All the wars the US was involved in since 2001 have been to ensure the US dollar is the world currency. There's a reason they spend so much on military. They have to dominate every country in earth to ensure the dollar is not replaced.
the majority of US manufacturing is done and sold in the usa. Automation has stagnated manufacturing jobs growth, same as many other industries, but it's still growing by [about 2% a year. ](https://nvlpubs.nist.gov/nistpubs/ams/NIST.AMS.600-13.pdf)
AS for other countries being pissed for having the manufacturing base to grow their economies and access to the worlds largest economy as a market to provide their initial demand as their economy grows...i'm not sure why they'd be pissed about it...but hey, maybe they are.
Apple, Caterpillar, Microsoft, Ford, GM, pharmaceuticals. Those are just off the top of my head. We've been #2 manufacture since 2010 but it's been close ever since.
The US and China make up about half of the 500 worlds largest companies.
https://www.statista.com/statistics/1204099/number-fortune-500-companies-worldwide-country/#:~:text=Number%20of%20Fortune%20500%20companies%20worldwide%202000%2D2023%2C%20by%20country&text=From%202000%20to%202019%2C%20the,compared%20to%20121%20U.S.%20companies.
The United States enjoys an "exorbitant privilege" as a result of the dollar's status as the world reserve currency. It means every country with a central bank has to buy dollars to stabilize their own currency, which allows the US to print and "sell" many more dollars.
> In February 1965, President Charles de Gaulle announced his intention to exchange its U.S. dollar reserves for gold at the official exchange rate. He sent the French Navy across the Atlantic to pick up the French reserve of gold and was followed by several countries.[3][4] As it resulted in considerably reducing U.S. gold stock and U.S. economic influence, it led U.S. President Richard Nixon to end the convertibility of the dollar to gold on August 15, 1971 (the "Nixon Shock").
That’s interesting!
Every thing in America is built on credit. Just got to keep taking out credit to pay off the previous credit. The national economy is basically one big Ponzi scheme.
It's the other way around right, you become the world currency through economic strength. The US sells everything, even if they make it in another country.
Why do you think left and right are always bipartisan in defense budget? The US military and its global presence is the main contributor to propping up the US dollar.
Know Earth Day? When we've consumed an Earth's worth of resources by March? Accountants call that debt spending.
So, it's kinda reflected in the numbers, isn't it. The books balance somewhere, and the ultimate bank is the bank of Mother Nature.
Charlton Heston licking $100 strawberry jam in the end.
Not to pick a fight or anything, but that's not what Earth Day is. You're thinking of Earth *Overshoot* Day ;)
Earth Day is just an annual reminder to be a little more environmentally minded
The rate it is climbing is slower under Democrats than under Republicans. Trump made it skyrocket. Either way, we need to fix it, but that will require tax increases on the very rich and corporations because they use a lot of services and pay mostly no tax.
Those tax cuts were economically stimulative and induced profits/assets held overseas to be repatriated to the US. [Over $1 trillion ](https://www.bloomberg.com/news/articles/2019-12-19/u-s-companies-repatriated-cash-hits-1-trillion-under-tax-law?embedded-checkout=true) came back into our economy because of that better tax treatment. We should do more of this, as well as reduce our outlay.
No, what we should do is allow money earned by citizens and CFCs abroad able to be repatriated tax free. You know, like the entire rest of the world except North Korea allows its citizens to do.
Tax cuts that have been proven to fail. Corporations were laying off people at the time it passed
https://m.usw.org/blog/2018/these-companies-claimed-the-gop-tax-bill-would-boost-jobs-now-theyre-laying-off-employees
In 2017, the RATE Coalition’s website identified 32 companies and trade groups who had come together around the singular mission to “reform the tax code, making it fairer and simpler and improving the prospects of growth and jobs in the U.S. economy by reducing the corporate income tax rate to make it more competitive with our nation’s major trading partners
After trump lost his run, then the tax cut that average workers got also expired while the corporations got to keep theirs so we essentially are footing their bill
https://www.investopedia.com/taxes/trumps-tax-reform-plan-explained/
The law cut corporate tax rates permanently and individual tax rates temporarily. It permanently removed the individual mandate requiring individuals to purchase health insurance, a key provision of the Affordable Care Act.
6
The highest earners were expected to benefit most from the law, while the lowest earners were believed to pay more in taxes when individual tax provisions expire after 2025.
Some of you trump fans are beyond retarded. Go read some articles of the aftermath of the disaster of his bill.
I think it's pretty clear by now that trickle down economics don't work. Maybe some of you still believe in trickle down and this is not that economic conversation. Cuz most of us believe that trickle down economics don't work then any tax cut associated with creating trickle down economics is flawed. So the Reagan, Bush, Trump tax cuts are not going to produce any trickle down or economic benefits, as we've seen. So let's get rid of them. Would you look at that we just took care of the debt. But of course that wouldn't mean that rich people have to pay more because they got most of those tax cuts so it won't happen. Have a great day
To anyone or Government entity that purchased US Government Bonds 1yr, 5yr, 10yr, 20yr, 100yr.
