The US economy has a ton of fundamental problems mainly debt, FED. The problem is not coronavirus it is everything below.
- FED doing qe buying up bonds because there are no other buyer at these interest rates, this means interest rates should to go up but FED has been holding them artificially low for since around 2000
- FED continues to increase bond and repo market purchases now 175 billion for repo (going much higher)
- FED held interest rates super low for so long and eventually going negative
- FED interest rate policy has allowed debt to expand massively FED cut to 1.5% caused 08 housing bubble we have been down to 0 for entire Obama presidency only able to raise to 2.25 before cutting on our way to negative
- 23.5 trillion federal debt (not a problem yet) but what happens when treasury yields skyrocket despite qe because no one wants to accept a .5% 10 year yield for a country massively in debt and real inflation around 10% going higher
- if interest rates do rise who knows how high they could go probably at least 10% + 24 trillion in debt we would have to pay 2.4 trillion a year which would mean bigger deficits, more money printing, more qe, more inflation (we only bring in 3.5 trillion in tax)
- Federal deficit 1.3 trillion going higher
- Federal debt to GDP ratio highest ever 107%, federal/state/local 122%, 36% spending to gdp ratio
- 76 trillion total debt, 24 federal, 1.2 trillion state, 2 trillion local, 20.4 trillion personal, 1.6 trillion student loan (default rate last at 25% with record low interest rates) (going much higher in recession) credit 1.1 trillion WITH ONLY 15700 IN SAVINGS per citizen, debt per citizen federal- 189473, state- 3650, local- 6423, personal 63k, student 37k, credit 6k, corporate sky-high
- 128 trillion in unfunded liabilities around 400,000 unfunded liabilities per citizen
- median income not rising with inflation 30k in 2000 33k now - inflation real number almost 10% annual
- 89 trillion in currency and derivatives in 2000 now 672 trillion up 755% in 20 years
- trade deficit 850 billion we owe 6.8 trillion in debt to other countries
- unemployment rate likely to skyrocket to coronavirus which will cause big problems with all the debt we have
- All the problems we have are much bigger than 2008 with record bailouts coming
- FED doing qe buying up bonds because there are no other buyer at these interest rates, this means interest rates should to go up but FED has been holding them artificially low for since around 2000
- FED continues to increase bond and repo market purchases now 175 billion for repo (going much higher)
- FED held interest rates super low for so long and eventually going negative
- FED interest rate policy has allowed debt to expand massively FED cut to 1.5% caused 08 housing bubble we have been down to 0 for entire Obama presidency only able to raise to 2.25 before cutting on our way to negative
- 23.5 trillion federal debt (not a problem yet) but what happens when treasury yields skyrocket despite qe because no one wants to accept a .5% 10 year yield for a country massively in debt and real inflation around 10% going higher
- if interest rates do rise who knows how high they could go probably at least 10% + 24 trillion in debt we would have to pay 2.4 trillion a year which would mean bigger deficits, more money printing, more qe, more inflation (we only bring in 3.5 trillion in tax)
- Federal deficit 1.3 trillion going higher
- Federal debt to GDP ratio highest ever 107%, federal/state/local 122%, 36% spending to gdp ratio
- 76 trillion total debt, 24 federal, 1.2 trillion state, 2 trillion local, 20.4 trillion personal, 1.6 trillion student loan (default rate last at 25% with record low interest rates) (going much higher in recession) credit 1.1 trillion WITH ONLY 15700 IN SAVINGS per citizen, debt per citizen federal- 189473, state- 3650, local- 6423, personal 63k, student 37k, credit 6k, corporate sky-high
- 128 trillion in unfunded liabilities around 400,000 unfunded liabilities per citizen
- median income not rising with inflation 30k in 2000 33k now - inflation real number almost 10% annual
- 89 trillion in currency and derivatives in 2000 now 672 trillion up 755% in 20 years
- trade deficit 850 billion we owe 6.8 trillion in debt to other countries
- unemployment rate likely to skyrocket to coronavirus which will cause big problems with all the debt we have
- All the problems we have are much bigger than 2008 with record bailouts coming
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