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Strange Famous Forum > Social stuff. Political stuff. KNOWMORE

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3flip



Joined: 30 Dec 2003
Posts: 2201
Location: Minneapolis
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A default IS coming. It's happening through a devaluation of the dollar. The crisis is coming and it is going to be much worse when our money is worthless and nobody around the world wants it.
Post Thu Aug 04, 2011 11:27 am
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Mark in Minnesota



Joined: 02 Jan 2004
Posts: 2019
Location: Saint Louis Park, MN
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The Treasury has been selling inflation-adjusted instruments for years now. Not everything they sell has those properties but it's how we've been able to keep borrowing in dollar-denominated assets into the quantitative easing headwinds. It's also how we'll be able to keep borrowing if the dollar ceases to be the world's reserve currency.

Most of our entitlement obligations, particularly Social Security, Medicare, and (IIRC) means-testing for Medicaid are also inflation-adjusted.

Hyperinflation, if it happens, would be catastrophic for our economy and our standard of living, but it wouldn't result in an implicit default on the majority of our fiscal obligations.

The strength of the dollar isn't the only thing that gives us borrowing power--our government's ability to tax the real GDP (viz., industrial output) of the nation is what gives us borrowing power. The only way we default (as Iceland essentially did) is when we actually really can no longer tax enough to cover our obligations, either due to extreme contraction of real GDP or due to a failure of political will.

This will still be a pretty big economy even with a weak dollar.
Post Thu Aug 04, 2011 12:47 pm
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jakethesnake
guy who cried about wrestling being real


Joined: 03 Feb 2006
Posts: 6311
Location: airstrip one
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If we default and the dollar deflates, I think it might possibly be the best thing that could possibly happen for the economy. Imagine the amount of goods we could sell if shit was 1/2 the price for everyone else? Third world countries be gobblin up iPads like whoa. You think Apple has more money than the US government now? Of course, then we wouldn't be the $uperpower of everything anymore...

http://en.wikipedia.org/wiki/Economy_of_Iceland

http://www.oecd.org/document/16/0,3746,en_2649_34569_43946384_1_1_1_1,00.html

Imagine Iceland, except instead of "small and volatile" economy, it would be "massive and stable". Surplus, balanced budget, etc. etc.
Post Thu Aug 04, 2011 5:20 pm
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futuristxen



Joined: 01 Jul 2002
Posts: 19373
Location: Tighten Your Bible Belt
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Mark in Minnesota wrote:


The specific example you're citing shows that what you're proposing to do in the ballot box will be ineffectual at best, and downright destructive to your own political interests at worst. What you should be doing if you want to have the same substantive effect from the left that the Tea Party Caucus had from the right in this Congress is backing a Democratic representative who will join the Congressional Progressive Caucus. On balance, that group is a lot more on your side than Obama has been.


The republicans had to go into the wilderrness to be beaten into staying true to their core messages. The tea party is a part of that. The democrats getting wiped out in the next election would probably be a good thing for a liberal voice in government, as counter-intuitive as that is.

One step back, two steps forward kinda thing.

I'm not voting for Democrats out of fear of republicans ever again.
Post Thu Aug 04, 2011 5:44 pm
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futuristxen



Joined: 01 Jul 2002
Posts: 19373
Location: Tighten Your Bible Belt
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tommi teardrop wrote:
I start to wonder if it just boils down to Republicans being better politicians than Democrats. It's like Democrats want to be all courteous. You look back at how Bush was able to do everything that he wanted. And with Obama, they won't let him do anything without getting something they want. They are so much better at negotiations.

It sort of upsets me that all of the 3rd party steam that was building in the early 2000s was killed by democrats that blamed Nader voters for getting Bush reelected. Even here on the forum, voting 3rd party was seen as a vote for the Republicans. The embryos and shambahlas of the world beat us over the head with that shit.

We looked at Bush and a possible McCain as the end of the world and we compromised our ideas in order to get a democrat in office. And then the Republicans still run shit.

The separation between red and blue feels greater than it ever has. I'm sort of at a loss. Maybe it's time to just drop out.


I think this is about where everyone is after this last four years.