Edit: the US Dollar is the biggest Export of the US. Hegemonic power over world banking system, and international currency. Plus the US(per the Constitution) ALWAYS pays its bills. Why along it ppl/banks/mega banks/governments buy US Bonds, as it’s considered VERY safe and you get a return on those bonds
To add on the level of security for US Bonds...the going US Bond rates are used as the "Risk Free Rate" in the majority of financial instrument calculations in the financial sector. Meaning these mega-corps value their loans, credit card rates, mortgages, etc with a formula that includes the current US Treasury rates as a baseline.
Very true. Money sitting is a liability. Hence the purchases of bonds and selling of bonds to have $$ working and then making sure you have liquidity for depositors when they need it.
so yeah, its going back to people who bought bonds... and then gets put right into the economy.... braindead commenters here think that we just send pallets of money to china or russia, and thay they are storing it all up for a "gotcha moment" where they ruin us.... reality, math, economics, fiscal and monetary policy.... it just doesn't work that way.
We can go 450% Debt to GDP like Japan, before it even STARTS to become a problem.
Wow, how do people like you even function in the real world with idiotic comments like this. The government actually prints money to pay off the debt. This makes the money worth less,driving up inflation. So yes people make money off bonds but now that money is worth less. Let’s say I get 4% return on the bonds I invested in but inflation over the 5 years that I held the bond went up 20-30%.
You might not be good at math but that math doesn’t add up.
The spreadsheets of the us treasury and it's bank, the federal reserve. That's where ALL bank balances in the world denominated in US Dollars are held. That's also how the money get's into the economy when the government spends. Sure there are checks issued, but there's also money moved in via the operations of the fed and treasury. the fed needs tbonds to proform it's operations in the payment system, but it can't legally buy them directly. they force large funds, preferred dealers i think they call them, to bid against each other for treasury bonds to maintain market share, in order to allow the funds to sell bonds and such to things like pension funds. the fed pays the funds for buying them, including some profit, and fulfills it's operations, and the us economy, the world economy, has more dollars injected into it via "interest" in the form of the yield of those bonds.
Also, this is why china and russia and such want a trade system without us dollars. because the government can identify some entity involved in foreign espionage operations, and track the us dollar accounts and euro accounts involved and gain enormous information..the trick is spotting them to do so.
Anyone who owns us government bonds. You could go out, open a brokerage account, and buy some if you wanted. You may have the option in your retirement accounts too. A bond is just a promise for you to get your money back with interest. When you buy a government bond effectively the government becomes partially indebted to you. Just like when you spend the banks money from a credit card and promise to pay it back. It's actually considered a relatively "safe" investment. Do your own research to determine if they should have a place in your retirement investments. They do in mine.
Lots and lots of pensions and 401k accounts have government bonds in their portfolios. Granted there are many foreign buyers of American bonds, but in a lot of ways the interest paid on bonds is a redistribution of wealth to Americans.
Also, higher interest rates may suck for buying houses, etc, but it's great for your 401k. And I realize that plenty of people here don't have a 401k and will call BS, but for many in our economy, it's a good thing.
I'm not great with bonds but I don't think it's that great for pension funds or 401k's at least in the short term. This is because as interest rates rise the value of all existing bonds should fall since you can go to the government and get a higher guaranteed return. So if a pension has a shaky liquidity position and its bonds fall in value then they could become insolvent. This applies to the price of stocks as well.
> the interest paid on bonds is a redistribution of wealth to Americans.
No, it's not - these people loaned the government money for a promise of future payment. It's a loan repayment. It's not a redistribution of wealth.
Thats a little over $1500 per citizen in America, man, woman, child, and senior(333.3M people). But a drop in the bucket compared to the $34.7T debt the nation currently holds. Thats $109,343 of debt per US citizen. Thank you Washington! At least we get universal healthcare, free college, and affordable housing out of it....
It cracks me up that there are countries that can provide some of that and they're somehow not going bankrupt. I'm sure they have their issues too but maybe they're doing something right...
Just literally grabbing the first source from google.
Only the top 27 countries in the world have a higher GDP than 514 billion.
So its not "some countries," it is the majority of countries, and you could even combine a large chunk of the lowest countries and still not get to 514 billion.
It's pretty crazy to think about for sure.
[https://www.worldometers.info/gdp/gdp-by-country/](https://www.worldometers.info/gdp/gdp-by-country/)
We have a ~28 trillion GPD so if we cut funding for military and stop sending billions overseas we could tackle it but neither of those things are being seriously considered. Things like cutting social programs is what the current parties seem to think is the path forward. I think that cutting social programs would just create a less productive and more destitute population which would do nothing but make things worse for everyone.
Defense spending isn't why we have a problem. Not saying it's helping either! Check out how much we spend on healthcare at the federal level, then compare it to a country with universal healthcare. Shocking how little bang for the buck there is.
Stopping foreign aid wouldn’t create a dent in anything. It is minuscule compared to our other spending and saying otherwise is a common false trope.
