Visual World Inflation Index.

Inflation, at bottom, happens when there's more desire [and the money to convert desire into satisfaction,] than available goods. World-wide, goods are transported from here to there to fill desires. Much is carried by ship. When ships which can be carrying goods are forced to lie idle . . ..

The Russian war in Ukraine is restricting the transport of specific goods, primarily wheat and oil. Many ships are anchored around the straits leading north from the Aegean Sea. They can be seen at: MarineTraffic: Global Ship Tracking Intelligence | AIS Marine Traffic

Regards, stay safe 'n well.

 

Inflation is also caused by unwarranted increases in the money supply, significant increases in government spending, bureaucratic rules that restrict supply and government policies, like ending the Keystone Pipeline.

 

Inflation is forcing families to use their credit cards to pay for the things they need. Credit card debt is increasing significantly. They can't just print money like the treasury does. Eventually they will default on their loan just like the US someday.

 

The U.S. Government probably will not default on its debt unless Congress does not raise the debt ceiling. The government and the Federal Reserve can create money out of nothing close to infinity.

The real casualty will be the U.S. dollar. It could lose almost all of its value which would be a disaster for almost all U.S. citizen.

 

I'm not saying now but if we keep spending like we do the US will default. This is why we need to cut spending and stop taking out loans. Once there is too much money in the world the dollar will be worth almost nothing.

 

The interest they get from holding US treasuries is how many nations maintain an ability to purchase US goods. Without those revenue streams, US exports decline significantly. Government debt and personal debt do not work off the same dynamics. Consumers should pay off their credit cards and stop taking out consumption loans, the government, on the other hand....

 

fwiw, while total credit card debt is up 25% from a couple years ago we're still lower than we were 4 years ago. I'm wondering why the dip.

 

That's always the case. In this instance, the US, the holder of the world's reserve currency flooded the global system with hot dollar, that were not paid for with an equivalent amount of goods and services, resulting in an inflation spiral that continues to this day, as we continue to flood the global system with hot dollars.

Regards, stay safe 'n well.

 

The debt ceiling couldn't cause a default. We can cut spending, raise taxes, borrow more. Congress has never defaulted, even w/ circumstances far worse than what we got now.

They'd just have the banks do that, it's where most of our dollars come from.

 

When has the debt been worse, other than the Revolutionary War period and World War II, when there was a good excuse? The debt has only exceeded the GDP under the constitution twice, during the Second World War and now.

 

Debt%GDP is an interesting metric, it shows how serious the debt is in terms of our over all economy and like u said it's as bad as it was during WWII. Note that it's going down again like after the war.


What it leaves out is the debt service. A lot of that debt was piled on back when interest rates were so low that there was one auction that I know of where folks were buying bonds at ZERO percent! Free money.

Here's a chart that shows the historic debt service (how much we're PAYING for our debt) as a percent GDP:

My bet is that as interest rates continue to climb we'll see a lot less borrowing to finance the debt. I may be wrong...

 

Debt service is soon going to be one of the largest expenses the Federal Government must cover.

 

Remember that service percent total outlays had gotten down to the lowest it had been in 70 years --we have a long way to go before we're "largest" again.

 

That's not what inflation is. You're describing supply and demand. Big difference. You people are desperate to redefine this one...lol

 

The US has defaulted on debt four times.

https://thehill.com/opinion/finance...ted-on-its-debt-except-the-four-times-it-did/



While we have plenty of money coming in each month to service the debt and make social security checks, Biden could, and he's degenerated enough that he is capable of, defaulting and stopping social security checks if he doesn't get his way. I think the House should promptly impeach him if he does, for violating the 14th amendment, but, who knows if they will.

If Illegitimate Joe 'did default now, it would be the fifth time, not the first. There have been four explicit defaults on its debt before.'

