"...by the end of September 2012, the Debt will have soared to $16.2-trillion – which amounts to nearly 100% of the projected Gross Domestic Product that year."
My husband is an expert in finance. Friday evening he said something that was so simple and summed everything up so well:
"No one builds wealth on debt. No one."
We owe a lot of money. The government says to those we owe: rest assured, do not worry, we're good for it.
"...the U.S. government’s power to tax stands behind all of its debt."
So rest assured (if you dare) if you are say, China. But if you live here and work hard and earn a decent paycheck, not so much.
We became a society comfortable with, and dependent upon, debt to fuel our lifestyles and meet our obligations. Most of us are guilty on some level, right? And the goverment sure is...
"It took the U.S. government 191 years – from 1791 until 1982 – to run up its first trillion dollars in debt."
But we're way better at it now!
It feels like the government is playing a financial shell game; like a person paying off credit cards with other credit cards to trade it around and push the ultimate due date down the road.
The market rallied today, as it very well might when an announcement seems plausible on paper. The market has also shown us very clearly in recent months that Theory and Application are two different things. Experts are divided about the Public-Private Partnership To Buy Toxic Crap. We'll see who wants to get in bed with the government on that one.
I think we are in deep weeds. It is my belief that our current situation will result in a lifestyle adjustment for most Americans that will last longer than we are currently considering possible. Hopefully, I'm wrong.
On a personal level, it's been food for thought. Wouldn't a giant deflation of everything be a bit of a relief? Painful to go through certainly, but in the end, maybe I would be more grateful. Perhaps I would be more content with what I have once I've purged the excess.
Back to basics, as they say. Seems that's never such a bad idea, you know?
What changes have you made in reaction to all the uncertainty? What are you considering doing? Are you bullish or bearish right now about our near to mid-term future?