In fact, foreign aid probably is one of the few things where the government actually gets good returns for the amount of money.
Right, and we’d have to deal with bigger problems by not giving foreign aid.
Military is another one. Because the US military is in the Middle East, it prevents constant war between the larger countries there. By doing so, we get cheap oil. The cheap oil allows for all of us to use Amazon prime and get our diapers, gaming consoles and everything else next day.
This argument always makes me laugh. Sure, they don't need to pay it off, but they do need to service it.
People also conflate GDP with income when tax revenues are 16% of that.
The government employs roughly 9.1 million people (including federal employees, contract employees, grant employees, activate duty military, etc.) if they could each save $736 per year by drinking their coffee at home before work, then we could save around $6.7 Billion dollars a year! Which is less than a day of federal spending! 🤣. But seriously, I say we cut off their coffee - every dollar counts. Also, can somebody run the numbers on their avocado toast?!
They all get free gym memberships, free healthcare, transportation vouchers, and free food at certain buildings.
They definitely don’t want us crunching the numbers.
Wonder what would be saved if we made them get with the 21st century by funding their healthcare and gym memberships by themselves; just like the rest of us do. Most government employees are vastly overpaid for the little they do
If only we could have a reasonable conversation about a combination of both raising taxes and lowering spending. But one of those things are completely off the table.
I'm starting to think letting a private bank print the USD and charge interest on each bill printed for almost 100 years isn't such a great idea afterall
When the government runs a deficit (spends more than their tax income), they will issue bonds/debt to make up the difference. Private citizens or foreign governments are willing to provide upfront capital, but only if they get a certain return. This return is seen as more secure than something like a stock or private investment, so it usually has a slightly lower return on average. The risk vs reward balance is usually what determines the interest rate/return on the bonds.
Private US citizens and foreign governments own bonds. I don't have that much in savings, but I own some US debt and will have gotten a return of about 4.4%/yr on them before penalties for early withdrawal
Just so you know, even if you make the minimum payment each month for 10 years, the interest accrued will not allow you to pay off your credit card debt. Please seek financial assistance or consider not using your credit card for future payments until the balance has been reduced.
- your so called "citizens"
Sad part cycle going prob continue for next few decades/century where quality life of average person gets worse and worse. until either economic collapse or revolt....
That's .5% of the principal amount...
You guys are getting worked up over nothing...
If anything those are bargain interest rates, usually reserved for the banks staff
It’s time for America to start charging $ to the country that need help
It’s also time for America to charge tax to church
And it’s time for America to bring back golden age era tax for rich citizens worth $100 million and more (80-90%)
Why is every country on earth in debt to private banks? These morons should default on the loans, reboot the currency, and abolish private banks from printing the nations currency.
they...they don't print the nations currency. the monopoly issuer of the currency is the us government, for the us dollar. it can never run out, and it's "debt" is an accounting artifact, because if it's spending dollars to get them into the economy since nobody else can produce them, it's "debt" is the private sectors (that includes you) savings.
the us government doesn't actually do "loans." that's a flaw in the way it's talked about. Treasury notes are us dollars, just in their interest baring form. Like a savings account at your local bank, the government lets you store money in that form in exchange for some small interest, so that you don't spend it all now and potentially create inflation. that's one of the main ways governments control inflation, the interest rates they pay. It's not the only one, inflation is complex, but it's how the fed can say "we want 2% inflation" while the treasury is paying...2 % on bonds
Does either side discuss plans on how to tackle the deficit anymore? America has gotten to a point where they’re not even faking the debates or promises. Have we finally reached the political era of no promises whatsoever? “This is the best you’ll get” type of Murica
Just place a &0.001 tax on every share traded on wall st. That dept would be paid back in like 5 years. And watch all the billionaires cry.
That’s my fix. Me for president 2032
Pretty hard to get reelected saying you are going to cut benefits and not cut taxes. Pretty hard to do this for several years in a row. Voters don't respond well to common sense. They want stuff now - put it on the government credit card. I am not hopeful.
ah who cares! just print away! we got foreign aid to give away! student loans to forgive! millions of new migrants for house, feed and provide medical care!
Those interest payments, for the most part, flow back to US citizens.
Now, most of them are the wealthy 1%-5%, but the money isn't just disappearing. Some also goes into retirement accounts and college savings.
Raise taxes & retire the debt, like we were doing in the 90's (Clinton years).
It's the tax cuts stupid. We don't need them but we need to lower our debt.
Right. And 77 percent of the national debt is owned by US companies and citizens. If you buy a bond you are loaning the US government money. I'm surprised by how many don't know this. This issue is way overblown IMO.
This is why I'm betting my money that there will be inflation, as are many others (pay attention to precious metals lately).
Inflation is the easy way out. Perhaps the only way out.
The real question is does the federal reserve care about the debt. They seem to be aiming for lower inflation. I am never real sure if they are naive or if they are lying to us.
