Chart Of The Day: Change In Q1 American Debt And GDP

Tyler Durden's picture




 

Presented without much commentary, because little is necessary: the only ratio that matters for the US economy, the change in US public debt ($359.1 billion) and US GDP ($142.4) in the first quarter, hit 2.52x and rising.

It takes $2.52 in new debt to "buy" $1 of economic "growth"

Source: Debt to the Penny, Commerce Dept

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Fri, 04/27/2012 - 09:17 | 2379835 FOC 1183
FOC 1183's picture

this is posted as Cramer is praising Krugman on CNBC.  Beauty

Fri, 04/27/2012 - 09:21 | 2379859 GetZeeGold
GetZeeGold's picture

 

 

That guy should get a Nobel Prize.

 

Fri, 04/27/2012 - 09:38 | 2379887 Oh regional Indian
Oh regional Indian's picture

Negative Velocity of Money Champs. Such is how it ends, not with a bang but with a whimper.

The wheels of a bloated civilization grind to a halt. 

Debt bubbles exploding makes me see very ugly pictures...

ori

re-membering-deepwater-horizon

Edit: I just realized KRUGman is GOLDman......Kruger, Krugerrand....see? ;-)

Fri, 04/27/2012 - 09:47 | 2379970 Hard1
Hard1's picture

Just increase debt faster and GDP can grow at 4%.

Fri, 04/27/2012 - 09:52 | 2379999 DeadFred
DeadFred's picture

A current rates we double the debt in ~7 years. That means I can have 40% more iPhones, cool!

Fri, 04/27/2012 - 10:10 | 2380062 Hugh_Jorgan
Hugh_Jorgan's picture

We'll grow our way out... really!

Fri, 04/27/2012 - 10:16 | 2380081 Cdad
Cdad's picture

Hello fiscal cliff...

Fri, 04/27/2012 - 10:29 | 2380114 DaveyJones
DaveyJones's picture

fuck, these numbers are pretty nasty

Why do i hear Reinhart and Rogoff in my head.

Fri, 04/27/2012 - 10:43 | 2380165 Rubbish
Rubbish's picture

I want a refund, I didn't get any of that Big Red on the left.

Fri, 04/27/2012 - 11:01 | 2380209 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

I love the smell of deflation in the morning..... it smell like...... poverty. Give me my Nobel dammit!!

Fri, 04/27/2012 - 11:37 | 2380311 Agent P
Agent P's picture

You get the little blue on the right.  The Big Red on the left goes to your children.

Fri, 04/27/2012 - 12:16 | 2380439 Thomas
Thomas's picture

And the GDP has all those dubious inflation adjustments embedded. What a fucking mess.

Fri, 04/27/2012 - 12:12 | 2380435 tabasco71
tabasco71's picture

Fred

At the rate at which iphones obsolesce, in 7 years you can probably have all the iphones made 

Fri, 05/11/2012 - 23:35 | 2419341 matrix2012
matrix2012's picture

Yes, many more iPhones, iPad atau the latest Galaxy things; 52-inch 3-D LED TV or Internet-able LED TV; new 3.0 4WD SUV... feel free to add the long list that builds the strongly pushed forward GLOBALIZATION DREAM...

 

 

"Hello?

Is there anybody in there?

Just nod if you can hear me.

Is there anyone at home?

Come on, now,

I hear you’re feeling down.

Well I can ease your pain

And get you on your feet again.

Relax.

I need some information first.

Just the basic facts

Can you show me where it hurts?

Pink Floyd – Comfortably Numb

 

 

Our civilization has adopted the worst aspects of the two most famous dystopian novels in history – Orwell’s 1984 and Huxley’s Brave New World. The question is whether the population of this country is too far gone to recover. The answer to that question will determine whether the country chooses authoritarian dictatorship or a renewal of our founding principles. Aldous Huxley understood the three pillars of Western civilization fifty years ago and that their destruction would result in a collapse of our economic system:

“Armaments, universal debt, and planned obsolescence – those are the three pillars of Western prosperity. If war, waste, and moneylenders were abolished, you’d collapse. And while you people are over-consuming the rest of the world sinks more and more deeply into chronic disaster.” [Aldous Huxley]

