Deuda USA
Visto en Marc to Market:
Perhaps what many observers will find the most surprising is that the US Treasury urged Chinese officials to reduce their massive reserves ($3 trillion-plus). If China did reduce its reserves, it could mean reducing its Treasury holdings. Apparently, US officials do not mind this as daunting as many observers who frequently fret about the implication of China selling US Treasuries.
In fact, China’s massive holdings of US Treasuries may exacerbate the financial crisis. It removes highly prized collateral from the system. Consider that there is roughly $16 trillion of US sovereign debt. The Federal Reserve itself owns about $1.5 trillion and government agencies (e.g., Social Security) own $4.8 trillion. Foreign central banks own about $5 trillion. This leaves a bit less than $5 trillion of this key collateral in the system.
This also suggests some limit on what some have called QE-infinity. It also underscores why some economists argue that QE needs to be accompanied by an expansion of Treasury supply.
El consumidor se va desapalancando:
However, the bulk of the reduction of mortgage debt may be over.
Non-mortgage debt increased. Auto loans increased by $18 bln in Q3, the sixth consecutive quarterly increase and at $768 bln, it stands a a 2-year high. Student loans increased by $42 bln. While the delinquency rate of mortgages has fell (5.9% from 6.3%), student loans in arrears have increased. Credit card debt rose by $2 bln.
The specific Aha was that these two former Clinton Economists had uncovered, buried in the annual Medicare Trustees Report, that the growth in today’s dollars of future Medicare and Social Security obligations is a whopping $7 trillion annually. What that means is if the US were a public company it would have to report a loss of $7 trillion this year, and that would boost the current budget deficit to $8 trillion. What is more incredible is that total after tax income for all Americans is $6.6 trillion, less than what the government is spending in the real world!
Cox and Archer report the current liability of the federal government is an incredible $87 trillion for Social Security, Medicare and federal employees’ future benefits. That is a third bigger than the entire $63 trillion net worth of the entire US. We owe more than we have and we spend and promise to spend way more than we make.
This year the US government will collect $1.9 trillion in income taxes and spend $2.6 trillion on whatever, resulting in a $700 billion deficit. In addition, while only $600 billion in employment taxes will be collected in 2013, $1 trillion or so will be spent on Medicare, Social Security and government pensions. That’s another $400 billion gap.
And where will the government get the $1.1 trillion to fund that combined deficit? By printing as much paper money as necessary. After all government bonds keep going up in price and down in yield. So why not? What’s the problem with printing money forever?
The true arrogance of the Obama Administration is that it believes that the world will always treat the dollar as being as good as gold. Yes, since World War II the world has relied on the US dollar as the reserve currency. If our government stays as arrogant as it is, at some point soon the Black Swan will fly and the rest of the world will get smart and dump the dollar.
La deuda americana es brutal, tarde o temprano tendrán que meterle mano en serio y eso va a ser muy problemático porque si mete a usa en recesión….. En Europa ya nos iban a llover enanos…
Desde el caribe murciano.
Su idea es devaluar el dolar para que la deuda sea menor y mas facil de pagar, de momento no les esta funcionando.