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US national debt reaches a record $37T, the Treasury Department reports

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Re: US national debt reaches a record $37T, the Treasury Department reports

#151

Post by rsynnott »

jbm wrote: post #84
OgsyedIE wrote: post #25

Earlier quoted context omitted.

He's said on Fox Business today that on the basis of whatever agreements have been made in Alaska the US now considers the public and private holdings of its European allies + Japan to be part of an American sovereign wealth fund that can be expropriated whenever some cash is needed. Either he's lying about that or he has guaranteed a position as Trump's number one favourite after Lighthizer.

I do not know why you are being downvoted as this is something I heard too and is quite serious. > Other countries, in essence, are providing us with a sovereign wealth fund,” he told commentator Larry Kudlow, himself a top economic adviser in the first Trump term. “We have these agreements in place where the Japanese, the Koreans and to some extent the Europeans will invest in companies and industries that we direct…

Yeah, but this is just nonsense, though. Like, this isn't how any of this works.

> the Europeans will invest in companies and industries that we direct them, largely at the president’s discretion.

The only significant general-purpose sovereign wealth funds in the EU are a French one worth 30bn and an Irish one worth $16bn. And the EU, which is the entity which makes trade deals, has no control over those. The EU has no significant money of its own (~200bn budget/year) and has no ability to control what member states spend their money on, and member states in general are uninterested in sovereign wealth funds, nevermind ones which invest specifically in American assets.

As far as I can see, what the 'deal' actually says is that private companies will invest an extra $600bn in the US by 2028, with the EU admitting it has no actual control over this, because of course it doesn't. But this is, y'know, not out of line with the level of FDI that you'd expect anyway, so really that bit of the trade deal boils down to _nothing_, an acknowledgement of what will probably happen in the normal course of events, a completely meaningless promise given for PR reasons.

In general, most of the non-tariff component of these ‘deals’ is of that form; stuff which the government obviously can’t control but which the private sector might reasonably be expected to do anyway.

Re: US national debt reaches a record $37T, the Treasury Department reports

#152

Post by gman83 »

starchild3001 wrote: post #58

At this rate, the debt ceiling’s going to need its own space program! Thank you, Mr. T, and to all those before you who let avoidable crises happen, handed out tax cuts to your richest friends, and slapped it all on the national credit card. The people of this country will be feeling your “generosity” and recklessness for decades to come. PS: I'd invite everyone to examine how US Debt/GDP grew unbounded. The biggest…

The next major "avoidable, man-made" crisis is the slow-motion implosion of the property insurance market due to climate risk.

We're already seeing insurers flee entire states like California and Florida. The domino effect is simple: no insurance means no mortgage, and no mortgage means the underlying asset is functionally worthless to anyone but a cash buyer. This isn't just a problem for individual homeowners; it's a systemic threat. Trillions of dollars in real estate collateralizing mortgage-backed securities are sitting in these increasingly uninsurable zones. It's the 2008 playbook, but the risk isn't a bad loan—it's the physical asset itself.

Re: US national debt reaches a record $37T, the Treasury Department reports

#153

Post by bearl »

hypeatei wrote: post #147
jeff_carr wrote: post #137

Earlier quoted context omitted.

Ridiculous claim. Both parties are exactly the same on this issue. It's politics and nothing more. No one has any idea what to do about it. Well, mathematicians do, but nobody listens to us.

Constantly posting "both sides!!" lacks nuance and is unhelpful. The last budget surplus was under Bill Clinton, a Democrat. Generally, Democrats have to fix the fallout of Republican fiscal policy and get blamed for it since the effects can start to show years later (like Trumps tax cuts)

Chris Hitchens used to like to remind people that Clinton was actually a conservative whose political success was due largely to the longevity of the appeal of the “southern democrat” to certain segments of society. His granting of MFN trade status to China is relevant to “his” budget surplus, as is the fact that the internet happened and the unipolar moment began while he was president. Clinton didn’t invent the internet himself; Al Gore did. He didn’t bring down the Berlin Wall either.

What did Clinton do? Clinton did save us all from “Welfare Queens”, which also seems very relevant here: https://en.m.wikipedia.org/wiki/Personal_Responsibility_and_...

Re: US national debt reaches a record $37T, the Treasury Department reports

#154

Post by AnimalMuppet »

cosmicgadget wrote: post #119
AnimalMuppet wrote: post #104

Earlier quoted context omitted.

