They will not be able to afford to pay. They will likely default and start from scratch again, if they are smart enough.
No worry. All is well, until the final collapse which could be many years away.
Sh....... Do not tell and Nobody will know!
This statement is correct. The question is what is the next stage?
Any PONZI scheme will collapse eventually. But it could be decades from now. So party on and have a good time.
It is always hard to predict when the PONZI bubble will pop. The Madoff whistle-blower had been writing to SEC for many years, before it finally collapse by itself as the result of credit crunch from the 2008 financial crisis.
So enjoy yourself and do not worry about it.
It is all a game of increasing the GDP growth faster than increasing the debt load.
These tens of millions of needy are just just tools for some to postpone the eventually collapse of this debt bubble.
There is no doubt that these are worthy programs. But whoever decides to implement them at this time is no magnanimous benefactor.
The US debt problem, including the off balance sheet items and future obligations in addition to the sovereign debt load on the book, has probably become too big to save. It is why nobody should worry about it.
You are right.
But you still follow the same of line of thinking sanctioned by the traditional teaching of modern economics in a assumed "competitive economy". When the debt load gets to be very big, no regular theory will be able to explain it.
The "God's Emissaries" such as Federal Reserve and Goldman Sachs, etc., will likely continue to pump the unlimited liquidity into the global economic system to keep the it afloat, despite the crippling burden of the collective debt load.
The best way to do that is to execute a global debt RESET.
China might complain about the US debt, but it has not much choice over short-run given the global economic structure.
USD is the global reserve currency also because US has unmatching military might and robust financial sectors. Hence dollar is not replaceable if many countries want the change.
If the "Invisible Hand" can pump "Almighty Credit" into the global economy through the Federal Reserve, then the "Invisible Hand" should be able to put in some fixes to the political system.
The only thing that the recent fake drama in DC has achieved is to have provided the folks at the Wall Street to execute a massive global short squeeze on the equity markets.
We know that US will not resort to austerity to solve its debt problem. The favored solution is to engage in demographic engineering to boost the GDP faster than the Debt load, an apparent PONZI approach.
Fed might pump more fantasy money. The stock market might jump more. So have a good time while you can.
In hindsight, the recent clown show of government "shut down" and "debt ceiling" was obvious staged. As I have argued earlier, neither side of the political spectrum wants austerity programs to solve the long-term insolvency of US finance. It increasingly looks like that both of the sides have committed to short-term fixes such as expanding the GDP at the same pace as the Sovereign debt in order to maintain relative stable debt to GDP ratio. The demographic engineering through Healthcare Reform and Immigration Reform are some of the temporary measures implemented or considered.
If this indeed is the plan of those who proclaim to have done the "God's work", then we know that by 2017, the US real GDP would likely reach $19 trillion (CBO and OMG estimates) with an impressive 4+% annual growth. While the total US sovereign debt could reach $20 trillion, the expected GDP to Debt ratio would held relatively stable.
When, or if, this scenario becomes materialized, the federal reserve might start to remove the backstop, i.e. the trillions of dollars handed over by the Creator (;-)). That is when the global equity market might get volatile, again. But, before that actually happens, the Federal Reserve will likely continue to pump the "Almighty Credit" into the global economic system, prompting the participants in the economy to become more "willing" to engage in the transactions so as to create the money needed to boost the economy.
Some prudent people might ask: what happen when the positive effects of these temporary fixes wear out and the negative effects become dominant many years from now? Since I am no genius nor wizard, I would say: do not need to worry about it because you are dealing with benign "Invisible Hand" here. In the worst scenario, a global debt RESET could be executed, and every country will have a clean balance sheet to start with.
Right. The "shut down" drama in DC is completely fake, since there is not intention to change the current course, leading to disaster.
Are you proposing a political structure based on the domination of Cyborgs? ;-))
If we can have Cyborgs which have intelligence level thousand times of that of IBM's deepblue, then why do we need these low-talented actors/actresses in DC? ;-)
After causing havoc to significant part of economy, the result is nothing but continued budget conference.
Where are the sensible measures to solve the long-term insolvency of US finances?
For this kind of high-stake poker game, all rules are off. ( The rules are set for regular folks anyway.)
I just wonder what will come out of this? Healthy long-term fiscal situation?
Both sides seem to dislike austerity. Then they have to continue to expand the demographic base by merging with Canada and Mexico, after taking care of the un-insured and undocumented.
Things can get out of hand easily, as part of plan.
Many believed that Lehman bankruptcy was also part of plan.