The three pillars sustaining the American empire edifice of never ending war, ever accumulating debt and excessive consumerism are crumbling. The growing corruption and weight of un-payable debt have weakened the very foundation of our grand experiment. The existing structure will surely collapse. My entire adult life has tracked the decline of the American empire. I had become comfortably numb. I came to my senses and began to question all the Federal government/Wall Street/Corporate Media sponsored truths about eight years ago. Many others have also awoken and begun to challenge the false storylines dictated by those in power."

quoted from the awesomely, beautifully written, Jim Quinn of The Burning Platform in Comfortably Numb 

http://www.zerohedge.com/news/guest-post-comfortably-numb

 

A bit more about Aldous Huxley:

Foreword from

Amusing Ourselves to Death

by Neil Postman

We were keeping our eye on 1984. When the year came and the prophecy didn't, thoughtful Americans sang softly in praise of themselves. The roots of liberal democracy had held. Wherever else the terror had happened, we, at least, had not been visited by Orwellian nightmares.

But we had forgotten that alongside Orwell's dark vision, there was another - slightly older, slightly less well known, equally chilling: Aldous Huxley's Brave New World. Contrary to common belief even among the educated, Huxley and Orwell did not prophesy the same thing. Orwell warns that we will be overcome by an externally imposed oppression. But in Huxley's vision, no Big Brother is required to deprive people of their autonomy, maturity and history. As he saw it, people will come to love their oppression, to adore the technologies that undo their capacities to think.

What Orwell feared were those who would ban books. What Huxley feared was that there would be no reason to ban a book, for there would be no one who wanted to read one. Orwell feared those who would deprive us of information. Huxley feared those who would give us so much that we would be reduced to passivity and egoism. Orwell feared that the truth would be concealed from us. Huxley feared the truth would be drowned in a sea of irrelevance. Orwell feared we would become a captive culture. Huxley feared we would become a trivial culture, preoccupied with some equivalent of the feelies, the orgy porgy, and the centrifugal bumblepuppy. As Huxley remarked in Brave New World Revisited, the civil libertarians and rationalists who are ever on the alert to oppose tyranny "failed to take into account man's almost infinite appetite for distractions". In 1984, Huxley added, people are controlled by inflicting pain. In Brave New World, they are controlled by inflicting pleasure. In short, Orwell feared that what we hate will ruin us. Huxley feared that what we love will ruin us.

This book is about the possibility that Huxley, not Orwell, was right.

 

 

_______________

“Consumerism is able to captivate the individual soul in a way that fascism was never able to do.” — Pier Paolo Pasolini

 

Fri, 04/27/2012 - 10:21 | 2380092 Hohum
Hohum's picture

Yes, more debt so more growth.  I think it's been that way most of my life (born 1965).

Fri, 04/27/2012 - 12:59 | 2380533 Mentaliusanything
Mentaliusanything's picture

my how young you are. 

It's not getting any better sweet pea. Nixon.... I understand why he did it but sweet mother he never got the hidden story. 

Any way, I do respect Ben B .. the only tool he has left is himself .. and thats one BIG TOOL.

Pity he painted himself into that corner.

The best revenge is to understand that inflation will save us all. until you understand Ying and Yang... the balance.

Ben does not, and its coming, snowflake by snowflake until it take us all out in an avalanche of debt destruction 

Hey Ben don't forget Inflation ... you made a fart in a tornado.

Thank goodness I left

Fri, 04/27/2012 - 10:29 | 2380116 Hansel
Hansel's picture

Quick, buy some 10 yr treasuries yielding 1.94%.  The taxpayers are good for it!  /not

Fri, 04/27/2012 - 11:59 | 2380387 eatthebanksters
eatthebanksters's picture

The model of success...shrinking revenues and increasing costs!  Only in Amerika!

Fri, 04/27/2012 - 12:13 | 2380418 tabasco71
tabasco71's picture

Re "Just increase debt faster and GDP can grow at 4%"

Like China does?

just wondering...

Fri, 04/27/2012 - 09:57 | 2380020 a growing concern
a growing concern's picture

Of topic- I just went through airport security, and for the first time in my life I long to leave this godforsaken shithole and go somewhere free. Never felt this so strongly before I had my entire body irradiated, had to remove my shoes and belt, and watched some 3 year old have to go through the scanner. A fucking 3 year old. Unbelievable.

Fri, 04/27/2012 - 09:59 | 2380027 krispkritter
krispkritter's picture

You don't even have to go to an airport to be violated...just sit home and relax;

http://www.guardian.co.uk/commentisfree/cifamerica/2012/apr/26/how-national-security-agency-gone-rogue

Fri, 04/27/2012 - 10:35 | 2380142 Fish Gone Bad
Fish Gone Bad's picture

Thought crime is the new blasphemy.

