What Happens When The US Debt Reaches Critical Levels? | Business Insider Explains
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- Опубликовано: 21 апр 2024
- The US debt is skyrocketing to unprecedented levels not seen since World War II. Our Investing Correspondent Laila Maidan explains how we got there, and how this looming financial crisis could impact you.
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What Happens When the US Debt Reaches Critical Levels? | Business Insider Explains
Notice how she never said cut spending as an option to get out of this?!
This is why things will never change. The US will default and it will be bad.
That sounds good for the rest of the world.
Hey.. we're amazing Americans we don't stop spending..
Lies again? UDK Module USD SGD
Exactly because she talked about the current amount of debts. To cut public spending is a way to decrease future debts, it won't have an outstanding impact on debts at these moment
@@sandponicsno it’d be terrible for the entire world
I’m not sure why reducing any sort of government spending was not mentioned as a solution
I agree, she also should have mentioned what happens to the dollar after the world stops it as world reserve currency.
yeah like sending money to ukraine and israel to protect blackrocks investments
This! That should be the first option, but she failed to even mention it. I kept waiting for it, but then remembered why I unsubscribed to these fools awhile ago.
Propaganda disguised as information.
The government shouldn't reduce spending. Unlike you and me, it's actually a good thing when the government runs a deficit because their deficit is our surplus. If the government starts running surpluses, that would mean we in the private sector have been pushed into deficit, and thats is a recipe for disaster. This is why every depression in US history has occurred after a period of deficit reduction
I love how they avoid saying cut spending
Cutting spending doesn't necessarily work.
My country had austerity to curb debt, but the debt continued to grow and it resulted in stagnant salaries for the past 15 years and a basically complete economic collapse for anyone not yet a homeowner.
You know it serious when the lego blocks comes out.
I wonder if the new money will be "Lego blocks"?
This reminds me of the jenga blocks in “The big short”.
We just borrowed 61 billion to pay for a futile war in Ukraine that should never have happened.
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The shits already at critical levels.
nothing happens, japan which is one of the world's leading economies is an example of that...
After that yellow dragon fruit
@@trader2137 Japans economy is a disaster though. A perfect example of where we don’t want to be.
@@lukeh3020 We were told if a country has a debt to gdp ratio half as bad as Japans that they would suffer hyperinflation or lose control of their interest rates. None of that happened. So this idea that our debt is at critical levels is nonsense. Granted their economy has been suffering from slow growth, but that's because of their 20% consumption tax and other contractionary fiscal policies.
Been to Japan lately? We should be so lucky as to have a country like theirs.
no more retirement no more social security.. MAYBE THE US SHOULD STOP GIVING OUT BILLIONS TO OTHER countries
the solution so simple yet so complicated , always got money for other countries except for us
partly agree, but it would just go to billionaires and the less rich millionaires. Just ask 45, that was a joke and slap in the middle class's face.
Get some land, build a house and start to grow your own food. There will be more than enough shit flying around to fertilize your plants.
Reverse all the tax cuts the rich have enjoyed over the last 50 years, the US government used to not have to run debt
the social security isn't going to go to 0 suddenly, at worse it's more like the payouts wouldbe 75% what they were.
So like, reduced spending isn’t an option? 🤔
The most obvious option, reducing the government, just isn't on the table apparently. Pretty sure they're intending on sticking *you* with the bill.
@@LyricsQuest Why hurt people by cutting public services when you can just stop selling bonds? There's no rule that says we need to sell bonds and add to the debt every time the government runs a deficit
@@grimaffiliations3671 Tax revenues apparently can't pay for the current budget, so stopping the sell of bonds/debt, would lead to a collapse of spending and cutting of public services by necessity.
@@LyricsQuest Tax revenues don't pay for anything the government does on the federal level. They're debited out of existence. Anything the government needs, it simply creates as it goes. They rolled over 120 trillion dollars worth of debt in 2021 alone. Thats trillion with a T. Besides, neither taxes nor bond sales can finance the government since spending comes before taxing or borrowing
Sure
If u want to have less money in your bank. The spending of a government is the income of the population. So, if the Government goes negative in spending, it will take money out of the system and everyone will have less.
Just blame it on your predecessor and keep elevating spending.
nothing wrong with spending as long as you don't spend beyond your economy's productive capacity
his predecessor was all about spending and rich people tax breaks.
he's spending, for different reasons, but is doing it wrong here too. it's a bad combo these two.
