Thursday, February 02, 2023

The Unseen Catastrophe

 Congress has been printing money at a spendthrift rate.  Interest rates were low, and now they are rising.

The national debt is at 31 trillion.  The big thing for Congress is, what is the interest payment for the next fiscal year?  What are the implications.

As the interest rates rise, so does the interest on the national debt. The thing to remember is, most people in Congress have not had any education relating to economics. The other thing to remember is that most voters have no idea of what economics is all about. We have a lot of people that think everything is normal and today will be like yesterday. So, what this boils down to is the fact that we could have a meltdown.  

It is kind of like Southwest Airlines.  Everything worked until it didn't.  

If /When the interest rates hit 8% the government cannot pay the interest.  What happens at that point? Your 401K is dust.  They have borrowed everything you have saved and spent it.

Can you spell Zimbabwe? 

Remember eggs don't cost more, your currency buys less.

The idea that costs are rising is absurd.  It just takes more dollars for the purchase.  The government has pissed in the whisky. They have printed what they could not tax out of us.

At some point, when they can't pay the interest on the national debt, the real problem begins. Insolvency.

Precious metals could save your retirement.

I've seen cigarettes go from 25 cents a pack to $10--tell me I am wrong.


dearieme said...

Don't worry: the government finances can be saved simply by abolishing Medicare and Medicaid.

Jim in San Marcos said...

Hi dearieme

That's funny --if you are not retired.

For the heck of it, throw in Social Security funding.

When the government runs out of money, that's next.

Let's keep this a secret.

Anonymous said...

No worries. Our kids won’t even know that Social Security, Medicare or Medicaid even existed. What problem?

Jim in San Marcos said...

Hi Anon

That's funny, the joke is at our expense--current retirees.

dearieme said...

"The Great Depression of 2006"

I was just reflecting today that the title of your blog is not so much wrong as a bit premature. I am not a wild optimist about the next few years.

Jim in San Marcos said...

Hi dearieme

I'm not sure, we had a great depression starting in 2006 to about 2010

What we are coming up on now, is something that could be worse, hyperinflation.

We are printing money at a fast and furious rate. It will end, just not sure when.