Famous quote “You are only worth tomorrow what you owe today”. Remember when, if you purchased your home you could count on it being worth more than you paid for it. It was your retirement safety net. This makes a lot of sense. This was true until we had the financial crisis but it still is the truth. If it doesn’t work this way then there is something causing the problem. Do you know what that is..? Remember America created a lot of debt and it propelled America to be the world leader and helped other countries prosper as well.
Increasing the debt to $20 trillion dollars or eliminating it all together will act as a springboard for the US as well as for the global economy. After all, if you have a mountain of Gold or Titanium or other precious metals you need to securitize it by writing certificates and then putting them safely in a vault. Once you do that you need to sell the coupons or notes and retire old debt. What is the problem. Just don’t spend it by filling individuals pockets. Congress has to be accountable with penalties if out of ethics.
If no one buys your Notes /coupons, you turn within and that is not what you want to happen. Eastern Europe went thru this for 60 years. If I am a country like China that holds a lot of US assets in the form of currency and notes, how would I invest this. Buy Gold or US Notes /coupons? My bet would be to buy more US Notes /Coupons with the currency from products shipped to the US and do it all over again. After all the debt is securitized and backed by the US Government.
Going over the cliff is jargon created by the media that creates fear. Fear is what suppresses people to be lead in a downhill slide. Yes.. not renewing the taxes reductions imposed by Bush will strengthen his legacy as a strong President. Allegedly, not renewing these tax cuts will cause more discomfort with the US Citizens and eroding of the middle class and show weakness of the current administration for both serving parties. None of this negative will happen. America will make adjustments and come out stronger and benefiting America citizens as demanded by the people.
The truth of it all is that it is already determined what the answers are and the destiny to unfold that is very positive as it is written. Pressure will be put on all representatives of the US Government to retire tax laws by replacing them with a more simple laws. Representatives will work together more than ever before for the American people or be removed from serving the American people.
It political goals that are destroying the America’s backbone. The people need to vote for the right people and not re-elect those that hold back growth and wealth for all American people.