One campaigned on reducing the deficit; one did not. It seems reasonable to expect a smaller deficit from the one who campaigned on that, doesn't it?

Unless he has a track record of promising things and not delivering. Perhaps even on this specific issue.

Woah, all the replies are misreading me in the same way.

Yes, Trump seems to lie even more than a normal politician. In that sense, sure, you shouldn't expect that he's going to do anything about the deficit. You knew (or should have known) that when you voted.

But what I meant was, because he ran on the issue, we have grounds to judge him for not doing what he said, in a way that we would not have been able to judge Harris had she won.

Re: US national debt reaches a record $37T, the Treasury Department reports

#155

Post by theoreticalmal »

AndrewDucker wrote: post #140
jeff_carr wrote: post #137

Earlier quoted context omitted.

Ridiculous claim. Both parties are exactly the same on this issue. It's politics and nothing more. No one has any idea what to do about it. Well, mathematicians do, but nobody listens to us.

If they're the same, then why does the deficit direction look very different for each of them? https://ic.pics.livejournal.com/dbroussa/553166/241096/origi...

What does that graph look like in the last decade? Surely Covid times show a big blue spike?

Re: US national debt reaches a record $37T, the Treasury Department reports

#156

Post by dkiebd »

ponector wrote: post #139
epolanski wrote: post #35

Earlier quoted context omitted.

> Including healthcare and financial services in GDP figures feels out of place and unproductive You reminded me of something: a nurse in San Diego sleeping through her entire shift is more productive than half a dozen nurses in many third world countries working hard, because the way economists measure productivity is the $/hour output. People doing nothing in America are much more productive than people doing a lot…

Taxi driver in USA is 5 times more productive than taxi driver in Indonesia!

Unironically. His passengers will produce more money working and/or spend more money buying. The taxi driver is a direct enabler of all of this.

Re: US national debt reaches a record $37T, the Treasury Department reports

#157

Post by mensetmanusman »

gman83 wrote: post #152
starchild3001 wrote: post #58

At this rate, the debt ceiling’s going to need its own space program! Thank you, Mr. T, and to all those before you who let avoidable crises happen, handed out tax cuts to your richest friends, and slapped it all on the national credit card. The people of this country will be feeling your “generosity” and recklessness for decades to come. PS: I'd invite everyone to examine how US Debt/GDP grew unbounded. The biggest…

The next major "avoidable, man-made" crisis is the slow-motion implosion of the property insurance market due to climate risk. We're already seeing insurers flee entire states like California and Florida. The domino effect is simple: no insurance means no mortgage, and no mortgage means the underlying asset is functionally worthless to anyone but a cash buyer. This isn't just a problem for individual homeowners; it's…

This is also due to the manmade real estate crisis, housing should be cheap, not the “main” investment, we should have a normal rebuilding effort like in Japan.

Re: US national debt reaches a record $37T, the Treasury Department reports

#158

Post by alexb_ »

mensetmanusman wrote: post #157
gman83 wrote: post #152

Earlier quoted context omitted.

The next major "avoidable, man-made" crisis is the slow-motion implosion of the property insurance market due to climate risk. We're already seeing insurers flee entire states like California and Florida. The domino effect is simple: no insurance means no mortgage, and no mortgage means the underlying asset is functionally worthless to anyone but a cash buyer. This isn't just a problem for individual homeowners; it's…

This is also due to the manmade real estate crisis, housing should be cheap, not the “main” investment, we should have a normal rebuilding effort like in Japan.

Land tax fixes this

Re: US national debt reaches a record $37T, the Treasury Department reports

#160

Post by 2OEH8eoCRo0 »

stephen_g wrote: post #90
trealira wrote: post #53

Earlier quoted context omitted.

2 years ago, Wharton predicted that the U.S. debt would be defaulted on in twenty years [0]. > Under current policy, the United States has about 20 years for corrective action after which no amount of future tax increases or spending cuts could avoid the government defaulting on its debt whether explicitly or implicitly (i.e., debt monetization producing significant inflation). Unlike technical defaults where payment…

Why would a currency issuer make the decision to default on bonds it's issued, when it can always issue new bonds and roll them over, or if it wanted to the Fed can always just buy the bonds back? Don't think of the US (or any monetarily sovereign Government) as having the constraints of a household or business... It's fundamentally different and we make major errors (like the crazy idea the US would default) when we…

Didn't NYC have a crisis in 1975 where the banks didn't want to buy their bonds anymore?
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