The so-called “trustees” of the social security system issued their annual report last week and the stenographers of the financial press dutifully reported that the day of reckoning when the trust funds run dry has been put off another year - until 2034. So take a breath and kick the can. That’s five Presidential elections away!
...Except that is not what the report really says.
US global superiority in military affairs is actually the superiority of a rich kid who thinks he’s really smart but in reality is merely just rich. When the seemingly endless flow of money slows (as it inevitably will), the mask of cleverness will fall. Everyone who resented the kid will be waiting at the edge of the playground for this day of reckoning, and because no one else will have been so dependent on spending-as-strategy, the erstwhile rich kid will find it tough going.
When we discuss an "economic collapse," most people think of a collapse of the financial markets; and without a doubt, one is coming very shortly. But let us not neglect the long-term economic collapse that is already happening all around us. If you stand back and take a broader view of things, what has been happening to the U.S. economy truly is quite shocking. The following are 12 ways that the U.S. economy is already in worse shape than it was during the depths of the last recession...
There has been so much attention on Greece in recent weeks, but the truth is that Greece represents only a very tiny fraction of an unprecedented global debt bomb which threatens to explode at any moment. The only “solution” under our current system is to kick the can down the road for as long as we can until this colossal debt pyramid finally collapses in upon itself.
Something's profoundly wrong with our global financial system. Pope Francis is only the latest to raise the alarm...What the Pope calls “an economy of exclusion and inequality, where money rules” is widely evident. What is not so clear is how we got into this situation, and what to do about it.
What Assets Did Greece Just Hand Over To Europe: "Airports, Airplanes, Infrastructure And Most Certainly Banks"Submitted by Tyler Durden on 07/13/2015 22:45 -0400
The Simpsons was right all along...
The one undeniable truth about the debt drama in Greece is that each of the conventional narratives - financial, political and historical - has some claim of legitimacy. These facts matter not only because contagion from Greek debt defaults may ripple in dangerous ways through the financial system, but because they are also true for many other members of the Eurozone. The Euro is a fatally-flawed monetary concept and what we now seeing playing out was eminently predictable from the start.
'Greek' Finance In America: Pensions, Medicaid, & Entitlements Will Bankrupt State And Local GovernmentsSubmitted by Tyler Durden on 07/12/2015 15:50 -0400
If you can't print money or slash expenses, you have to borrow more money. That's the template not just for Greece, but for many state and local governments in the U.S who share key characteristics with Greece: they have soaring pension, Medicaid and employee healthcare obligations, but their tax revenues are either stagnant or prone to boom and bust cycles--and the current boom cycle is now entering the inevitable bust phase, when tax revenues plummet but the obligations just keep piling up. The template of over-indebtedness as a response to soaring obligations is scale-invariant, and it always ends the same way: default, more financial tricks to mask the default, and eventually, insolvency, bankruptcy and massive losses being distributed to everyone foolish enough to choose financial trickery over dealing with reality back when the pain would have been bearable.
There is much to enjoy and savor, but it is overwhelmed by moron madness. We’ve come to believe that Aldous Huxley’s fears have been manifested on the boardwalk of Wildwood and across our entire nation. The masses don’t read books. We are inundated with so much useless information, we have been reduced to passivity and egotism. The truth is buried in a sea of irrelevance and our culture is based upon triviality. Our almost infinite desire for distractions and pleasure have produced a profoundly abnormal society. The ignorant masses are acting normally only in the context of living in a sick, demented, abnormal society.
"When I hear the Germans say that they maintain a very moral stance about debt and strongly believe that debts must be repaid, then I think: what a huge joke! Germany is the country that has never repaid its debts. It has no standing to lecture other nations. ... Germany is really the single best example of a country that, throughout its history, has never repaid its external debt. Neither after the First nor the Second World War. However, it has frequently made other nations pay up... "
On the heels of Sunday's landmark referendum in Greece, all eyes are now on global financial markets and how the European Central Bank intends to prevent contagion in the event Greece exits the currency bloc.
Financial experts in New York, London, and Brussels have tut-tutted Greece’s economic travails as Athens considers its future with the European Union. Why did they borrow so much money? How can they ever pay it back? Do they think that much debt is sustainable? Instead of pointing fingers at the innumerates running Athens, they should consider our own situation.
"Investors have experienced many mood swings, some institutionalized irrationality, as well as treacherous trading conditions in the first six months of 2015. The wacky has become the norm."
The Abe Cabinet's approval rating plunged to 39%, matching a record low, as more than half of voters oppose the new US-sanctioned military/security legislation being debated in the Diet. The last time Shinzo Abe's approval ratings were this low, he called for a snap election and told Kuroda to unleash QQE2.0 which has only squeezed real wages to even record-er lows (24th month in a row of declines), destroyed-er elderly Japanese savings, and crushed-er the middle-class. As his popularity has waned, Abe has become more and more desperate to keep support and has, for the first time in 70- years, lower the minimum voting age from 21 to 18 (adding 2.4 million new voters who have not been demoralized yet by declining pension benefits and quality of life).
... the long-term deficit and debt that we have accumulated is unsustainable. We can't keep on just borrowing from China, or borrowing from other countries because part of it is, we have to pay interest on that debt. And that means that we're mortgaging our children's future with more and more debt, but what's also true is that at some point they're just going to get tired of buying our debt. And when that happens, we will really have to raise interest rates to be able to borrow...