Fri, 04/27/2012 - 13:39 | 2380628 lemonobrien
lemonobrien's picture

USA! USA! USA!

Fri, 04/27/2012 - 10:37 | 2380150 DaveyJones
DaveyJones's picture

that's exactly what TSA said: "fucking three year old"

Fri, 04/27/2012 - 11:31 | 2380289 SheepDog-One
SheepDog-One's picture

'Ya mind if I touch ya BALLS sir? I just needs ta check ya ASSHOLE...''  I 'jus needs ta check ya asshole - YouTube

Thats 'america for ya.

Fri, 04/27/2012 - 11:53 | 2380333 earleflorida
earleflorida's picture

just sitting back and waiting for a ZH [your a big boy, yeah i'm a big boy] plug on SouthPark - 10.... 9... 8..7. 6 

c'mon randy - spanky, and the gang have had it with ya spending their inheritance, and I, the 'authoritum cartman', ain't gonna take it - so, suck my balls!

Fri, 04/27/2012 - 11:38 | 2380316 NOTfromSanFrancisco
NOTfromSanFrancisco's picture

 

to g c...

That is why some of us have changed our travelling habits drastically. If I can't drive where I want to go, there will have to be a very, very important reason before I will stand in one of those government inspired lines to get my public physical exam again...

Fri, 04/27/2012 - 12:36 | 2380481 NotApplicable
NotApplicable's picture

I haven't flowm since '99.

Fri, 04/27/2012 - 12:44 | 2380491 pods
pods's picture

You got me, I think my last time was when you could still bring lube in your carryon, circa 2006.

Fri, 05/11/2012 - 23:50 | 2419368 matrix2012
matrix2012's picture

No wonder the airlines industry are crumbling!

TSA has been doing the terrific jobs in SECURING the airlines future.

 

Make me wondering how's the tourism business there after the presence of the monster TSA?

Fri, 04/27/2012 - 12:29 | 2380469 rosiescenario
rosiescenario's picture

Terrorists.......10

 

Fed Bureakrats.......15

 

U.S. citizens..........-20

Fri, 04/27/2012 - 13:25 | 2380607 Mentaliusanything
Mentaliusanything's picture

Three year olds ..... my God check them all .. remember after the terrible two's they graduate at Three to Hell on Earth. But when they become adults and remember that blue gloved demi God who touched and gave a little squeeze, they become Graduates of ....... Well let us say Home of the Brave but not really pediphile that it matter a shit.

I left before Nixon and I found a place.. a wide open land, brown and flat, wealthy and free, well free enough that you can go five days and not see a Human in a blue glove. In fact I have never seen gloves only friendly smiles

Question .. Why is it Blue or White (the gloves) Conditioning runs so deep it frightens me and allows me to understand that in the camps, why they did not overpower the few. perhaps it was the weakness of hunger. You shall know that answer. 

It has become the same,,, little by little they herd you until your trapped

Fri, 04/27/2012 - 11:32 | 2380295 Stoploss
Stoploss's picture

BINGO...

It's all about the velocity. Very well done.

The Chairman of the Facist NeoKeynesian Libertarian Party, some how to my surprise, is not pushing the banks to loan quite as strongly as in the previous 2 years. Why??

Velocity... ANY velocity of money at this point in time would be catastrophic instantaneously on a global scale. resulting in immediate, and ultra massive global hyper inflation almost overnight. This is the specific reason the FED cannot move the inflation needle past 1.5%. there is no velocity to allow this to occur, therefore monetary velocity  cannot be allowed to occur, since a tiny amount would result in an immediate inflation spike to 10%, marking the day you stopped commuting and eating. The FED has done an excellent job of destroying itself, much to my pleasure, but now it seems they themselves know the end is near, (you saw that in their faces yesterday).

Additional monetization will be useless, and serve no purpose but to further drive PM's and energy prices into the stratosphere. I think they know that as well, but the politicians don't. They still believe debt is wealth, as long as that is accepted, monetization will continue until the system self consumes.

Good news:

We are there..

Fri, 04/27/2012 - 18:59 | 2381361 John Wilmot
John Wilmot's picture

Facist NeoKeynesian Libertarian Party

Uh Oh, he went full retard....