@@w1-em4nq spending on people is much better than spending on tax breaks for rich people
@@grimaffiliations3671you all should actually read multiple news sources.
@@grimaffiliations3671he lowered tax for everyone. Biden is raising it for everyone including you so don’t worry our prices have gone up purposely. Biden is also projected to spend more than trump.
And the people who caused this will finally be gone within 20 years and we will be settled with their children making it worse while everyone else is in misery.
Yeah because no-one will think to do anything in that time...loooool Debt is just a factor in economics it isn't the entire picture
Yea they were spending it on you trying to make your life easier.
Yeah that one's laughable. Run for office and have your slogan be "Save America, raise taxes" and see how many votes you get.
It was a small group with an oversized reach of power that convinced millions of Americans across different generations that very low taxes is good, the govt. is bad, and global warming is fake.
Oh, and they convinced people of other things too such as Democrats stealing babies and such.
@@mosijahi3096 Yes, I'm so glad the 20 years worth of military spending in Iraq and Afghanistan has produced so much value on making my life easier.
@mosijahi3096 can you explain your hypothesis, good sir? I am from Switzerland and I'm very intrigued by this.
"Our debt could balloon to the point of no return..."
I have terrible news for you.
Right? I'm like, "who wants to tell her?"😂😂😂
It can actually get better if only the govt can start making better decisions for the sake of it's citizens, cos' they have really made life more difficult for its residents. This hyperinflation has left the less haves bearing the brunt of the burden. My entire $520k retirement portfolio already took a big hit. Where else can we invest our money FFS
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This video is so simple and concise that all the idiots in our government can understand it! Hope they watch it.
should be "this video is so stupid" and naive, debt(by the government) is nothing but government expenditure on development, the government can pay the debt right now, but that'll lead to hyperinflation, instead the government needs to print money, at a rate, just below the rate of GDP growth, some inflation is good for the economy in the long term, take Japan for example this is the biggest example of a country will the most amount of debt, there it is. this is just a higher level explanation, of course there are more nuances to this
Does not bother them the politicians are getting rich and richer 😂😂😂😂
You are assuming they know how to use a computer...
i thought war is good for the economy?
The mistake is thinking those in government are idiots, just as it's a mistake to think they have the citizen's best interest at heart. They're literally selling out the U.S. and getting richer, but have fooled most of the population into thinking they're blundering about like buffoons.
I like how the answer is always to raise taxes….how about SPENDING LESS OF OUR TAX MONEY??
the government doesn't spend your tax money. Federal taxes are debitted out of existence
Because we need our government, spending less means there might as well not be a government. You want to live like that go to Haiti.
@@ILikeMyPrivacytbt so it’s this size government or Haiti? Don’t be that simple minded.
@@jjwallnutts4341 Okay, what spending do you think we could do without? We need defense with the expansion of authoritarian states and the loss of democratic ones, we need a safety net in times of hardship, we need education and healthcare. What do you think we should give up? Frankly I don't think we spend enough on our education and healthcare, those are things that pay for themselves but are usually the first to go when people cut taxes.
@@ILikeMyPrivacytbt you dont think there is VAST waste in each department you mentioned?? We could cut a millions bureaucratic jobs tomorrow and no one would notice.
"Critical levels" is such a relative term.
The "Military" jar needs to be at least 10 times bigger 🙄
The scary thing is that the the social security and Medicare jar are drastically larger than the military one and it's only going to increase as more boomers hit retirement age.
@@Watcher4187that isn’t true. The military is about 50% of all our government spending
@@Freiheit1232This also isn't true, at least not completely. Our defense budget makes up around 50% of our discretionary spending, but discretionary spending only makes up around 30% of our total budget. The other 70% is mandatory spending which must be paid in full before a single dollar can be spent on discretionary spending. Mandatory spending includes Medicare, Medicaid, Social Security, and payments on the National Debt. Mandatory spending can only be changed by changing the bills that created them in the first place.
@@Freiheit1232 military spending is approximately 15% of the US budget.
@@Freiheit1232 That isn't even close to true. It is about 13%. Transfer payments are like 60%.
Strictly speaking, the government doesn't need to borrow money. It's the issuer of money.
The investor side view of money presented here doesn't do a good job of illuminating why this debt is a problem for the general public.
When the government issues money, it's attached to some payment obligation. Such as a mortgage.
More selling of government debt to investors means more money can be issued in the form of mortgages.