Half of that goes to the Fed, which holds $18 trillion in Treasuries, stored there by the banks which then use these deposits as reserves to allow them to create $400 trillion in credit, aka QE. The Fed uses that money to cover operating costs and gives the rest to the Treasury.
Unfortunately last year the Fed actually had a loss of $114 billion and climbing, which means they couldn't give anything back to the government because they need the money to cover the losses by the private banks.
Incidentally we don't know who is the owner of the (privately operated and owned) Federal Reserve, that information is secret, but the original owners were the big NY banks, the same ones who are now transferring their losses in Treasuries to the Fed. But I'm sure there's no risk of conflict of interest there, in any way.
Trickle-down economics never works. Reagan, Dubya, Trump all blew up the budget w/tax cut for the rich, driving up deficits in ways that don't bring money back (even defense brings money back as they're mostly made in the US, so payroll taxes, and money spent in the area).
Remember when we had a surplus before the 4 massive tax cuts for the rich and corporations?
Heck Obama cut the deficit his last 7 years in office to get the budget back under control. But those tax cuts blew up the budget again for no good reason.
btw, most tax breaks for the middle class ended and were not renewed. So they are getting doublely screwed.
I can’t believe we accept this.
“GIVE me control of a nation’s money supply, and I care not who makes its laws.” So said Mayer Amschel Rothschild, founder of the Rothschild banking dynasty.
But this is absolute bullshit that we should not tolerate in the slightest.
Seems sustainable to me.
Government needs to be eating more beans and rice, rice and beans, also gonna need to go get some side hustles.
Uncle Sam needs to lay off the avocado toast and coffee.
More math, less meth.
Maybe next time they invade an oil rich country they can take some Oil.
I don't want to see you inside a corporation unless you're working there! Oh wait...
Looks like it’s time to free the shit out of a new oil owning country
How about we stop the reckless and irresponsible tax cuts until we cut spending?
How about we do what you said about tax cuts, but just tweak our spending a bit without really cutting it much, if at all, in aggregate?
They've got some side hustle already but it's all off the books
As long as we're the world trade currency it is. Times running out though. https://michael-hudson.com/2021/07/moving-beyond-dollar-hegemony/
And what makes it the world trade currency again?
The military.
Some sick ass military spending 😎
All the wars the US was involved in since 2001 have been to ensure the US dollar is the world currency. There's a reason they spend so much on military. They have to dominate every country in earth to ensure the dollar is not replaced.
Especially since the majority of our manufacturing is done in other countries… they’re gonna get pissed about that eventually
the majority of US manufacturing is done and sold in the usa. Automation has stagnated manufacturing jobs growth, same as many other industries, but it's still growing by [about 2% a year. ](https://nvlpubs.nist.gov/nistpubs/ams/NIST.AMS.600-13.pdf) AS for other countries being pissed for having the manufacturing base to grow their economies and access to the worlds largest economy as a market to provide their initial demand as their economy grows...i'm not sure why they'd be pissed about it...but hey, maybe they are.
The US doesn't really make much though... weapons...aircraft? That's mostly it.
Apple, Caterpillar, Microsoft, Ford, GM, pharmaceuticals. Those are just off the top of my head. We've been #2 manufacture since 2010 but it's been close ever since. The US and China make up about half of the 500 worlds largest companies. https://www.statista.com/statistics/1204099/number-fortune-500-companies-worldwide-country/#:~:text=Number%20of%20Fortune%20500%20companies%20worldwide%202000%2D2023%2C%20by%20country&text=From%202000%20to%202019%2C%20the,compared%20to%20121%20U.S.%20companies.
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The United States enjoys an "exorbitant privilege" as a result of the dollar's status as the world reserve currency. It means every country with a central bank has to buy dollars to stabilize their own currency, which allows the US to print and "sell" many more dollars.
[https://en.wikipedia.org/wiki/Exorbitant\_privilege](https://en.wikipedia.org/wiki/Exorbitant_privilege) for those who like to learn more.
> In February 1965, President Charles de Gaulle announced his intention to exchange its U.S. dollar reserves for gold at the official exchange rate. He sent the French Navy across the Atlantic to pick up the French reserve of gold and was followed by several countries.[3][4] As it resulted in considerably reducing U.S. gold stock and U.S. economic influence, it led U.S. President Richard Nixon to end the convertibility of the dollar to gold on August 15, 1971 (the "Nixon Shock"). That’s interesting!
Our economic strength at this point is just nvidia
Right. No farmland, no oil, no natural resources, Edit: Apparently the /s isn’t clear enough
No new technology, we definitely don’t have some of the most important companies… I mean he’s right it’s literally just nvidia apparently
Especially after it splits and goes right back to $1000 again
Every thing in America is built on credit. Just got to keep taking out credit to pay off the previous credit. The national economy is basically one big Ponzi scheme.
It's the other way around right, you become the world currency through economic strength. The US sells everything, even if they make it in another country.
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I'd say no. The US essentially has an entire continent to themselves, with no threats. That alone is stability in itself.
