The catch 22 is if we don’t import oil(or anything) paid for in US dollar, which in turn is used by the foreign nation to buy treasuries, the gov’t would have to cut its spending deficit, but probably not before forcing retirement accounts to buy treasuries.
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good point. however, the added oil production is directly adding 100 billion annually to federal revenues and indirectly another 100 billion byo higher stock market prices.
You’ll notice that in the last year the federal deficit shrank by over 300 billion dollars to about 680 billion dollars. Its on track this year to shrink by another 200 billion dollars.
Result? less need for foreign countries to buy US treasuries.
You are also right that all of this is happening IN SPITE of Obama —not because of him.
And if the dollar stops being the world’s reserve currency, we’ll suddenly no longer be able to print money. We’ll have to live within our means.
With the Obamanation in control, that means DoD will be practically disbanded in favor of socialist programs.
But even worse, when all those outstanding treasuries come due and we can’t pay up...
“There are two ways a nation can use economic growth to reduce budget deficits. The first method is to participate in economic growth, with a growing economy increasing tax collections. A second method is to raise taxes so drastically that they consume all economic growth.
The United States government recently announced it has some great news - a fast moving economic recovery is slashing the size of the deficit.
The real economy (if we accept official US government inflation rates) grew by only 6.7% over three years, while the federal government’s real take of that economy rose by a remarkable 21.9%. Because 6.7% in economic growth is only equal to 31% of the total 21.9% increase in tax revenues, this means that economic growth only accounted for 31% of real tax growth, while it was the increase in tax rates that generated the other 69%.
So while the reduction in deficit is being presented as increased revenues from a surging economy, in fact more than 2/3 of the growth in tax receipts was simply from raising taxes.”
http://danielamerman.com/articles/2014/RealDefC.html
Oh, and I saw an article that said Soros is recommending Obama sell our strategic oil reserves to push the price down, and that would teach Putin a lesson!