Posted on 02/15/2009 8:38:33 PM PST by Ungarisch
With all eyes focused on how the Pelosi-Reid-Obama “stimulus” plan spends money, there’s been less attention paid to where government will get the money -- and with what consequences.
It must come out of someone’s pocket. The decision by “stimulus” sponsors? Borrow the money, mostly from foreign economies. America already borrows heavily from other countries -- especially the Chinese. But we should remember that whoever pays the piper gets to call the tune. * * * Those who have maxed out their credit cards know that it worsens your credit rating, generating higher interest rates or even a total cutoff. You may feel stimulated after a shopping spree -- but your mood turns to depression when the bills arrive. * * * . . . the latest Treasury Department numbers (November) show China’s holdings in our national debt are up to $682 billion from $459 billion in the prior 12 months. Oil exporters such as the Mid East and Venezuela upped their holdings, and we now owe them $198 billion. We owe Russia $78 billion. And foreigners who use Caribbean banks for secrecy hold our markers for $220 billion. Treasury reports that this group -- China, the MidEast, Russia, Venezuela and the Caribbean -- have been our main sources for new borrowing in the last 12 months.
How much more can we borrow before our creditors cut us off, and Treasury securities become junk bonds that must pay exorbitant interest rates?
All the new debt can ruin the future. * * * Getting the money may cause even more problems than the big government spending. It’s more than a dollars-and-cents issue. Falling deeper in debt to other nations, especially those who don’t have America’s interests at heart, threatens our national security.
(Excerpt) Read more at humanevents.com ...
And if China won’t lend the $$, because they might worry that they won’t get it back, Obama will print $$, and our dollar won’t be worth much.
This cycle of dependency won’t end until the world economy is at its lowest possible point (including ours).
I am not sure that China can lend us even if they want to. Chinese exports have fallen sharply. Without export growth, they do not have the means to buy our debt. Since this recession is world-wide, it seems that foreigners will have much less ability to buy our debt. With lower demand, it seems that we will need to increase interest rates or print money.
If another economy emerges through the carnage of this recession, the US Dollar may be headed much lower. If there is a viable alternative, demand for the US dollar will fall sharply. In the short term, deflation seems more likely than inflation. In the longer term, inflation seems more likely, possibly hyper inflation.
Well to be fair so does outsourcing. . . So he’s just continuing a trend?
“Mid East and Venezuela upped their holdings, and we now owe them $198 billion. We owe Russia $78 billion. And foreigners who use Caribbean banks for secrecy hold our markers for $220 billion. Treasury reports that this group — China, the MidEast, Russia, Venezuela and the Caribbean — have been our main sources for new borrowing in the last 12 months.”
Makes me absolutely sick to my stomach!
I like what Thadeus McCotter called the “Stimulus Bill”. He said it was a Fiscal Obscenity. If the Chinese wanted to hurt us, now would be an opportune time because of our severe indebtedness.
This is a reason that China is falling. And, this debt is the primary reason for Russia and Venezuela having troubles, not oil. Russia holds alot of Euro debt too, and that is not in the calculations. They know that this money is never coming back.
“I am not sure that China can lend us even if they want to.”
I agree, so that would mean the govt. will simply print the money.
And, I can bet that some of this borrowing comes from the Islamic Republic of Iran and Syria...
Even worse than “Stimulus Bill,” the leftist politicians are calling it “ECONOMIC Stimulus” when most of it has nothing to do the with economy.
And I think at this time, Red China realizes that by hurting us, they would further hurt themselves. China is for China.
Globalism is dead
You are absolutely correct. Obama just sold out our sovereignty.
Huh?
ignoring the effects of globalism is dead.
Americans have to learn theren's nothing magical about being American that makes them not have to deal with reality.
Spend more than you create, expect to be paid more than you produce, and here's what you get.
” If the Chinese wanted to hurt us, now would be an opportune time because of our severe indebtedness.”
You and I both know exactly where the money is and will come from to finance the stimulus bill. At this point, I guess my question to you would be: How exactly is it that you are vested in the continuation of this fearmongering misinformation campaign. What exactly is in it for you ?
To purposely post erroniously to keep the pot stirred sort of speak raises the obvious question. This is what I’m thinking. Obviously, your in on it and thus must be receiving some sort of cut.
Wait until our ‘AAA’ credit rating drops!
Whooosssh and the bottom drops out!
Wake Up America!
If Obama is a tried and true follower of Saul Alinsky, then we are in for a very rough ride. Those who will not get on the welfare rolls in the aftermath of an economic collapse will need to prepare now, if they haven't already started.
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