What Are The Dangers Of Too Much Debt?

Submitted by: AntEconomist 5 years ago in

A 1% increase in interest rates will cost as much as the Iraq war.
There are 26 comments:
Male 406
The debt is an issue only during election cycles. All sides blaming the others. Other times mums the word. Except for teabaggers like this douche!
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Male 1,089
obama: bitch please
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Female 2,764
dang007--- so we should do nothing?
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Male 371
@wiscesq: 10 years ago, you`d have an argument. To take advantage of lower short term rates, the treasury has been rolling long term debt over to short term debt. The result is that the government debt is now highly exposed to short term interest rate changes.
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Male 111
The national debt is too high and is unfair to children and future generations, but this guy`s analysis is simply wrong. While the government does refinance its debt to take advantage of decreasing interest rates, there is simply no reason it would refinance its entire debt if interest rates were increasing. New debt might be borrowed at the higher rate, but the interest expenses on the entire existing debt would not go up. If your mortgage rate was 5%, and the market went up to 7%, would you refinance your mortgage at the higher rate?

Neither would the government.
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Male 144
How did you get into this much debt again?
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Male 37,774
See? THIS makes sense, and what is Obama doing? The OPPOSITE! That`s what.
Obamacare is "funded" by a shell game: future revenue will rapidly rise, costs will drop, we`ll cut other funding & etc. That`s what the Dems base their projections on, and it ain`t ever happened and it ain`t gonna.
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Male 371
@I-IS-BORED: Yes, the numbers are adjusted for inflation. On the vertical axis it says "2011 dollars". That means the figures are all in terms of today`s purchasing power.
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Male 17,512
Totally agree with this guy.
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Male 25,416
Debt... means you have more stuff. And everyone likes stuff
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Male 645
>>>We should do this for as many years as it takes. <<<

Sure lets see that will take Uh forever as 2.5 Billion/year does not even cover the INTEREST on the debt much less actually make a dent in the principle. Even if if all went to principle it would take, 5,600 years. Something tells me that congress might just spend it on other things at some point.
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Male 550
He compares US debt to US war costs?
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Oh, this means someone thinks that stopping these wars will reduce US debt?
Oh, i misunderstood that, sorry, go on.
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Male 658
I don`t trust this guy`s haircut.
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Female 2,764
If everyone in America over the age of 18 gave $10 a year, we could pay down $2,500,000,000 dollars a year on our debt. We should do this for as many years as it takes.

(I did that math on my own, so don`t whine about how wrong it is, if anything, it`s a low guess)

I don`t like the situation we are in, I don`t like the thought of my hard earned money going to things I didn`t/don`t agree with, but I still feel responsible for my bills/debts and feel we need to do something about it NOW instead of watching things get worse.
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Male 5,811
[quote]At this point, I`d buy stock in China, not USA.
Canada seems a safe bet but Europe is iffy.[/quote]
The firm I get a lot of my investment advice from has been pushing "BRIC" stocks: BRazil, India, China. They have had great GDP growth, although I haven`t invested new money lately, so some might not be as good right now. Doesn`t matter to me as much how the stocks are doing, I still get my dividends.
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Male 3,285
@rpossum. FOr households sure. For governments that method of budgeting rarely, if ever works. Use google and do a bit of research. Theres plenty of sites that go into a lot of depth about it.
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Male 10,440
Last I checked you guys still had a deficit. Good luck paying down your debt right now.
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Male 38,478

At this point, I`d buy stock in China, not USA.
Canada seems a safe bet but Europe is iffy.
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Male 104
Ron paul
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Male 14,832
Any person or institution that lends to an over burdened, under provisioned government in an inflationary bear market at 3% needs to have its head examined.
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Male 2,419
Did he scale those war expenses to current dollars at all? He never said...
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Male 9
It was so nice to watch a video that talked about government without party leanings. Give that man a cookie
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Male 1,122
Bottom line a responsible government\bank\household needs to never spend more than they make excluding cases of emergency, such as defense or natural disaster.
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Male 1,122
yup
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Male 330
Hey! An economic post without an obscene liberal spin made it on I-A-B!

It`s scary what the truth holds, huh?
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Male 371
Link: What Are The Dangers Of Too Much Debt? [Rate Link] - A 1% increase in interest rates will cost as much as the Iraq war.
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