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A Trump proposal for national debt would send rates soaring; Buckle up folks; this guy has to be defeated
Topic Started: May 7 2016, 06:40 AM (753 Views)
Robert Stout
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These charts are inaccurate...Most federal Treasury bonds are owned by Social Security and Medicare....However, these bonds are non-negotiable............. :rollseyes:
Jesus can raise the dead, but he can't fix stupid
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George Aligator
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For those with no education in economics, especially those whose minds have been conditioned if not outright impaired by right wing propaganda, the misapprehension persists that the national debt is somehow consumer debt writ larger. Efforts to disabuse these poor folks have foundered on the problem of explaining a rather complex financial structure in terms easily grasped by people for whom balancing the check book is a challenge.

Think of it this way: The national debt is contained in the form of Treasury bonds. To the untrained, these documents are refered to as IOUs and occasionally "pieces of paper." From this analogy much error springs. Think instead of Treasury bonds as stocks representing ownership in the economy of the United States, the strongest economy on the planet. The big difference between government bonds and stocks traded on the WSE is that the bonds pay a fixed return or dividend whereas the dividend paid by a public corp. goes up and down.

There are, of course, other important differences as well, but the key similarity is that you wouldn't consider Wiget Corp. to be in trouble because it comes out with a public offering, nor is the fact the so much of the corporation profit has to be paid out to stockholders a sign that the company is doomed.
Conservatism is a social disease
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estonianman
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George Aligator
May 8 2016, 11:49 AM
For those with no education in economics, especially those whose minds have been conditioned if not outright impaired by right wing propaganda, the misapprehension persists that the national debt is somehow consumer debt writ larger. Efforts to disabuse these poor folks have foundered on the problem of explaining a rather complex financial structure in terms easily grasped by people for whom balancing the check book is a challenge.

Think of it this way: The national debt is contained in the form of Treasury bonds. To the untrained, these documents are refered to as IOUs and occasionally "pieces of paper." From this analogy much error springs. Think instead of Treasury bonds as stocks representing ownership in the economy of the United States, the strongest economy on the planet. The big difference between government bonds and stocks traded on the WSE is that the bonds pay a fixed return or dividend whereas the dividend paid by a public corp. goes up and down.

There are, of course, other important differences as well, but the key similarity is that you wouldn't consider Wiget Corp. to be in trouble because it comes out with a public offering, nor is the fact the so much of the corporation profit has to be paid out to stockholders a sign that the company is doomed.
The difference being that Widget Corp should be using the start-up capital to produce more wealth, which it will in turn get rewarded for by attracting more investors.

The US government holds an economic gun to everyone's head to buy T-Bills which it then distributes to a little less then half the US population that will never produce anything, except a little consumption. The outlook is that debt will continue to rise to 200% of GDP - with no plans ever to curb spending.

If Widget Corp managed itself like that - Its doubtful that it could use the stock market to fund itself.
MEEK AND MILD
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Robert Stout
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estonianman
May 8 2016, 12:52 PM
George Aligator
May 8 2016, 11:49 AM
For those with no education in economics, especially those whose minds have been conditioned if not outright impaired by right wing propaganda, the misapprehension persists that the national debt is somehow consumer debt writ larger. Efforts to disabuse these poor folks have foundered on the problem of explaining a rather complex financial structure in terms easily grasped by people for whom balancing the check book is a challenge.

Think of it this way: The national debt is contained in the form of Treasury bonds. To the untrained, these documents are refered to as IOUs and occasionally "pieces of paper." From this analogy much error springs. Think instead of Treasury bonds as stocks representing ownership in the economy of the United States, the strongest economy on the planet. The big difference between government bonds and stocks traded on the WSE is that the bonds pay a fixed return or dividend whereas the dividend paid by a public corp. goes up and down.

There are, of course, other important differences as well, but the key similarity is that you wouldn't consider Wiget Corp. to be in trouble because it comes out with a public offering, nor is the fact the so much of the corporation profit has to be paid out to stockholders a sign that the company is doomed.
The difference being that Widget Corp should be using the start-up capital to produce more wealth, which it will in turn get rewarded for by attracting more investors.

The US government holds an economic gun to everyone's head to buy T-Bills which it then distributes to a little less then half the US population that will never produce anything, except a little consumption. The outlook is that debt will continue to rise to 200% of GDP - with no plans ever to curb spending.

If Widget Corp managed itself like that - Its doubtful that it could use the stock market to fund itself.
After investing in Widget like corporations for many years, I have found that corporate upper management steals the bulk of wealth...If corporations are the hope for America, we are screwed...Romney is a perfect example of the "corporate man".... :oyvey
Edited by Robert Stout, May 8 2016, 02:56 PM.
Jesus can raise the dead, but he can't fix stupid
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