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64 Days And 1.485 Trillion Dollars
64 Days And 1.485 Trillion Dollars
From July 28th to Oct 4th 2008 the Congress and the Senate raised the US debt ceiling limit from $9.815 trillion to $11.3 trillion. That is a staggeringly bone crushing 1.485 trillion dollars of new debt in just 64 days.
That is $23,203,125,000 a day. At that rate Washington will add $7.494 trillion to the national debt by Oct 1, 2009 which is the first day that President-elect Obama's budget will go into effect. Even if we add just $5 trillion to the national debt over the next 11 months the total debt will be 16.3 as opposed 18.794 trillion dollars. Either figure will crush the taxpayers.
There is a simple workable solution that will solve our current economic crisis. If you prefer, you can skip to the concluding paragraphs to read it.
Neither 5 trillion nor 7 trillion dollars will solve the problems we face. Martin Weiss has proven that we need several times that much money to bailout every one with bad debts.
Currently, people all over the world are withdrawing money from Hedge Funds and Mutual Funds are parking their money temporarily in US Treasury-bills. About 40% of our debt is held by Social Security and other government agencies. But what would happen if foreigners balked and refused to either buy our new debt issues or to renew our existing debt as it expires? The answer is that we would have to pay significantly higher interest rates. Martin Hennecke senior manager at Tyche has already issued a warning that America could soon lose its AAA bond rating which would definitely raise interest rates and kill Obama's budget before it even starts.
In 2003 the cost of servicing the debt was 16.3% of all federal spending. If we double the total amount of debt held by the public and triple or quadruple the interest rate on both the newly issued and also the older rolled over debt, half of President Obama's first budget could easily swallowed up by interest payments. Nothing would be left over for medical care, education or any other social program.
There is exactly one solution to our problems. We must repeal the Federal Reserve Act of 1913 as proposed by congressmen Dennis Kucinich, a Democrat, and Ron Paul, a Republican.
We currently have a debt money system which requires us to create a debt before we are allowed to create money. Under the present system if the Treasury Secretary wants to borrow $100 billion,the Federal Reserve Bank of New York, the official US depository, makes a bookkeeping entry in the federal government account and in exchange the taxpayers are obligated to pay the FED $100 billion plus interest. And that is how we created more than ten trillion dollars in bonded indebtedness which will soon grow to 20 trillion within 24 months.
My regular readers know that I have called all government debts a fiction. If we bought the stock of the Federal Reserve owned by the member banks, we could create new money without adding debt. Money is a commodity that measures the value of all goods and services for sale. And prices can be thought of as a ratio of the commodity known as money to the Gross Domestic product (GDP) which measure the value of all goods and services produced in the US. If we create new money at the same rate as our GDP grows, then we should have price stability. If our total M3 Money Supply were $10 trillion and our normal growth rate were 4%, we could create $400 billion in new checking account money at the New York Fed and spend it into circulation. I would prefer to use that money to bailout people, their pensions and savings rather than the billionaires of Wall Street.
I can absolutely guarantee you that the dollar will collapse in 2009 if we do not purchase the Federal Reserve Bank. The Congress and Senate will be is session next week. They will be passing a second Stimulus package and over the next two months will be considering bailing out the auto industry, local and state governments, creating a $300 billion Public Works program, as they continue the Bailouts covered by the Housing Recovery and the Emergency Economic Stabilization Acts of 2008. We could buy the Federal Reserve Bank for less than just the cost of the upcoming Stimulus Package and save the taxpayers 5 trillion dollars in new debt and interest obligations. Exponentially growing “fictional” debts and the related non-fictional interest payments will crush us within the year.
In a previous essays I said we should cancel the debt (in a responsible fashion) of both Third World nations and the United States now that Americans are increasingly becoming aware that Wall Street is treating them as badly as any colonial subject in 19th century Africa.
I have also pointed out that in 1968 it took one billion dollars in new debt to create a billion dollars in GDP growth. Today it takes $5 trillion in new debt to create a trillion dollars in new GDP. We have reached the end of the line for the Debt Money System. It could soon take ten trillion dollars to create just one trillion dollars in new GDP. There will literally not be enough money around to satisfy Wall Street's insatiable greed.
America has come to the end of the road. The only two paths available to us. One is to accept permanent poverty and creeping enslavement by doing nothing and allowing the Federal Reserve Bank and Wall Street to sack and loot our country or we can buy the FED and salvage our freedoms and allow the people of this country to rebuild the nation and the economy that will otherwise be completely destroyed within 12 to 24 months.
To read why Martin Weiss believes the Bailouts will fail please go here:
To read about non-interest bearing debt free currencies please go here:
To read about the public debt please go here:
To read about how Wall Street has been stealing billions of dollars each week from inadequately audited federal spending please go here: http://solari.com/archive/missing_money/