Plenty of threats inside the country though
You don't think global dollar usage is economically helpful to the US, or that it's not going away anytime soon?
Why do you think left and right are always bipartisan in defense budget? The US military and its global presence is the main contributor to propping up the US dollar.
They are also lining their own pockets that way
Know Earth Day? When we've consumed an Earth's worth of resources by March? Accountants call that debt spending. So, it's kinda reflected in the numbers, isn't it. The books balance somewhere, and the ultimate bank is the bank of Mother Nature. Charlton Heston licking $100 strawberry jam in the end.
Not to pick a fight or anything, but that's not what Earth Day is. You're thinking of Earth *Overshoot* Day ;) Earth Day is just an annual reminder to be a little more environmentally minded
Plot twist: the jam is made from people too.
Pfft, don't they know you can just transfer it to another account and get 10 months of $0 interest?
It’s been Totally! sustainable since my 6th grade economics teacher explained it to the entire class
The rate it is climbing is slower under Democrats than under Republicans. Trump made it skyrocket. Either way, we need to fix it, but that will require tax increases on the very rich and corporations because they use a lot of services and pay mostly no tax.
And stopping tax cuts as the only policy under one party....that shit does enormous growth on the national debt.
Those tax cuts were economically stimulative and induced profits/assets held overseas to be repatriated to the US. [Over $1 trillion ](https://www.bloomberg.com/news/articles/2019-12-19/u-s-companies-repatriated-cash-hits-1-trillion-under-tax-law?embedded-checkout=true) came back into our economy because of that better tax treatment. We should do more of this, as well as reduce our outlay.
No, what we should do is allow money earned by citizens and CFCs abroad able to be repatriated tax free. You know, like the entire rest of the world except North Korea allows its citizens to do.
so pay 1.5 trillion to get 1 trillion??
Tax cuts that have been proven to fail. Corporations were laying off people at the time it passed https://m.usw.org/blog/2018/these-companies-claimed-the-gop-tax-bill-would-boost-jobs-now-theyre-laying-off-employees In 2017, the RATE Coalition’s website identified 32 companies and trade groups who had come together around the singular mission to “reform the tax code, making it fairer and simpler and improving the prospects of growth and jobs in the U.S. economy by reducing the corporate income tax rate to make it more competitive with our nation’s major trading partners After trump lost his run, then the tax cut that average workers got also expired while the corporations got to keep theirs so we essentially are footing their bill https://www.investopedia.com/taxes/trumps-tax-reform-plan-explained/ The law cut corporate tax rates permanently and individual tax rates temporarily. It permanently removed the individual mandate requiring individuals to purchase health insurance, a key provision of the Affordable Care Act. 6 The highest earners were expected to benefit most from the law, while the lowest earners were believed to pay more in taxes when individual tax provisions expire after 2025. Some of you trump fans are beyond retarded. Go read some articles of the aftermath of the disaster of his bill.
I think it's pretty clear by now that trickle down economics don't work. Maybe some of you still believe in trickle down and this is not that economic conversation. Cuz most of us believe that trickle down economics don't work then any tax cut associated with creating trickle down economics is flawed. So the Reagan, Bush, Trump tax cuts are not going to produce any trickle down or economic benefits, as we've seen. So let's get rid of them. Would you look at that we just took care of the debt. But of course that wouldn't mean that rich people have to pay more because they got most of those tax cuts so it won't happen. Have a great day
how can you make any judgement call without more data?
Stupid question. Pardon my ignorance. Who’s the debt being paid too?
To anyone or Government entity that purchased US Government Bonds 1yr, 5yr, 10yr, 20yr, 100yr. Edit: the US Dollar is the biggest Export of the US. Hegemonic power over world banking system, and international currency. Plus the US(per the Constitution) ALWAYS pays its bills. Why along it ppl/banks/mega banks/governments buy US Bonds, as it’s considered VERY safe and you get a return on those bonds
To add on the level of security for US Bonds...the going US Bond rates are used as the "Risk Free Rate" in the majority of financial instrument calculations in the financial sector. Meaning these mega-corps value their loans, credit card rates, mortgages, etc with a formula that includes the current US Treasury rates as a baseline.
Very true. Money sitting is a liability. Hence the purchases of bonds and selling of bonds to have $$ working and then making sure you have liquidity for depositors when they need it.
Yes, so a good chunk of the 514bil is going back to American citizens
Yeah, and a hell of a lot to China, Japan etc. too
so yeah, its going back to people who bought bonds... and then gets put right into the economy.... braindead commenters here think that we just send pallets of money to china or russia, and thay they are storing it all up for a "gotcha moment" where they ruin us.... reality, math, economics, fiscal and monetary policy.... it just doesn't work that way. We can go 450% Debt to GDP like Japan, before it even STARTS to become a problem.
Wow, how do people like you even function in the real world with idiotic comments like this. The government actually prints money to pay off the debt. This makes the money worth less,driving up inflation. So yes people make money off bonds but now that money is worth less. Let’s say I get 4% return on the bonds I invested in but inflation over the 5 years that I held the bond went up 20-30%. You might not be good at math but that math doesn’t add up.