Wed, 05/16/2012 - 05:50 | 2419389 matrix2012
matrix2012's picture

"Additional monetization will be useless, and serve no purpose but to further drive PM's and energy prices into the stratosphere. I think they know that as well, but the politicians don't. They still believe debt is wealth, as long as that is accepted, monetization will continue until the system self consumes."

 

Any slightest thought that the politicians are quite aware of the debt problems, but perhaps they think of REPUDIATING the debt claims one day??? A kind of reset. Zero debt, problems solved!

Fri, 04/27/2012 - 12:26 | 2380463 Gully Foyle
Gully Foyle's picture

Oh regional Indian

dude you should play with language more, go Joyceian.

"Negative Velocity of Money Chimps"

"Such is how it ends, not with bling but with a wimple"

 

Fri, 04/27/2012 - 12:40 | 2380486 Stoploss
Stoploss's picture

dude, don't bash me yet. I aint run cross nobody yet that has a clue to what the hell is going on.

DEFINITELY NOT YOU.

Fri, 04/27/2012 - 09:35 | 2379907 Shocker
Shocker's picture

That chart, so simple but says so much. Great chart!

Our economy still in rough shape, with or without GDP growing. There is really no way around it

.

http://www.dailyjobcuts.com

 

 

Fri, 04/27/2012 - 09:55 | 2380006 Dr. Richard Head
Dr. Richard Head's picture

$1 DOHllar in new shared debt for us all now brings 39 cents in GDP growth for the well-connected.  Nice!!!!!  Talk about a great ROI.  USA!!! USA!!! USA!!!

Fri, 04/27/2012 - 10:16 | 2380082 tocointhephrase
tocointhephrase's picture

For the first time in my life, USA!!! USA!!! USA!!!

Fri, 04/27/2012 - 11:44 | 2380331 NOTfromSanFrancisco
NOTfromSanFrancisco's picture

 

...actually toco...

For the first time in our lives, just like Michelle, we can be proud that Michelle's husband is doing his job so well as a hand puppet here in the good ol' USA...Good ol' USA is the nonsarcastic part... I still do love this country... That's why this all saddens me so much...

Fri, 04/27/2012 - 10:29 | 2380113 JustObserving
JustObserving's picture

$1 in real debt brings 39 cents in fake GDP growth (since inflation is adjusted down).

Fri, 04/27/2012 - 13:04 | 2380543 centerline
centerline's picture

In real terms, we crossed over some time ago in the realm that new debt subtracts from GDP.  You are correct that any positive growth is ponzi-based at this point.

 

http://seekingalpha.com/article/195012-debt-the-chart-of-the-century

 

 

Fri, 04/27/2012 - 09:37 | 2379923 Lost My Shorts
Lost My Shorts's picture

Don't be so harsh.  All they need to do is a 1 for 10 reverse split of the dollar, and the ratio looks pretty good !!  Assterity my aus.  The wizards of econ will make it all OK.

Fri, 04/27/2012 - 09:39 | 2379929 LedMizer
LedMizer's picture

Cramer should get the Oscar

Fri, 04/27/2012 - 09:41 | 2379937 toady
toady's picture

Creamer or Krugdude?

Fri, 04/27/2012 - 10:02 | 2380034 Akrunner907
Akrunner907's picture

Tyler,

 

Do you have the YOY chart for debt and GDP?  It would be interesting to see a moving chart on the X multiplier cost of debt to GDP growth.

 

Thanks.

Fri, 04/27/2012 - 10:13 | 2380072 Paul67
Paul67's picture

Maybe Tyler has a better source or can confirm but the link below shows the raw data needed to come up with that number.

http://market-ticker.org/akcs-www?post=204980

The movie quote from the Matrix "your living in a dream world Neo" comes to mind.

Key take away; Convert your paper assets (and I use the word asset in this context lightly) into hard assets (i.e. things that would hurt if dropped on your head from a given height) while you still can.

 

Fri, 04/27/2012 - 10:40 | 2380152 Matt
Matt's picture

A really interesting thing to see is if it works both ways; does a $2.5 cut in government spending only reduce GDP by $1? Unfortunately, we will probably not get to find out.

Fri, 04/27/2012 - 13:05 | 2380548 centerline
centerline's picture

http://seekingalpha.com/article/195012-debt-the-chart-of-the-century

This might help.    I posted it above, but thought it would be best to put it here too.

Do NOT follow this link or you will be banned from the site!