Which inflates the property market, and turns into a system of usury for renters and prospective property owners. (The rates look reasonable, but those property prices somehow seem a little high...)
Does working longer hours under higher debt levels towards more expensive essentials seem like a good economy to you? It's a good economy for investors!
This is more directly the situation you find yourself in when you configure your economy to be GDP optimized.
A certain brand of economist does an amazing job deluding themselves into thinking they're not just telling people to work longer hours.
US government debt-nothing happens, because it’s not really a debt.
Now private debt is what people should be concerned with. When that metric rose to 3 times real GDP in 2008, the financial system collapsed.
survey shows that the average american have trouble udnerstaing basic maths such as compounding, i am not surprised they dont understand how national debt works.
Thank You! im glad im not only one!! There is no debt! they could print out the money n pay it off!🙌But would look bad! Every Country does it! prints alil extra!🙄🤷♂️
system collapsed because FED didnt fix it with printed money. Now they print so its not an issue
Agreed. These investors, which are private or foreign nations, are buying America. The American economy is a freight train. Its not going anywhere anytime soon so the US gov debt is a nothing burger...
If its not a debt what is the actual value?
Since Biden took office, there seem to have been more unfavorable results in America. These results include effects on the markets, such as price declines and sharp increases in inflation, as well as bank failures. I wonder if the sudden increase in interest rates will help value investors or if it would be wiser to stay away from the stock and financial markets for the time being.
I made a video just like this while in high school in 2014 about the national debt. Sad to see nothing has changed, but nice to know the information is mostly the same.
The debt has literally doubled in the ten years since 2014. See? Something has changed after all.
Cut spendong, economy crashes. Raise taxes, economy craxhes. So huge inflation is what we are getting
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The debt began when the US dollar came out of the gold standard. During gold standard the rule is you can only borrow (Print) according to the amount gold reserve the treasury has, anything extra becomes worthless as it does not back by anything. After the gold standard the dollar was priced in commodities like oil, then it became popular through the easy trade system called SWIFT where the fiat currency is not backed by anything than the trust. Now the trust is gone which shows the actual burden of the debt with fiat currency with no trust or gold as its backer.
She a bit 30 years off. Must been bored lol
that explains why we had so many depressions during the gold standard, tying our entire money supply to shiny rocks was a bad idea
When the US dollar came out of the Gold Standard, Americans started spending money like their was no tomorrow, and now there is no tomorrow, and no hope of saving the USA.
@@sandponics spending money is good
so US of A is a 27 trillion dollar in GDP and its debt is 33 trillion dollars. Am I correct?
I can understand that it's scary for a US citizen.
She is referring to the debt hold by public
@@larskaminskidk what's the difference?
and by public you mean the US population and government except the private companies?
Debt hold by public is the total debt minus debt hold by government organisations : Social security, medicaid, medicare ect
@@larskaminskidk So according to you US population holds 33 trillion dollars in debt?
Thank you for this video. I've searched other videos and taken an high school econ class but this really takes the cake for being the most explanatory, just when I had given up on trying to understand.
Should've used a bucket instead of glass to represent military spendings.
Defense spending is less than 15% of the total budget.
…it’s a good thing you can still recognize the helicopters that fly above Max. If the defense budget is dropped further from the 13% it is now, you might not recognize anything that flies in our airspace…
The USA has the largest economy and is the worlds main reserve currency, that's why investors buy bonds. The USA also has a big military, so good luck enforcing legal action or engaging in war against them over debt.
Until the moment the dollar isn't the main reserve currency and a lot of different countries cannot be silenced by military force...
Thank you for this. This video is very informative, extremely easy for anyone to understand and well edited.
The best solution was not mentioned... The government should spend less and spend more efficiently.
For example: So many countries are spending less money (per capita) on healthcare and education, but they have a better system than US.
Don't forget defense. They could cut a lot of spending without reducing readiness by just hiring experts to check what their suppliers are charging. They cut out all the engineers who checked to see if things were good value for money. Now there's a company that does most of the militaries spare parts...bushings worth $500 max were sold to the navy at $100,000. A rubber seal for an apache... $10k. Might be worth $20.
Video didn't talk about SPEND LESS! There no need to print more or tax more if gov actually responsible and cut spending.
This!
theres nothing responsible about austerity. Not only does it hurt people and slow the economy, it doesn't save you money in the long run
@@grimaffiliations3671 you probably need to understand what a true free market is. A propped up one by artificially pumping money in all sectors is why it can't be maintained in the long-run. The longer the spending balloons the more people it will impact and longer the impact.