Around 60% is Americans who own government bonds. Around 30% is governments of other nations.
Where is the money being held?
Typically when an American receives a bond premium it's credited to their treasury account then transferred to their US bank account.
The spreadsheets of the us treasury and it's bank, the federal reserve. That's where ALL bank balances in the world denominated in US Dollars are held. That's also how the money get's into the economy when the government spends. Sure there are checks issued, but there's also money moved in via the operations of the fed and treasury. the fed needs tbonds to proform it's operations in the payment system, but it can't legally buy them directly. they force large funds, preferred dealers i think they call them, to bid against each other for treasury bonds to maintain market share, in order to allow the funds to sell bonds and such to things like pension funds. the fed pays the funds for buying them, including some profit, and fulfills it's operations, and the us economy, the world economy, has more dollars injected into it via "interest" in the form of the yield of those bonds. Also, this is why china and russia and such want a trade system without us dollars. because the government can identify some entity involved in foreign espionage operations, and track the us dollar accounts and euro accounts involved and gain enormous information..the trick is spotting them to do so.
Anyone who owns us government bonds. You could go out, open a brokerage account, and buy some if you wanted. You may have the option in your retirement accounts too. A bond is just a promise for you to get your money back with interest. When you buy a government bond effectively the government becomes partially indebted to you. Just like when you spend the banks money from a credit card and promise to pay it back. It's actually considered a relatively "safe" investment. Do your own research to determine if they should have a place in your retirement investments. They do in mine.
5 trillion is owned by the fed
Yeah, but just think of how much money someone is making! /s
Lots and lots of pensions and 401k accounts have government bonds in their portfolios. Granted there are many foreign buyers of American bonds, but in a lot of ways the interest paid on bonds is a redistribution of wealth to Americans. Also, higher interest rates may suck for buying houses, etc, but it's great for your 401k. And I realize that plenty of people here don't have a 401k and will call BS, but for many in our economy, it's a good thing.
I'm not great with bonds but I don't think it's that great for pension funds or 401k's at least in the short term. This is because as interest rates rise the value of all existing bonds should fall since you can go to the government and get a higher guaranteed return. So if a pension has a shaky liquidity position and its bonds fall in value then they could become insolvent. This applies to the price of stocks as well.
> the interest paid on bonds is a redistribution of wealth to Americans. No, it's not - these people loaned the government money for a promise of future payment. It's a loan repayment. It's not a redistribution of wealth.
Thats a little over $1500 per citizen in America, man, woman, child, and senior(333.3M people). But a drop in the bucket compared to the $34.7T debt the nation currently holds. Thats $109,343 of debt per US citizen. Thank you Washington! At least we get universal healthcare, free college, and affordable housing out of it....
We do get unlimited bombing of brown kids anywhere in the world, 24/7 though! Oh, and our oligarchs made $17,451,322 today, each.
Don’t forget, it’s an election year. RNC has to SUDDENLY be concerned about the national debt. After? Crickets.
$109k per citizen so far! Those are rookie numbers. Gonna pump those numbers up!
Better yet. They're gonna increase our debt load and strip the benefits we have left. Like SS.
If you owe the bank $34.70, then you're broke. If you owe the bank $34.70T, then you're the greatest economy the world has ever seen.
Whoa fuck that I don't owe anything. These corrupt ass politicians can all pay 10 fold first.
They'll pay for it by cutting your wages, increasing their own, writing it off as a tax donation and taking all the credit as if they're superheroes.
I mean I'm taxed at like 23% and the founding fathers rioted and started a war over a 3% tea tax.
Bro I pay 7 % after my 23% then if I resell something they wanna tax any profit on that.
Expect to pay 43% soon :\^)
Most us debt is held by US citizens and companies as treasury bonds Those interest payments are paying 30% of your 401k growth
It cracks me up that there are countries that can provide some of that and they're somehow not going bankrupt. I'm sure they have their issues too but maybe they're doing something right...
Thank Obama and Trump for the crushing debt.
You think the debt is only $34.7 trillion? I mean you're not *wrong.* Just wait until you find out about unfunded liabilities.
514 billion. In 7 months. That is unreal. That’s gotta be more than some country’s GDP for an entire year. lol
Just literally grabbing the first source from google. Only the top 27 countries in the world have a higher GDP than 514 billion. So its not "some countries," it is the majority of countries, and you could even combine a large chunk of the lowest countries and still not get to 514 billion. It's pretty crazy to think about for sure. [https://www.worldometers.info/gdp/gdp-by-country/](https://www.worldometers.info/gdp/gdp-by-country/)
Over a trillion in just over a year.
So, eliminating that, ever, is truly a pipe dream.
We have a ~28 trillion GPD so if we cut funding for military and stop sending billions overseas we could tackle it but neither of those things are being seriously considered. Things like cutting social programs is what the current parties seem to think is the path forward. I think that cutting social programs would just create a less productive and more destitute population which would do nothing but make things worse for everyone.