1. 'The default on the U.S. government’s demand notes in early 1862, caused by the Treasury’s financial difficulties trying to pay for the Civil War. In response, the U. S. government took to printing pure paper money, or “greenbacks,” which during the war fell to significant discounts against gold, depending particularly on the military fortunes of the Union armies.
2. The overt default by the U.S. government on its gold bonds in 1933. The United States had in clear and entirely unambiguous terms promised the bondholders to redeem these bonds in gold coin. Then it refused to do so, offering depreciated paper currency instead. The case went ultimately to the Supreme Court, which on a 5-4 vote, upheld the sovereign power of the government to default if it chose to. “As much as I deplore this refusal to fulfill the solemn promise of bonds of the United States,” wrote Justice Harlan Stone, a member of the majority, “the government, through exercise of its sovereign power…has rendered itself immune from liability,” demonstrating the classic risk of lending to a sovereign. In “American Default,” his highly interesting political history of this event, Sebastian Edwards concludes that it was an “excusable default,” but clearly a default.
3. Then the U.S. government defaulted in 1968 by refusing to honor its explicit promise to redeem its silver certificate paper dollars for silver dollars. The silver certificates stated and still state on their face in language no one could misunderstand, “This certifies that there has been deposited in the Treasury of the United States of America one silver dollar, payable to the bearer on demand.” It would be hard to have a clearer promise than that. But when an embarrassingly large number of bearers of these certificates demanded the promised silver dollars, the U.S. government simply decided not to pay. For those who believed the certification which was and is printed on the face of the silver certificates: Tough luck.
4. The fourth default was the 1971 breaking of the U.S. government’s commitment to redeem dollars held by foreign governments for gold under the Bretton Woods Agreement. Since that commitment was the lynchpin of the entire Bretton Woods system, reneging on it was the end of the system. President Nixon announced this act as temporary: “I have directed [Treasury] Secretary Connally to suspend temporarily the convertibility of the dollar into gold.” The suspension of course became permanent, allowing the unlimited printing of dollars by the Federal Reserve today. Connally notoriously told his upset international counterparts, “The dollar is our currency but it’s your problem.”'

 

Most folks define "default" as failure to pay in dollars what is owed in dollars. The examples you gave have nothing to do w/ that but rather call to the idea of the government being willing ot exchange precious metals for dollars. Most folks would say there's a difference. A big difference.

more info: define "default"

 

You have a search bar, do your own work.

 

People still working anyway often used the stimulus checks to pay down debt or just put in the bank

 

this is a bit hard to follow. Maybe you didn't notice the link in my post, the underline doesn't show up 'til u move your cursor over it. Is that the "work" you were thinking of?

 

To be fair, it was a little hard to notice.
I usually make a separate line for any links in my posts, or try to make the link another color and underline it.

 

I wonder if that is really true. I started a thread to discuss that.
Why oil prices are going down

 

Credit card debt went down about $150 Billion from 2019 to 2021. Stimulus checks were no where near that. What I'm seeing is that CC debt goes down in a recession and up in an economic boom, about what we'd expect for sane consumers.

 

that's what I used to do but I don't want to do or say anything that might offend the admin.

 

Hi, kazenatsu.

If it is not true, you'll need an alternate explanation for the large number of ship bottoms at anchor on the route to the usual loading ports.

Regards, stay safe 'n well.

 

the total direct payments came to $814 billion, almost half of which went out in Round 3 under the American Rescue Plan. I am assuming parts of the reasons it went down were college students were home so weren't maxing out their plastic; early on a lot of people stayed at home which meant they weren't out swiping at the pumps or registers as much; and as I said, part of the reason is that people payed down debt. Now for me personally, not having to make my student loan payments allowed me to pay off an embarrassingly high $12K ish in credit card debt which was mostly a combination of college living expenses swipes and home improvement projects. I have kept it at zero from month to month since. For instance if I order something online and use the plastic, I usually pay it off over the telephone within a few days, often before the charge officially posts to the account. Knock on wood, I have zero plans to ever leave myself having to shell out any interest to a credit card company ever again. It also allowed me to buy a new used car when mine died literally the first week of stay at home in the US. I financed it at 2.48% but just paid it off about 5 weeks ago way early. I have also added to my savings (Think about $13K) and done some more home improvement stuff. Man you have no idea how much I dread having to start making those payments again, but it is what it is. Between taxes and student loan payments, Uncle Sam gets about a grand a month out of me in normal times.