Tag: debt

Authored by Nouriel Roubini via Project Syndicate,

In my 2010 book, Crisis Economics, I defined financial crises not as the “black swan” events that Nassim Nicholas Taleb described in his eponymous bestseller, but as “white swans.”

According to Taleb, black swans are events that emerge unpredictably, like a tornado, from a fat-tailed statistical distribution.

But I argued that financial crises, at least, are more like hurricanes: they are the predictable result of built-up economic and financial vulnerabilities and policy mistakes.

Continue reading “Dr.Doom On Gold & ‘The White Swans Of 2020’”

Guest Post by The Zman

A good rule that no one anywhere follows, is to contemplate the consequences of being wrong before doing something. For example, if legislatures had to post a wrongness analysis for every bill before they could be voted on, at least some of the terrible ideas would get stopped before becoming law. Of course, that is probably why such a thing can never happen, at least in a democracy. New ideas are about hope and nothing is worse than dashing the reformer’s hope for the future.

Even so, thinking about wrongness has its utility. For example, many people on the Right still cling to the idea that government cannot keep borrowing money. Going back to the 1980’s, perhaps even further, conservatives have been predicting that there is some limit to government debt. Ronald Reagan ran on this idea in 1980, when the Federal debt stood at $900 billion. Forty years later and the debt is $23 trillion, a number so large no one can imagine it.

Continue reading “What If You’re Wrong”

Via ZeroHedge

According to a new report from Truth in Accounting, the most-indebted states include New Jersey, Illinois, Connecticut, Massachusetts, Hawaii, Delaware, Kentucky, California, and New York.

Truth in Accounting published the Financial State of the States report, a regional analysis of the most recent state government financial data, on Tuesday, that is one of the most comprehensive studies of the economic conditions of all 50 states. The report includes the most up-to-date state finance and pension data, trends across the states, and key findings.

Continue reading “Debt Bombs: Here Are The States With The Most Debt”

“Innovators and creative geniuses cannot be reared in schools. They are the men who defy what the school has taught them.”

Ludwig von Mises

“You can either be informed and your own rulers, or you can be ignorant and have someone else, who is not ignorant, rule over you.”

Julian Assange

“Free people, remember this maxim: we may acquire liberty, but it is never recovered if it is once lost.”

Jean-Jacques Rousseau

“The missing step in the standard Keynesian theory [is] the explicit consideration of capitalist finance within a cyclical and speculative context. As recovery approaches full employment…soothsayers will proclaim that the business cycle has been banished [and] debts can be taken on. But in truth neither the boom, nor the debt deflation…and certainly not a recovery can go on forever. Each state nurtures forces that lead to its own destruction.”

Hyman Minsky

Authored by Lance Roberts via RealInvestmentAdvice.com,

The $70 Trillion Dollar Graveyard

On Thursday, Congress passed the spending bill we discussed last week:

“A divided House on Thursday passed a two-year budget deal that would raise spending by hundreds of billions of dollars over existing caps and allow the Government to keep borrowing to cover its debts, amid grumbling from fiscal conservatives over the measure’s effect on the federal deficit.

65 Republicans joined the Democratic majority in the 284-149 vote, with 132 Republicans voting against the bill, despite President Trump’s endorsement and pressure from key outside groups, including the Chamber of Commerce, to avoid a potentially catastrophic default on the Government’s debt.” 

I highlighted the last sentence in red because it is an outright “LIE” used to convince Americans that out of control spending must be done. 

The reality is that “interest payments on the debt” are part of the MANDATORY spending in our budget along with social security, medicare, etc. Currently, about $0.75 of every dollar of tax revenue goes to mandatory spending. For the last few months the Government has been at its statutory debt limit, and “surprise” we didn’t default on our debt. Why? Because there is enough revenue currently coming in to cover the mandatory spending.

Continue reading “Whistling Past The $70 Trillion Debt Graveyard”