European Debt Crisis

Discussion in 'Off-Topic' started by tom66, Aug 8, 2011.

  1. tom66

    Thread Starter Senior Member

    May 9, 2009
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    I don't understand this.

    Right now a lot of countries are worried because they owe debt to each other and the cost of borrowing is rising.

    Now, I don't understand this. These countries are bringing themselves down. Okay, let's say, umm... Country A borrows 100 euros from Country B. Country B borrows 120 euros from Country C. Country C borrows 150 euros from.......

    And so on... everyone is borrowing from everyone else. Why don't they all just write it off? Understand that everyone owing debt to each other is not sustainable.

    A noob analysis of the economy.
     
  2. MrChips

    Moderator

    Oct 2, 2009
    12,449
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    Yes, but the problem is most of the money is owed to the banks, private investors and corporations. These people do not want to take a loss. When sovereign nations default, such as Greece, governments have to liquidate public assets at fire-sale prices in order to pay off the debts. The rich elite wins again. We are moving deeper into a global state of feudalism, oligarchy and slavery where the one percent of the population is in control.
     
  3. tom66

    Thread Starter Senior Member

    May 9, 2009
    2,613
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    Isn't US debt at something like $14.5 bn? That's just ridiculous.

    Although I think people are benefiting from this borrowing, I find it hard to believe that they would benefit if the economy were in crisis. It would probably be in their interest to at least minimise the debt. But maybe they would benefit. We should go back to trading in goats.

    And countries should not borrow so much money, but that is another matter.
     
  4. Wendy

    Moderator

    Mar 24, 2008
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    I think you missed a couple of zero's on the US debt. 14.5 trillion. $14,500,000,000,000
     
  5. BillO

    Well-Known Member

    Nov 24, 2008
    985
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    The Brits count billions differently.

    US Billion = 10^9

    UK Billion = 10^12 or 1 US Trillion.
     
  6. BillO

    Well-Known Member

    Nov 24, 2008
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    And now growing at a rate of almost $1.7 billion (UK) per year:eek:
     
  7. Markd77

    Senior Member

    Sep 7, 2009
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    We used to about 30 years ago, but nowadays a Billion is 1000000000 and a Trillion is 1000000000000.
    UK national debt is now nearly a Trillion pounds or about 1.6 Trillion Dollars.
     
  8. TBayBoy

    Member

    May 25, 2011
    148
    19
    I guess it all could be written off, but say you are the country that is 100 EU in debt, but owed 75 EU. Do you write off the 100, 75, 25, or the interest?

    From what I understand the real uncertainty is these debts have been split up, and spread out to many sources, and the same thing done to the sources debt, all to the point where one country really cant tell how much exposure they have to another countries debt.

    It's like some sadistic hot potato game where you hope your not the last one holding the spud.
     
  9. BillO

    Well-Known Member

    Nov 24, 2008
    985
    136
    Okay, that explains a lot. It's been 48 years since I was a British subject. Irish, actually.

    Jeeezzzz, my dad would thump me for calling us British subjects. Let's just say we lived in the British Isles. No, scratch that. We were Irish, and the Irish counted money in a fashion similar to the British. There, that gets me out of hot water.

    Shamrocks rule!!!!
     
  10. BillO

    Well-Known Member

    Nov 24, 2008
    985
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    So your total accumulated debt is approximately the same as the US annual deficit?

    I'd say you've got things under admirable control!
     
  11. MrChips

    Moderator

    Oct 2, 2009
    12,449
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    When you get to those levels what difference is an extra few zeros?


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    (See the man in the left bottom corner?)
     
    Last edited: Aug 8, 2011
  12. Wendy

    Moderator

    Mar 24, 2008
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    Gee, when you put it that way... just a little overtime at the presses will solve everything!
     
  13. Kermit2

    AAC Fanatic!

    Feb 5, 2010
    3,795
    950
    Every program and dept the government has, or creates, is funded at ever increasing levels every year. The growth of all government budgets is around 7-8%. Simply freezing the amount of money that everyone is spending will eventually allow us to grow out of the mess, BUT NO. We simply reduce the amount of growth, do some accounting tricks to hid some debt, promise to cut more in the future, raise the debt ceiling 2 point something trillion more and then bitch and moan about the Tea Party causing our credit downgrade.

    What part of spending more than you have each year is bad, does the congress not understand? Maybe they should try to run the gov. on the money they HAVE instead of the money they can borrow. No, wait a second. That would mean people getting free stuff from the gov. would have to take a cut, and would get mad and vote them out of office for taking away their free stuff. So instead lets just keep going down this borrow and spend road until we crash into a financial wall and EVERYONE has to suffer, not just the ones getting free stuff. Unless of course you are capable of voting yourself a payraise. That would make you pretty much immune to any financial problems down the road.
     