@@Xyz99899 The governments deficit is our surplus, so if the government balances its budget, that would simply push the private sector into deficit. That's not a good thing for the economy. Government deficits provide the only way for the private sector to net save.
Also, government deficits can be maintained. The fed has full control of interest rates, so they can always put the interest rate below the growth rate of the economy. They could also stop selling bonds and adding to the debt at any time
@@Xyz99899 The free market can't function without the nations currency. The government's deficit is our surplus. If the government runs a surplus, that means its pushing us in the private sector into deficit. Only way for the private sector to net save is for the government to net spend
It’s not from tax cuts. It’s from spending. There’s a point where the government actually takes in less money by increasing taxes.
Balanced Budget Amendment. 38 states need to ratify the amendment. I love how no one ever talks about cutting spending. I could balance that budget in 10 minutes.
This!
Terrible idea. The governments deficit is our surplus. So balancing the budget just means pushing the private sector into deficit. You're basically calling for a depression
When a government has a surplus and no debt and continues to keep taxes low but greater than spending, the surplus keeps growing.
The people, with low taxes, have more purchasing power. That spending helps the economy.
Deficits means borrowing. Borrowed money costs more because of interest. That means more money must be taken from the public to pay back not just the borrowed amount, but the interest.
Everyone knows that if you need $100 and you have $200, you can cover the debt with $100.
But if you have to borrow that $100, it'll cost over $100 to clear.
On the large scale, people go bankrupt, companies go bankrupt, and history shows countries can go bankrupt.
The question is simply when will it happen.
@@frpgplayer This is wrong. the 3 sectors of the economy (private sector, public sector and foreign sector) can't all be in surplus at the same time. The only way for the private sector to run a surplus (which it needs to do to stay out of recession) is to draw that surplus from one of the other sectors. And since it can't draw the surplus from the foreign sector because of our trade deficit, it must draw it from the government. So until we get rid of our trade deficit (which can't happen unless the US loses it's reserve currency status) the private sector will rely on government deficits to stay afloat and calling for a "balanced budget" is basically calling for a recession. This is why every depression in US history came after a period of deficit reduction
And no, more money doesn't need to be taken from the public to pay the interest of the debt. The government pays this interest by rolling over the debt, taxes do not pay for this. The fed rolled over 120 TRILLION dollars worth of debt in 2021 alone. Also, there's no rule that says deficits must equal borrowing. The government could run deficits without selling bonds, since bonds don't finance government spending. Bonds were sold to control the interest rate, not to fund the government. But since 2008, the fed has paid interest directly on reserves, making bond sales (borrowing) no longer necessary.
Countries can indeed go bankrupt, but only if they borrow in someone else's currency. Every country you can name that has ever gone bankrupt in a fiat system did so because they raked up too much foreign currency debt. But you can never go bankrupt in your own currency. Just ask Japan, who are perfectly fine after raking up a debt to gdp ratio of 250%
@@grimaffiliations3671 Socialist thinking type. No, wealth equals to production capacity which leads to greater capacity to buy anything, not from monetary manipulation.
The State isn't the "engine" of the Economy, the private sector is.
Governments don't produce anything, their spending come from reducing the current (taxes) or future (debt + interests) purchasing power of the population/private sector.
The less governments influences the economy, the better it tends to go...political decisions aren't usually logical/rational decisions, they are decisions to privilege certain groups/lobby while the collective result is jeopardized.
nations are sick of imported inflation again and again (because of Over-Printing U$$D), disrupting their economic growth...
while us enjoy their spending spree without feeling guilty/shame for the world...
world-wide de-dollarization is inevitable and imminent, or is it?
---...----
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We need a balanced budget and to amortize the national debt.
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I just have a hunch on how to get out of this. I'm just you know. Thinking out loud, but first things first would be removed. Citizens united thus, corporations can't lobby for political influence next because of that influence loss. The military-industrial complex wouldn't need a little looking at also, I'm a farmer. And we use synthetic nitrogen, which releases so much co 2 into the air.
It literally turns organic matter into co 2 gas. So maybe like changing that for food production. So there are my ideas. We change the political sphere, thus changing the military-industrial complex. If we change our food production, who knows food might be medicine and we might not need so many pharmactutor calls.
Almost like the word pharmacy has the word farm in it.
I made it like 1 minute into the video before I made a comment. Thanks for the vid
If everyone with some land grew their own food, things would improve drastically.
