The Debt Myth: “We Owe It to Ourselves”

The house collapses when we are no longer able to operate on credit. Don’t know if that is 50% debt to income or 200%. It will happen slowly….then all at once.

It is obvious nobody can be elected anymore on an austerity platform. My guess is it collapses when we lose our economic or military leverage over the world. Crap on Trump all you want but he is the first president since Reagan working against those two things not happening.

Russia is the only country that I can see passing us economically in the distant future. They are not as burdened with debt and their welfare state is not as bloated.

They also have a vast country of unexplored resources not sequestered by a vast Green lobby that works to turn every mineral deposit into a National Monument.

quote:

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“There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.” — Ludwig von Mises, Human Action

There are four theoretical exits from a debt spiral: default, austerity, growth, and inflation. Default is unthinkable to the people whose power rests on the debt’s sanctity. Austerity is unthinkable to the people whose power rests on spending. Growth fast enough to outrun six-percent-of-GDP deficits is a fantasy no honest forecaster will sign. The likely path is a blend of evasions and whatever the blend, its active ingredient is inflation, the exit with no constituency and no ceremony. It is not a policy anyone will announce. It is the station at the end of the line.

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If We Owe 40 Trillion To Ourselves, We Must Be RICH!!