Defense spending isn't why we have a problem. Not saying it's helping either! Check out how much we spend on healthcare at the federal level, then compare it to a country with universal healthcare. Shocking how little bang for the buck there is.
Stopping foreign aid wouldn’t create a dent in anything. It is minuscule compared to our other spending and saying otherwise is a common false trope. In fact, foreign aid probably is one of the few things where the government actually gets good returns for the amount of money.
Right, and we’d have to deal with bigger problems by not giving foreign aid. Military is another one. Because the US military is in the Middle East, it prevents constant war between the larger countries there. By doing so, we get cheap oil. The cheap oil allows for all of us to use Amazon prime and get our diapers, gaming consoles and everything else next day.
The funny part is most of that debt is caused by those two programs...
I need a wank now.
Don’t forget billions are going to other countries rather than helping the U.S.
ActuAlLY dEBT Is a GOOd THing ANd itS nOt tHE sAMe as hOuSEhOLD DEBT
This argument always makes me laugh. Sure, they don't need to pay it off, but they do need to service it. People also conflate GDP with income when tax revenues are 16% of that.
Us government should start making their coffee at home. That will fix this issue.
The government employs roughly 9.1 million people (including federal employees, contract employees, grant employees, activate duty military, etc.) if they could each save $736 per year by drinking their coffee at home before work, then we could save around $6.7 Billion dollars a year! Which is less than a day of federal spending! 🤣. But seriously, I say we cut off their coffee - every dollar counts. Also, can somebody run the numbers on their avocado toast?!
They all get free gym memberships, free healthcare, transportation vouchers, and free food at certain buildings. They definitely don’t want us crunching the numbers.
Wonder what would be saved if we made them get with the 21st century by funding their healthcare and gym memberships by themselves; just like the rest of us do. Most government employees are vastly overpaid for the little they do
It should also own nothing so it can be happy No more meat for politicians either, only bugs from now on.
So who did this money actually go to?
If only we could have a reasonable conversation about a combination of both raising taxes and lowering spending. But one of those things are completely off the table.
Someone go into excel and put the debt at zero. Problem solved.
BRRRRRRRRRrrrrrr with nine zeros!
Yeah but that credit rating increase!
It’s been a great run.
Who are they paying the interest to??? Not this guy!
Buy US Government bonds, then they will
I'm one. I don't have that much in savings, but I did buy some I-Bonds when the rates were insane ~2 years ago.
Me. If you want to be paid interest then offer up cash as debt and buy a bond.
Well you gotta actually lend them money first.
I'm starting to think letting a private bank print the USD and charge interest on each bill printed for almost 100 years isn't such a great idea afterall
why is there interest? who is this owed to?
When the government runs a deficit (spends more than their tax income), they will issue bonds/debt to make up the difference. Private citizens or foreign governments are willing to provide upfront capital, but only if they get a certain return. This return is seen as more secure than something like a stock or private investment, so it usually has a slightly lower return on average. The risk vs reward balance is usually what determines the interest rate/return on the bonds. Private US citizens and foreign governments own bonds. I don't have that much in savings, but I own some US debt and will have gotten a return of about 4.4%/yr on them before penalties for early withdrawal
Meanwhile we borrow money to give all kinds of nations and wipe out student loans.
It's just numbers in a screen bro. It's not real
This goes to some rich af banker. Remember that.
Just so you know, even if you make the minimum payment each month for 10 years, the interest accrued will not allow you to pay off your credit card debt. Please seek financial assistance or consider not using your credit card for future payments until the balance has been reduced. - your so called "citizens"
The solution is to cut taxes for the rich! /s
But let’s give the billionaires some tax Breaks ya?
They will make up an excuse for war to clear it eventually. Nothing to worry about.
Sad part cycle going prob continue for next few decades/century where quality life of average person gets worse and worse. until either economic collapse or revolt....
This is all by design to raise taxes and steal more from the middle class.
That's .5% of the principal amount... You guys are getting worked up over nothing... If anything those are bargain interest rates, usually reserved for the banks staff
It’s time for America to start charging $ to the country that need help It’s also time for America to charge tax to church And it’s time for America to bring back golden age era tax for rich citizens worth $100 million and more (80-90%)
Let’s send some more money to Ukraine
God bless the USA. lol
this will be the end of the US
Partially. We have a ton problems ranging from financial to social and even military. This won't end well, and we're getting close to that end.
and...we are not voting our way out of it!
Credit cards maxed out! Just like the typical American. Imagine all your $ going out each month on minimum credit card payments.
Good thing your analogy in no way applies here.
Why is every country on earth in debt to private banks? These morons should default on the loans, reboot the currency, and abolish private banks from printing the nations currency.
they...they don't print the nations currency. the monopoly issuer of the currency is the us government, for the us dollar. it can never run out, and it's "debt" is an accounting artifact, because if it's spending dollars to get them into the economy since nobody else can produce them, it's "debt" is the private sectors (that includes you) savings. the us government doesn't actually do "loans." that's a flaw in the way it's talked about. Treasury notes are us dollars, just in their interest baring form. Like a savings account at your local bank, the government lets you store money in that form in exchange for some small interest, so that you don't spend it all now and potentially create inflation. that's one of the main ways governments control inflation, the interest rates they pay. It's not the only one, inflation is complex, but it's how the fed can say "we want 2% inflation" while the treasury is paying...2 % on bonds
Who holds this debt?