  14. loosewire

    AAC Fanatic!

    Apr 25, 2008
    1,584
    435
    Watch for the gold bubble ,that where a lot of small Investor money Is now.
    The small Investor always takes the biggest hit,they are on the wrong end of the high speed trading computers.I can't see why the 401k people are not hitting the streets demanding some relief,Instead of listening to brokers to say ride it out. It is dumb to have brokers to tell you not to open your statement to see the bad news. Gold could take a one time dip of 1500.00 dollars and wipe out your life savings. Your money should have a reliable safety factor,not a bubble.People don't stand up for more rights for ther savings and better Insurance on loosses.Instead you have funny named agencies without power to help you.Wall street is a stock company. What about the money that has been lost to drop,people are not complaining loud enough. They wait for years for there profits to come back,why.The bad part of big money
    a broker won't take you unless you have over a million to Invest,that why you accept crooks that is all that left to handle your money. Again I say you are being set up for the gold thing,most gold is on paper only ,one dip and Its zip. Remember they showed you gold could sell for four dollars less a few days ago,so they will remind you that gold can make an adjustment as they like to say in there langage. By time you reach your broker you will be up or down.There no other place to go,your best friend broker could have stolen some of your money now to pay his expenses,depending on you to forgive him,you nice guy and the fund to protect you has a waiting list for people to get percentage back.Good luck to you lucky to have money guys. You don't have the nerve to go to your companies and complaint that not your
    your nature,you have to be a team player.MODERATORS, THESE POST ARE ABOUT OUR MONEY,NOT POLITICS PLEASE
    GIVE SOME SPACE TO VENT.
     
    Last edited: Aug 9, 2011
    Markd77 likes this.
  15. ErnieM

    AAC Fanatic!

    Apr 24, 2011
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    The biggest problem (for the politico's) is once you write off the debt you can never borrow another penny from anyone until the revolution comes, you get dumped, and the new guys get to start it all over.

    Debt is not the problem it's the symptom. Spending is the problem.
     
  16. shortbus

    AAC Fanatic!

    Sep 30, 2009
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    When you have politico's able to take bribes legally from the people that really run the country is the problem. The Supreme Court allowing and even expecting corporations to finance the elections, is a big problem. Those corporations aren't doing that out of the goodness of there hearts. They are getting something in return. The more money you make allows you to pay little or no taxes for that "privilege". Just plain wrong.

    They keep talking about the 'entitlements' to the little guy (social security, Medicare) but never mention the REAL entitlements given to the rich and richer.

    They keep saying that the world is heading toward socialism, when in reality it is Feudalism that is returning. The few Lords getting richer on the backs of the 'serfs'(middle class).
     
  17. JoeJester

    AAC Fanatic!

    Apr 26, 2005
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    Folks, this country has been in debt since it's inception in 1790.

    The closest it came to being debt free was sometime between 1800-1850.

    The largest spending spree was during FDRs administration where it peaked to 4 dollars spent for every dollar taken in. Clinton's term ended in a net loss ... more money spent than taken in during those eight years. I will give him and the republican led legislature credit for the only budget with a surplus since the Nixon administration.

    Congress, either party ... Republican or Democrat ... does not have the wherewithall to do anything about it. The "tea party" seems to care. As a country we will go from AAA to AA to A before there will be a real reform. I don't know how many remember the high inflation of the Jimmy Carter led administration.

    If this were your family, you would tighten your belt and reduce your debt ... or you could play like the government and attempt to raise your debt ceiling.
     
  18. shortbus

    AAC Fanatic!

    Sep 30, 2009
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    @ JoeJester- I must be dumb, how can you have a net loss and a surplus at the same time?

    Aren't the charts on this link the national debt? Not debt ceiling, but actual debt.
    http://en.wikipedia.org/wiki/National_debt_by_U.S._presidential_terms

    To blame Obama or any president for the debt is wrong, The debt doesn't start again at zero when a new one comes in. Bush the Second is the las one that actually started near zero.
     
  19. JoeJester

    AAC Fanatic!

    Apr 26, 2005
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    People forget the first two years of the Clinton Administration the Democratic party had control over the legislature and the executive. Spending went through the roof. Even with the couple years of a "surplus", that did not offset the "spending" that occurred in the other years of the administration.

    The chart in your link showed the Clinton Administration added 1.42 Trillion to the debt.

    The public debt has been accumulated since the inception of this country. When the Congress doesn't enact a balanced budget, for whatever reason, the debt grows.

    The last budget prior to Bush the 2nd may have been in surplus, but that didn't last long. Events of the early part of this century took hold and the spending side went nuts.

     
    Last edited: Aug 9, 2011
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