Cut spending, raise corporate tax rates which are at an all time low, raise capital gains taxes, there are many options on the table. They just arent popular because being fiscally responsible isnt popular.
We never recovered from the Great Recession. Quantitative easing that started in 2008 went on until 2022 when the Federal Reserve started raising interest rates and shrinking its balance sheet. Sorry to tell you but we’re just starting to feel the effects of all the money created from debt.
There really is no US Debt....we will just print money and could pay that off!!💯🙌🤷♂️ But they cant just print...would look bad! Every Country does it! Such a scam how they have it setup!🙄But just my 2 cents!👍
Another way to get out of debt is hyper inflation!!!
You mean just like Germany did in the 1920s. Then we had WWII to help fix the problem.
I think the debt problem in the US has reached a state where one should ask - do you need to solve the problem or not. After all, we now live in the world of Modern Monetary Theory, and printing trillions of dollars overnight has proved not to cause massive inflation, because US inflation is always exported to the rest of the World (and right now, China is happy to absorb it all).
The only real problem that could arise is an increasing distaste for the US dollar at a global level. Now once that comes about, there will be no exporting inflation anywhere, and that will definitely end the US
Budgeting basics...
Bring in, more than you put out, to create savings...with savings as a buffer against adversity, you never need to get into debt holes in the first place.
Live within your means.
this video is so naive, debt(by the government) is nothing but government expenditure on development, the government can pay the debt right now, but that'll lead to hyperinflation, instead the government needs to print money, at a rate, just below the rate of GDP growth, some inflation is good for the economy in the long term, take Japan for example this is the biggest example of a country will the most amount of debt, there it is. this is just a higher level explanation, of course there are more nuances to this
Paying debts, reduces the money supply, making new debt increases it. Monetary inflation goes one way and not the other.
@@LyricsQuest No it doesn't. There's no pot of money from which the government must spend it simply creates as much money as it needs as it goes
@@grimaffiliations3671 Check out Fractional Reserve Banking on wiki. "When a loan is made by the commercial bank, the bank creates new demand deposits and the money supply expands by the size of the loan.[4] ", and "Just as taking out a new loan expands the money supply, the repayment of bank loans reduces the money supply.[19]"
@@grimaffiliations3671just to let you know, 1. Bonds are already dead, as you look at the largest buyer of debt is the fed. Meaning the bonds are just going back in to a book. Making more money/gdp meaning more inflation. If other countries were buying it then it would spread the cost else where. 2. More or less money doesn’t matter, what matter is M1. That is the reason why the banks are not allowing any withdrawals, more cash more inflation. But as the debt gets higher, the value of dollar gets less, meaning your money will get less in purchasing power any way it goes. Value vs debt problem. To conclude unless you know a way out your are s up both way and side way, there is no way out.
Nicely explained in simple words
I would argue that the US national debt has already passed the point of no return. Just think about it - the government would have to collect $90K in taxes from EVERY family (including pensioners and the unemployed) to pay off the debt while simultaneously cutting expenditure by 10 - 20% to balance the budget. That's simply not going to happen, so the next option is printing money. Get ready for many years of high inflation.
Buy Gold and Silver. From 2000 it was around 350$/ounce to today at around 2300$ / ounce. This speaks volumes. It's not that gold is getting more expensive it's the dollar losing value relative to gold.
Short anwser : nothing
YUP
113k debt for each citizen of usa.
so? that debt only exists in theory, it will never be paid, it will always be rolled until the end of time
Better than no debt and living in Cambodia lol
@@trader2137what do you mean so? It's a fantasy that it has no consequences.
I'd love to live in your fake world where we can keep running up the debt with no repercussions.
@@wyattgouldthorpe1880 actually youre living in fantasy overthinking about the debt, look at japan, 263% GDP debt, what did that change? people live like they used to and its leading economy...
@@wyattgouldthorpe1880 The fed rolled over 120 trillion dollars worth of debt in 2021 alone. That's trillion with a T. Also we don't have to keep running up the debt, bond sales don't finance government spending. So they could stop selling bonds and adding to the debt at any time
Investing more into Real Estate while Zoning Laws are not dealt with will only serve to make the cost of living crisis worse.
The US will probably need to declare bankruptcy and start over and never allow tax cuts and unbalanced budgets again.
Or option 4. The government can reduce spending and live within its means.
While I don't disagree with her thesis, as she is correct, her video lacks any substantial information. It's puff piece.