Obama promised Hope and Change. But he delivered demoralization and more of the same.

Never believe in anyone that requires millions and millions of dollars from corporations and elites to get to power.
Post Thu Aug 04, 2011 5:47 pm
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tommi teardrop



Joined: 12 Apr 2007
Posts: 2216
Location: Las Vegas
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The failed opportunity of having our own version of Sarah Palin or Michelle Bachman in Ralph Nader. Having someone whose threat to run 3rd party could convince the Democratic Party to move further to the left.

It feels like we missed out on a huge opportunity just because we feared Republicans so much. The blame is all over the place. If only we could have realised that Republicans only pose a threat if Democrats in congress allow them to do whatever they want. Otherwise they would be just as ineffective as Obama has been. At least Republicans have leaders that fight (or appear to fight) for the bullshit they advocate.

I almost feel ashamed of myself for voting democrat at this point. The health care compromise. Continuing these wars. Renewing the tax cuts.

"The only true aging is the erosion of one's ideals."

Most of us showed our age over the last 12 years. Afraid of being grouped with libertarians or conspiracy theorists. So we just bought into the democratic party bullshit. smh.
Post Thu Aug 04, 2011 6:37 pm
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jakethesnake
guy who cried about wrestling being real


Joined: 03 Feb 2006
Posts: 6311
Location: airstrip one
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Fuck that bullshit, I wanted Dennis Kucinich. I will sing that proudly. I don't care what party he was from. The rest of NH wanted Clinton. At this point, I'm thinking even that would have been better. Blame Oprah for this mess.
Post Thu Aug 04, 2011 6:47 pm
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futuristxen



Joined: 01 Jul 2002
Posts: 19373
Location: Tighten Your Bible Belt
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tommi teardrop wrote:
The failed opportunity of having our own version of Sarah Palin or Michelle Bachman in Ralph Nader. Having someone whose threat to run 3rd party could convince the Democratic Party to move further to the left.

It feels like we missed out on a huge opportunity just because we feared Republicans so much. The blame is all over the place. If only we could have realised that Republicans only pose a threat if Democrats in congress allow them to do whatever they want. Otherwise they would be just as ineffective as Obama has been. At least Republicans have leaders that fight (or appear to fight) for the bullshit they advocate.

I almost feel ashamed of myself for voting democrat at this point. The health care compromise. Continuing these wars. Renewing the tax cuts.

"The only true aging is the erosion of one's ideals."

Most of us showed our age over the last 12 years. Afraid of being grouped with libertarians or conspiracy theorists. So we just bought into the democratic party bullshit. smh.


Oh oh don't forget, we're still torturing the fuck out of people in bizarre legal netherworlds. AND under Obama we've introduced the world to robot warfare.

Oh those halcyon days of elections past. We thought we'd have it all. Single payer healthcare(never even on the table!!), end to torture, repeal of the defense of marriage act, redistribution of wealth...the roads would be smoother, the trains would run faster--hi speed wi fi for all.

The secret to all of these political fucks is pretty simple. None of them are really that ideological, or they wouldn't be where they are. You don't get into an elected seat in the federal government without learning how to slippity slide around anything like beliefs. There's too much corporate money involved in the races.

All these guys care about is power. And if the wind is blowing one way one time, they're liberal, if it's the other they're conservative. And the only wind that's ever blowing anymore is the farts out the top 3 percent of this country, in our general direction.

The political system isn't liberal/conservative. It's rich and poor. And poor is getting it's ass handed to us.

Back during the last turn of the century, they had anarchists and communists and wizards pitched in arch warfare with the upper class--ended up getting the new deal out of it. This century, we're too demoralized. Sunken City like what!
Post Thu Aug 04, 2011 7:37 pm
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futuristxen



Joined: 01 Jul 2002
Posts: 19373
Location: Tighten Your Bible Belt
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jakethesnake wrote:
Fuck that bullshit, I wanted Dennis Kucinich. I will sing that proudly. I don't care what party he was from. The rest of NH wanted Clinton. At this point, I'm thinking even that would have been better. Blame Oprah for this mess.


