So, disaster has been avoided.
The government is open and the debt ceiling has been raised…again.
Break out the champagne right?
Obviously this is sarcastic. But there is actually some good news here.
We have a little longer to get prepared. The government kicked the can a little further down the road, but it wasn’t easy. They may not be able to do it many more times.
All of the political turmoil and bickering we’ve been seeing on the news is completely irrelevant. The problem is a simple mathematical one, not a political one.
When trying to sort out the economic and political BS, there are only three things to consider.
1. How much money do we bring in?
2. How much do we spend?
3. How much to we owe?
Here are the answers, but to make the numbers more understandable lets divide them all by the US population, currently sitting around 316,862,879. This will give us the per person numbers.
1. The US brings in $2.57 Trillion a year, which is $8,110 a year, per person.
2. We spend $3.83 Trillion, which is $12,087 per person.
3. We owe $16.8 Trillion, which is $53,019 per person.
So you, and everyone in your household, brings in about $8,000 a year, spends $12,000 and owes $53,000. Guess what? That can’t continue for much longer. Simple math right?
I have a real hard time figuring out how my 7 year old son is going to pay off his $53,000 debt with his $4,000 a year deficit. I mean hell, I can barely get him to brush his teeth for more than 20 seconds!
He’s been getting away with it for a while because he just keeps printing up more money, and using all my printer ink. He keeps telling the other kids that his money is real, but I think they are starting not to buy it. I’m afraid that soon the other kids in the neighborhood will get tired of all his funny money and stop accepting it. Then he will have real issues.
Teeth brushing will be the least of his problems when he can’t afford to eat. Shit, I’d love to help, but I have my own $53,000 debt issue to worry about. Tough love baby. Figure it out on your own little dude.
I reckon if he were smart he’d buy something with real value while people are still accepting his little pieces of paper. If he trades those little pieces of paper for land and gold he might look back on this time in his life as the greatest opportunity he ever had.
Most likely he will just keep printing until finally no one wants it any more. Then he won’t be able to buy anything.
Hard times fo’ schnizzle.
Me, fortunately I’m not a seven year old. I know better. I own gold. I have junk silver near by. I own foreign real estate, with agricultural potential. I have some food and a gravity water filter stockpiled just in case. I even have a foreign bank account where I can convert my savings into another currency at the drop of a hat. I sure feel sorry for those folks raising their glasses in celebration right now. Little do they know what life is going to hand them. But what can you expect they are just kids.
So, How old are you by the way?
Have a great day!