysts of a new social behavior, shaping our actions to the search for the common good, and establishing it on the sound principles of solidarity and subsidiarity.
Every gesture of our liberty, even if it appears fragile and insignificant, if it is really directed towards the authentic good, rests on Him who is the good Lord of history and becomes part of a buoyancy that exceeds our poor forces, uniting indissolubly all the actions of good will in a web that unites heaven and earth, which is a true instrument of the humanization of each person, and the world as a whole. This is all that we need for living well and for nourishing a hope that may be at the height of our dignity as human persons.
The Church, Mother and Teacher, aware of having received in gift an undeserved deposit, offers to the men and women of all times the resources for a dependable hope. Mary, Mother of God made man for us, may take our hearts in hand and guide them in the wise building of that good that her Son Jesus, through his humanity made new by the Holy Spirit, has come to inaugurate for the salvation of the world.
Know and understand these money troubles. Don’t be alone. Join us in the reservoir of consciousness trending towards freedom.
And, we are not alone. Interestingly, even today, another call was raised about the same subject.
Alieno liberaret servitus!
First, limping along with the news at FP:
And, a welcome of sorts to the wonderful readers over at The Piedmont Chronicles:
A few remain hidden but the YT editor tells me that last one is No. 100. Wow…
Tom Selleck is hawking reverse mortgages, equity loans aimed at seniors. He says older Americans are woefully under-saved (they are) and the solution is a loan on the equity! Why not?! These things have been around a while. And all that while I’ve thought the smelled funny.
Without much research, my gut reaction is that this is a terrible idea. It might be helpful to some at times, but it looks like, feels like the end of the debt-ification game. Literally, the banksters grab up the last of the assets, issuing new debt in its place. Cannot be a good idea for the economy as a whole: ownership only by the financial elite only benefits the financial elite. Beware.
Well, seems as if another Tomahawk Slinging Season is once again upon us (or upon those in Syria). Happy Tomahawk Slinging Season from one taxpayer to many others!
Flying off a ship.
Let’s make a really good excuse,
And hope most of ’em hit.
*(Sung to the tune of Jingle Bells or something).
I still can’t find Syria anywhere on or near a map of the USA. Maybe it’s around Alaska? Or one of the little island protectorates? Yet I can easily divine incompetence most rank on the border between Virginia and Maryland.
Trump said he only signed the recent bloated (partial) budget to get funding for the military. Now he wants other parts rescinded. (Thing called a veto. V-E-T-O). The man also recently said it was time to leave Syria to the Syrians and anyone else foolish enough to there thread. It is. But, somewhere along the way, the pullout and the budget seem to have met. Must have been on the road to Damascus…
And, this being Tomahawk Slinging Season and all, maybe a little more expensive foreign meddling is in order before we mind our own business (if ever that is).
All this craziness ain’t cheap: Return of the Trillion Dollar Deficit (Washington Times).
See also: Tax Plan and More Debt (CNBC).
I detected some fuzzy math in the CNBC piece. If the 2016 GDP was $18.5 Trillion (it was), and the on books federal debt is now $21 Trillion (it is), then in the past year+ we must have increased the GDP enormously to be below 96% currently – so as to make the “dire” predictions for 2028 a plausible reality. My calculator may be acting up.
However the numbers settle, I’m still backing my prediction of $40 Trillion in debt by 2024. I see this as being back on track – to oblivion.
Could be worse. You could be in the bull’s eye this Season. Of course, could be better; you might own Raytheon stock.
Horrible numerical news out of DC. The national debt just hit $21 Trillion.
The national debt exceeded $21 trillion for the first time on Thursday, a little more than six months after it hit first $20 trillion on Sept. 8.
The national debt was $21.031 trillion on Thursday. The government releases total debt figures each business day, but it lags by one day.
Federal borrowing has been on the rise again since February, when Congress passed legislation to suspend the debt ceiling. That move allowed the government to borrow as much as it needs to fund the activities approved by Congress.
I was shocked too. And VERY disappointed. At this rate, the debt bomb will only reach $34 Trillion or so by 2024, far short of my forecast of $40 Trillion. Pathetic. We need a war or a new entitlement or something. And soon. Let’s us try to think of something easy that we can communicate to Congress – slowly and with pictures, of course. Remember, every Trillion printed means Trillions more at the disposal of the Banksters. We need to make them happier.
How about a war to make the world safe for social security? We could start bombing Brazil in an hour or two. That would beat thinking about our own ticking bomb.
An enterprising student-employee at my alma mater faces the state’s wrath. His crime? Dissatisfied with his grade, he merely hacked the professor’s computer and changed it. Forced out of UGA, he now faces EIGHTY! charges – of computer trespass and computer forgery.
These are actual crimes and, if the victim is the government or its agents, then they will be prosecuted.
As with that young Brit who hacked the CIA, there has to be a better “punishment” for this man. How about making him head of the University IT department. Obviously knows what he’s doing.
A far worse pattern of crime is committed daily, hourly by some who have little to no idea what they’re doing. That, or they just don’t give a rat’s behind.
You don’t say? Heck, I’ve tried to ring that one myself a time or two. It’s a little hard since they removed the hammer. Anyway, at least The Hill noticed:
Well, it’s true. Congress is bankrupting the country and robbing future generations of Americans to pay for it. It’s dangerous. A debt crisis, and all the terrible economic effects of that, are looming. Both parties are guilty. Every single congressional leader is to blame.
Okay, so it’s true. But how did it happen, and how are they getting away with it? The events of this week perfectly illustrate how the one-way spending ratchet works, why Congress votes to pass it, and how they’re getting away with it.
The Bipartisan Budget Act is 652 pages long. The bill increases spending by $386 billion over two years and nearly $1.5 trillion over 10 years. It also suspends the debt ceiling until after the next election.
Ah! That cool bipartisanship everyone loves. “Gettin’ the people’s business done!”
My (on books) debt projection of $40 Trillion by 2024 may be a little low.
How did this happen? Well, someone elected these cretins. How do they get away with it? Well, I predict most will be re-elected. It’s kind of like the frozen snake: invite a robber into your home and odds are you’ll be robbed. The people’s business must have something to do with naivete and stupidity. Go ring that bell.
So it goes in America: the grade fixer will go to jail; the monsters who deep-sixed the country will escape with perks and pensions.