Yeah. Japan's national debt is 261% of their GDP - the highest in the world. You don't see them in crisis mode. This report is a joke.
@@Rexvideowow Have you ever heard of the "straw that broke the Camel's back"? Keep increasing debt over time and eventually services will stop or hyper inflation will occur.
@@chuckdawit Sure, but the people who report on US debt being a problem have always had the position that going over 100% GDP is a death sentence. It's clearly not. I'm not saying spend all you want like it's an all-you-can-eat buffet - just that the reporting she's done here is straight up fearmongering. Absolutely no mention of other country's debt for comparison. Any time you withhold information like that, you're selling a lie, plain and simple.
How do you explain Japan's debt which is 3 times US debt ratio to GDP? The Japanese don't seem to be living in poverty.
This is what I was wondering as well. "Critical point of no return" talk without addressing other countries that have already gone FAR past that. This just makes Business Insider look foolish, like they did no research. Either that, or they have been influenced by Republicans who always make US debt a talking point. This makes me take everything else BI says with a grain of salt.
The Japanese have a massive currency problem.
Japan had negative interest rates. Not anymore (2024). Debts aren't only debt, they represent a cost to be paid monthly/annually, and that's what matters for the government finance.
Many Japanese adults live like slaves. Wake up early to catch the train, and then stay at the office for 12 hours. It gives them an hour to drink at a bar after work before riding the train home to go to bed.
The Japanese are generally miserable if they are working fulltime. That is why there is such a huge NEET population in Japan. Things are so dire that many young people would rather just play video games until something major happens.
Adults don't seem to grasp that when they hand their children a sick, perverted, mismanaged society that many of the kids will say "no thanks" and just live as NEETS
Nothing will happen just print more to cover the debts. Especially when you own the printing machine.
I am not an expert but seems to me the real issue is that we only rely on one rate that applies to everyone. We should have instead different tiers of rate for different purposes or social classes. Having only one rate is not the answer in my opinion
A lot of Countries are in trouble, thanks for the insight
everyone not sanctioned into oblivion like russia, NK and iran..
Reforming entitlements where 2/3 of the government’s spending is occurring are off limits.
This is amazing content! Thank you :)
Excellent video, great job!
wow you make things so easy to understand and really put a lot into this video
Thanks for watching!
This video is nuts 🤣 she's calmly saying "abandon ship", "save yourselves" invest in other countries. Yeah, that's surely the way to not accelerate the US crash.
WW3 and our debt is wiped clean like the end of Fight Club
There's a high likelihood that they are planning it. Trump's rhetoric of "Strengthening our military" is an allusion to a somewhat obvious future conflict. Zuckerberg is likely privy to these plans, thus the underground Hawaiian compound.
Why are we still handing billions of dollars each year to nations like Indi @?
When we could take those funds to help fellow Americans.
Laila can talk about to me about investing and money all day long
20 years- go for it- I may have moved by then 😊
expat?
Where will you move?
Good move 😎
@@adrianpjagger Trump shattered the Record with a $8 Trillion Dollar increase in just 4 years ~ He said he would do just the opposite ... Guess he Lied to US...
If the US goes to shits, I’ve got a feeling every other country will also get hit.
Politicians and economists are afraid to use the term any more because it freely admits effectively to the state giving already rich people free money through governmenrt policy, but the ever climbing debt levels still point to the fact that the false narrative of trickle down is alive and well sadly.
I am sure if they didn't limit the amount of bonds one person can have.... the wealthy would invest.
Also have a timeline as in the amount of time they have to hold it before they can sell it back.
Protect for both sides.
😂0:50 she never said anything about %40 of that money going out to Ukraine, Israel and every place else ! What's up with that !?
Thats war spending
Budapest Memorandum that the US signed in 1994, obligates aid to Ukraine and guarantees integrity of Ukraines borders.
Thats what’s up.
@@andreyromashchenko8967 The 94 Budapest Memorandum is a political security assurance from the US/UK and not a legally binding security guarantee.
We are not sending 40% of our annual budget to Ukraine clown show.
@@dmacarthur5356 you are trying to make it sound not serious. Its about nuclear weapons, so it’s as serious as nuclear weapons.
the only thing about our debt is the fact that over half of our debt is owed to ourselves.
problem is you cant afford to pay back the other half.. even if you pay yourself back first.
