The Bankruptcy of the United States is Now Certain

[Sol Invictus]

February 4 2010 | The Silver Bear Cafe

It's one of those numbers that's so unbelievable you have to actually think about it for a while... Within the next 12 months, the U.S. Treasury will have to refinance $2 trillion in short-term debt.

And that's not counting any additional deficit spending, which is estimated to be around $1.5 trillion. Put the two numbers together. Then ask yourself, how in the world can the Treasury borrow $3.5 trillion in only one year? That's an amount equal to nearly 30% of our entire GDP. And we're the world's biggest economy. Where will the money come from?

How did we end up with so much short-term debt? Like most entities that have far too much debt - whether subprime borrowers, GM, Fannie, or GE - the U.S. Treasury has tried to minimize its interest burden by borrowing for short durations and then "rolling over" the loans when they come due.

As they say on Wall Street, "a rolling debt collects no moss." What they mean is, as long as you can extend the debt, you have no problem. Unfortunately, that leads folks to take on ever greater amounts of debt... at ever shorter durations... at ever lower interest rates.

Sooner or later, the creditors wake up and ask themselves: What are the chances I will ever actually be repaid? And that's when the trouble starts. Interest rates go up dramatically.

Funding costs soar. The party is over. Bankruptcy is next.

Read More Here

[Northern_Paladin]

It's one of those numbers that's so unbelievable you have to actually think about it for a while... Within the next 12 months, the U.S. Treasury will have to refinance $2 trillion in short-term debt. And that's not counting any additional deficit spending, which is estimated to be around $1.5 trillion. Put the two numbers together. Then ask yourself, how in the world can the Treasury borrow $3.5 trillion in only one year? That's an amount equal to nearly 30% of our entire GDP. And we're the world's biggest economy. Where will the money come from?

http://www.silverbearcafe.com/privat.../bankrupt.html

Have your Guns,Canned Foods, and Precious Metal Stock Piles ready.

[Sol Invictus]

Repost: http://www.theapricity.com/forum/sho...591#post167591

[Loddfafner]

Repost: http://www.theapricity.com/forum/sho...591#post167591

Thank you; threads now merged. I am not so certain about this bankruptcy though, beyond the trivial fact that no system can sustain itself indefinitely.

[poiuytrewq0987]

It's one of those numbers that's so unbelievable you have to actually think about it for a while... Within the next 12 months, the U.S. Treasury will have to refinance $2 trillion in short-term debt. And that's not counting any additional deficit spending, which is estimated to be around $1.5 trillion. Put the two numbers together. Then ask yourself, how in the world can the Treasury borrow $3.5 trillion in only one year? That's an amount equal to nearly 30% of our entire GDP. And we're the world's biggest economy. Where will the money come from?

http://www.silverbearcafe.com/privat.../bankrupt.html

Have your Guns,Canned Foods, and Precious Metal Stock Piles ready.

The USA isn't, the EU is. The GDP is higher in the EU than USA.

[SPQR]

"As they say on Wall Street, "a rolling debt collects no moss." What they mean is, as long as you can extend the debt, you have no problem."

LOL Oh ok, so as long as the Ponzi scheme is in motion all is A.O.K.

[d3cimat3d]

It's because all the money it's wasting in Iraq & Afghanistan. Stupid move.

[SPQR]

It's because all the money it's wasting in Iraq & Afghanistan. Stupid move.

No actually it's because our Government has to borrow money from the Federal Reserve at Interest. In the end this is the real problem.

[MisterJ]

"a rolling debt collects no moss."

Well...

A rolling stone collects no moss.

A rolling loan collects no loss.

[poiuytrewq0987]

No actually it's because our Government has to borrow money from the Federal Reserve at Interest. In the end this is the real problem.

Does the FR even have any monetary reserve or is it just printing money out of thin air?