Even Kucinich is mostly niche marketing himself to the granola--greene set so he can get his name up in lights. I don't know that in a presidential campaign at the bitter end, if he wouldn't just turn out to be another Obama or Clinton.

I think the system is designed that way.
Post Thu Aug 04, 2011 7:39 pm
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Plum Puddin'



Joined: 26 May 2008
Posts: 1829
Location: Run Ebola, Run.
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Post Thu Aug 04, 2011 7:45 pm
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Mark in Minnesota



Joined: 02 Jan 2004
Posts: 2019
Location: Saint Louis Park, MN
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Matt Taibbi has a pretty long section of The Great Derangement devoted to discussing how many swing voters are swing voters because they're morons. I think the same is probably true of any American who compares major elected officials from either party to Hitler or the Nazis.

I've never trusted Kucinich. I like most of his politics but every photo I've ever seen of him with his wife has seemed like clear evidence that he's in league with the lizard people.
Post Fri Aug 05, 2011 9:25 am
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Asterax



Joined: 21 Nov 2002
Posts: 1883
Location: Maine
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Wow.

ABC News wrote:
A government official tells ABC News that the federal government is expecting and preparing for bond rating agency Standard & Poorís to downgrade the rating of US debt from its current AAA value.

Official reasons given, he official says, will be the political confusion surrounding the process of raising the debt ceiling, and lack of confidence that the political system will be able to agree to more deficit reduction. A source says Republicans saying that they refuse to accept any tax increases as part of a larger deal will be part of the reason cited.

The official was unsure if the bond rating would be AA+ or AA.

Another government official confirms the Obama administration is preparing for the downgrade but is not 100% positive itís going to happen, and if it does happen officials are not sure when it will happen.

Before ratings agencies issue a downgrade, there is often some back and forth that goes on behind the scenes. Treasury Department officials have been making the case for months that S&P should not downgrade US debt.


http://blogs.abcnews.com/politicalpunch/2011/08/govt-official-us-expecting-sp-downgrade.html?ncid=edlinkusaolp00000008

This is something to be potentially angry about because of the Tea Party and is a direct result of the 2010 midterm elections which brought these idiots into Congress.
Post Fri Aug 05, 2011 4:35 pm
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mancabbage



Joined: 29 Jun 2005
Posts: 9263
Location: london
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http://www.reuters.com/article/2011/08/06/us-usa-debt-downgrade-idUSTRE7746VF20110806

ouch
Post Fri Aug 05, 2011 7:22 pm
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breakreep
homophobic yet curious


Joined: 27 Sep 2004
Posts: 6627
Location: Fifth Jerusalem
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Man, the Tea Party sure does know how to run a government into the ground. I wonder what their average Congressman's driving record is like?
Post Fri Aug 05, 2011 8:03 pm
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3flip



Joined: 30 Dec 2003
Posts: 2201
Location: Minneapolis
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I think its noteworthy to point out that a third ($300 billion of $900 billion) of the debt ceiling increase has already been spent.

everyone is pointing fingers at the tea partiers as if they caused this downgrade which was downright inevitable. What's the root reason we have been downgraded? maybe because we have 14 trillion dollars in debt? If we think about this type of spending for any other type of institution other than government it becomes much clearer how illogical it is to keep digging the hole deeper to try and solve the problem. As an individual with massive amounts of credit card debt trying to reverse the problem would the wise decision be to spend more and even increase the amount of debt you are able to fall into? Profligate spending will note cease magically if it is allowed to continue. People are upset because we are fucked either way and they don't realize it. The real question is is it better to deal with the consequences now or more drastic ones later.

Not to say there aren't ways to go about things in a manageable, sensible manner. Spending does need to quit growing, and at such a massive pace. Is that an outrageous statement? How about cutting our military spending in half? This is an idea neither side is willing to consider. There were no real cuts in the deal. They were cuts from projected future spending. We are on the path to be spending more annually than our GDP(which is questionable as a real gauge of our productivity to begin with). That simply doesn't work and there is no way that it can. The short term solution is to print money and it will and already has begun to lead to massive inflation. The results are devastating in a recession/depression. Next four years are going to be tough no matter what we do at this point.
Post Sat Aug 06, 2011 8:53 am
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