Even in these freaking videos they underestimate the debt problem. The current debt to Gdp of the US, is NOT 94%, it's at around 134% and the US is already past the point of no return. Annual Interest payments have more than doubled in the last 2 years
the government has full control of interest rates, so the debt is perfectly sustainable. Also, bond sales are not necessary to finance spending. They could stop selling bonds and adding to the debt tomorrow
@@grimaffiliations3671 The government has full control only of short-term interest rates, and can only manipulate long-term interest rates by printing money and buying treasury bonds with it (to surprise their yield), but that will push inflation much higher. And NO, the US government CANNOT stop selling bonds and increase their debt load.
@@grimaffiliations3671 I wouldn't call the inflation we have been dealing with "sustainable", and the inflation is the "hidden tax" associated with this mountain of debt money we have printed. The US govt has a champagne taste on a beer budget and needs to majorly reel itself in or they will kill the goose that lays the golden egg for them (aka the tax payer livestock). They can't get blood out of a turnip at some point!
It's still unclear to me why increased National Debt is really a problem. Seems like it should be, but if everyone is comfortable getting their Bond payments, does it ever really matter if everyone gets paid back?
Inflation. There's no calm expectation to see your money 5% per year while its purchasing power is 10% lower a year....
@drjp4212 okay yeah, that makes sense thanks!
We keep giving countries billions…
Peanuts compared to spendings on the military.
Totally peanuts compared what would happen if the rest of the world would abandon the petrodollar
Here's what you can do directly to lower the debt. Stop voting Republican.
explain?
I get what you mean , its neo cons and cons still very much like the George Bush era disaster
@@hugostiglitz5798 1:13 - 1:44 The wars on terrorism (Republicans and neoliberals), 2008 financial crisis (Republicans and neoliberals), 2017 TCJA (Republicans), COVID-19 (Republicans bungled response which then necessitated spending to bail out the population).
you read the deficit myth by stephanie kelton?
she forgot gold.. it's a definite asset to own.. and taxing us to death.. how do you think that will end? 62% of our pay is already taken frojm us in miscellaneous taxes.. and honestly i'm tired of funding BS that i have no say over.. i am thoroughly disgusted with our country right now.. things NEED to change!
Here’s a news flash, I seriously doubt we have 20 years at the rate we are going. Spending 1 trillion every 100 days and that’s right now. If you know how compound interest works, you should be very worried. Prepare accordingly.
Take away: feel scared?
As long as the rain keeps coming from the sky, we will survive.
FUNDING SCHOOLS? LET ME LAUGH AT THE STUDENT DEBT. NOW LET'S TAKE A LOOK AT THE MILITARY SPENDING... HAHAHAH WTF
military equls your security and security of your children, so its very important
And then look at medicare/medicaid and despair
@@trader2137 But we are the most powerful nation in human history and our geography makes us virtually unconquerable and our military spending far exceeds even China.
@@trader2137 More like the security of US international corporate interests (oil projects, infrastructure projects, corporate farmland all over the world (Think DOLE), US corporate mines,etc). The USA doesn't need 800+ bases around the world to stop the invasion of the USA homeland.
@@trader2137 Unfortunately, we give donations instead of doing proper business-like deals to the countries we spend billions of dollars on. Meanwhile, anytime we need or want support, our allies barely fund a dime. Why is the American public always on the hook? What we don't lose in taxes, we lose in inflation. However, I still agree a good amount military spending is important for our security (it should just be closer to home, i.e. why do we cut our personal missile defense by 1 billion and increase Israel and Ukraine by 70 billion, where is border security?). Unfortunately, we refuse to build even fund basic border protection and pay people to enter our country illegally. We give them $10,000+ dollars in benefits as soon as they get here, hotels, pre-paid visas, etc. Then, they have there basic needs met and some of them move on to stealing the cars of the working class. They also have the added benefit of being basically untraceable, pay no income tax, change there name every time they get caught breaking the law, and so on. We have no idea how many murders have entered, where they are, who they are. Crime has skyrocketed in every single city housing ton's of "migrant" AKA "illegal as hell people". On top of this the people of the city our then getting taxed higher and can't even use their basic public goods the way they were intended. These "migrants" are spitting in the face of Americans, American law, and American money, and we are handing them money and opportunities to abuse us in return. Even when the police is knowing dealing with illegals, there is essentially no concept of deportation anymore, and no consequences, no fines, nothing. There is no justice. We spend zero dollars enforcing the law saying they should not be here or actually show up to a court case. The system is abused and I'm tired of it. I'd rather pay less tax and have less government because they are clearly a bunch of useless overpaid assholes who don't give barely a care in the world about the people they are supposed to serve.
