More than 20% unemployment, people fighting over bags of free oranges, no heat, no medicine; Greece is having a modern day depression. Although Barron’s magazine put our becoming Greece more than 10 years away, is it really? It seems to me were only several years behind Greece, if that.
We have 100 million people dependent on our insolvent government, which only stays afloat because the Federal Reserve is loaning the criminals in Washington $1.1 trillion dollars every year. We’ve gone from the richest nation on earth to the greatest debtor nation ever. It’s not going to end well, and we don’t want to be Greece (it’s going to be worse). Forward!
The not Photoshopped Barron’s cover:
BARRON’S BLASTS OBAMA: ‘Follow Me, We Can Be Like Greece‘
Barron’s goes there. (Economics editor Gene Epstein is not President Obama’s biggest fan.) Here’s the lede from the latest cover story:
In his State of the Union speech last Tuesday, President Obama concluded that “the State of our Union is stronger.” The big question is: stronger than what?
Federal debt is a record $16.4 trillion, or 103% of the nation’s annual output of goods and services. While that’s still well below Greece’s 153%, we’re headed steadily in the wrong direction.
According to estimates by the Congressional Budget Office, adjusted by Barron’s to account for recent tax increases and other factors, if the U.S. doesn’t raise taxes further and cut spending dramatically, the national debt could easily reach 153% of economic output by 2025.
These are not just numbers. If the U.S. national debt continues ballooning, we can be sure of a deep, long-lasting recession — very likely a depression — sometime in the next two to three decades. The unemployment rate could easily surge to 20%.
Steve Hogan says:
Thinking our day of reckoning is 2-3 decades off is probably wishful thinking. Greece went from being able to easily service their debt to asking for bailouts in a matter of a year. All it took was spike in interest rates.
Our day of 10+% interest rates is coming soon, particularly since many of our foreign lenders are themselves broke. How else to induce someone to lend to a bankrupt institution?
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17th February 2013 at 7:54 pm
AWD says:
Good point, SH
At current levels of Federal spending/borrowing:
In two years our debt will be $18.8 trillion
In ten years our debt will be $27.5 trillion
In twenty five years our debt will be $43.9 trillion
Somehow, I don’t think we’ll make it 25 more years (or ten more years).
Also of note:
two years of spending on the FSA is $2.1 trillion
10 years of FSA spending: $12 trillion
25 years of FSA spending: $27.5 trillion
(on top of the $17 trillion in FSA spending so far)
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17th February 2013 at 8:22 pm
Makati1 says:
Then there is the war we are stirring up here at home. Or was it in Asia? Or Africa? Or..?
Well there will be one when we need it to distract the sheeple and need something to blame the ‘austerity’ on. Wait and see. Either way, the US is headed for the toilet and China is waiting to pull the handle.
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17th February 2013 at 8:46 pm
sangell says:
The ominous trend shows that we could be Greece already. We are running fiscal deficits ( stimulus) of 7% of GDP and generating ‘growth’ of 2%. That is an inverse Keynesian ‘multiplier’. We have to wonder just how far and fast GDP would collapse in the US were we forced to rein in that fiscal deficit as Greece has had to do. When the only thing that keeps this Potemkin economy is running up debt faster than GDP growth how long before the wheels come off and we find out?
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17th February 2013 at 9:03 pm
chen says:
a strong government oppresses the people, a scared government puts up a smoke screen of data. when push comes to shove it will kick out newly printed greenbacks. then you will know the whole thing is on autopilot headed for the cataracts.
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17th February 2013 at 12:47 am
flash says:
AWD- We have 100 million people dependent on our insolvent government,
Does this number include subsidized global corporations,most of which would not exist without the Federal protection racket keeping ‘em propped and popped.
FACEBOOK GETS MULTIBILLION-DOLLAR TAX BREAK…
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17th February 2013 at 8:33 am
ThePessimisticChemist says:
China is doing a fair job of hiding just how shitty things are going for them Makati. I’m not sure how war will start, but I sincerely doubt it will be a direct confrontation between the world’s two greatest superpowers.
We’ll probably butt heads in the Middle-East, but I doubt it will be much more than that.
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17th February 2013 at 9:13 am
AWD says:
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17th February 2013 at 9:50 am