U.S. debt is currently $34 trillion, most of this has little to do with the Pandemic, as debt was already $27 trillion before the Pandemic even started. Ever since Ronaldo Reagan, debt has skyrocketed, he nearly tripled debt from $738 billion to $2.1 Trillion, he was the father of trickle down on economics, his policies nearly tripled debt, and U.S. politicians still believe in the insanity of Trickle down economics and in fighting endless costly wars.
Spend > increase the debt ceiling > borrow more. This is fine.
This video is out of date. The debt is now currently the highest in history..
What is critical levels? Japan has an incredibly high debt to GDP ratio and is being talked about as moving out of its stagnation and is also talking about dumping lots of money into its military because of the threat of China and N. Korea. The US is decades away from the debt Japan has, unless we have another really large tax cut making it incredibly easy for billionaires to become trillionaires. Oh wait, that's already happened. Well, it's not INCREDIBLY easy.
Even without tax cuts, you can elevate debt through increase in spending
Yup, all these doomers need to read The Deficit Myth by stephanie Kelton or watch the new documentary Finding The Money
@@grimaffiliations3671 What if a country runs deficit and the debt is held by external parties?
@@wyw201 As long as the debt is in your own currency, it doesn't matter whether its bought domestically or by external parties, you'll be fine
@@grimaffiliations3671 To be clear, the amount of national debt doesn’t matter. You can issue debt from 0 to infinity as long as the debt is in local currency? This principle also applies to all countries in the world.
It is already passed the point of no return. It's just people playing with numbers and giving them more value than needed.
It will never get fixed.
The "printing more money" is likely where it'll eventually end up - despite its negative implications.
Keep funding other countries with military aid lmao
military aid is a drop in the sea of the US spending, and its necessary to keep the western alliance healthy, its better to send money now than your children to a war in 10 years... ignorant.
better to send money than your children in 10 years... also most of the money stays within USA and gives thousands of job places....
What happens? They print banknotes, stupid.
💲= fiat currency
@@peekaboopeekaboo1165 so?
@@grimaffiliations3671
Facade
So it'll be the second option: Print -> Inflation which shrinks the debt, produces 'growth'...
"how can we prepare for this scenario? Well, you can invest in real estate". Me (looking at my tiny savings while I suffer under constantly rising inflation and seeing house prices double every 4 years) - Oh, right. Just buy a house..... How simple. aka, just stop being poor!
Answer: WW3😂
The answer is very obvious from the video. Raise taxes.
you're putting the cart before the horse. we have to cut spending first.
Tax revenues are at record highs, and continue to be every year.
@@wmercer7234You have to do them at the same time.
Not simply rising taxes, but also taxing and spending smarter.
that is exactly the conclusion they WANT you to come to. not the solution that benefits the citizens the most.
The bit about more debt --> more bonds issued --> borrowers get cold feet and want higher yield --> private sources like mortgages and car loans have to jack up their rates to get money....
that bubble is quite nuanced though
easy to understand and clearly described. Great
Meanwhile US giving billions of dollars to Ukraine 😂
Yes, and foreign aid of ANY kind is taxation without representation!!!
@@JohnDoeTheTroll u elected the people voting for it
@@grimaffiliations3671 I'll be sure and not vote for those who allowed this then.
@@JohnDoeTheTroll allowed what? paying us defense contractors?
@@grimaffiliations3671 Is that where you really think that money goes? LOL
Bitcoin fixes this
Uhuh
Especially since the Halving a few days ago, when the inflation rate of Bitcoin became around 0.8% which is now even lower than gold. Currencies like the USD can't possibly compete. What happens next is inevitable. Study Bitcoin.
Nothing happens. Just print more money
US can always print money. It will always be able to pay its debts. But the price of debt in this case is inflation, and everyone is feeling it.
A recession will cure this problem really quick! Only requires Biden to taken his hand off the money printer. 😂😂
Facts
The central banks are beyond POTUS and there are no printers since the 80's as institutions simply manifest "money" into existence.
Darn right. Trump and Biden have printed 8-10 TRILLION in stimulus since 2020. Fantastic!
i love it when a huge recession hits right when i start adulthood, ruining my entire life.
it's mathematically impossible to avoid recession if the govenrment balances it's budget, so balancing the budget is bad