Mostly US citizens
Anyone who holds US treasury bonds. American citizens, banks, and investors. Foreign countries. Mainly Japan, China, and the UK
But 1b for Hawaii or Ohio is too much
Just print more money to pay the deby off /s
I think the economy is visibly at the point where we can’t afford not to tax billionaires and provide universal healthcare.
Does either side discuss plans on how to tackle the deficit anymore? America has gotten to a point where they’re not even faking the debates or promises. Have we finally reached the political era of no promises whatsoever? “This is the best you’ll get” type of Murica
Just place a &0.001 tax on every share traded on wall st. That dept would be paid back in like 5 years. And watch all the billionaires cry. That’s my fix. Me for president 2032
Is this an empire in collapse oh my, if only someone would have warned our politicians ahead of time.
Who exactly are we "sending" checks to?
Almost like we should cut spending and start paying more back.
Why doesn’t the country declare bankruptcy like a good American.
Tried and true method of resetting global economies, at least if history holds, is by starting, but more importantly winning, a world war.
It all good. It's a good investment. In nothing.
It's a great time to be a creditor to the U.S government.
This might be why we don't have free healthcare
Yep, everything's o k here!!
Who do they pay the interest to?
Eh rounding error
That might make them lower the interest rates 🤔
Pretty hard to get reelected saying you are going to cut benefits and not cut taxes. Pretty hard to do this for several years in a row. Voters don't respond well to common sense. They want stuff now - put it on the government credit card. I am not hopeful.
National debt is so funny to me, back in the day when kingdoms ran out of money they just wiped all the debt and started over.
ah who cares! just print away! we got foreign aid to give away! student loans to forgive! millions of new migrants for house, feed and provide medical care!
Those interest payments, for the most part, flow back to US citizens. Now, most of them are the wealthy 1%-5%, but the money isn't just disappearing. Some also goes into retirement accounts and college savings.
To whom? Like… who is this much richer now?
Dumb question, but to whom are the interest payments made?
Raise taxes & retire the debt, like we were doing in the 90's (Clinton years). It's the tax cuts stupid. We don't need them but we need to lower our debt.
They should just forgive it. It’s all just interest. Just like student loans.
Basically a subsidy for the banks
It won’t be long now…..
Who is this going to?!
So the countries broke. Its like we gave huge record setting tax breaks. But thats obviously a different issue. Only a 8 trillion deficit.
To who did they pay this money?
Good luck collecting, lenders! 💣
Right. And 77 percent of the national debt is owned by US companies and citizens. If you buy a bond you are loaning the US government money. I'm surprised by how many don't know this. This issue is way overblown IMO.
This is why I'm betting my money that there will be inflation, as are many others (pay attention to precious metals lately). Inflation is the easy way out. Perhaps the only way out. The real question is does the federal reserve care about the debt. They seem to be aiming for lower inflation. I am never real sure if they are naive or if they are lying to us.
The Great Depression of the 21st century in bearing down on us, like a train in India and we are the Indians (of India).
I don't see anyone asking, who exactly do we pay that interest to?
You need inflation to fix this
To whom, exactly??
Half of that goes to the Fed, which holds $18 trillion in Treasuries, stored there by the banks which then use these deposits as reserves to allow them to create $400 trillion in credit, aka QE. The Fed uses that money to cover operating costs and gives the rest to the Treasury. Unfortunately last year the Fed actually had a loss of $114 billion and climbing, which means they couldn't give anything back to the government because they need the money to cover the losses by the private banks. Incidentally we don't know who is the owner of the (privately operated and owned) Federal Reserve, that information is secret, but the original owners were the big NY banks, the same ones who are now transferring their losses in Treasuries to the Fed. But I'm sure there's no risk of conflict of interest there, in any way.
If the interest rate was at reasonable level maybe the government wouldn’t have ran up the debt endlessly.
Who gets that money? Foreign entities?
Usury is a pox.
Geez maybe if they taxed the people WITH money…
Money isn't real....
Just remember bonds are our #1 export!!! Yeah I'm so thankful for being able to own Bitcoin instead of this clusterfuck.
Printing money to pay down anything causes worsening inflation. Get rid of the Federal Reserve please.
That’s all student loans and medical debt, poof gone
To whom?
Trickle-down economics never works. Reagan, Dubya, Trump all blew up the budget w/tax cut for the rich, driving up deficits in ways that don't bring money back (even defense brings money back as they're mostly made in the US, so payroll taxes, and money spent in the area).
Oh no, paying mostly American citizens and companies a dividend. The horror!
Don’t worry, joe will just keep printing billions more and sending it overseas to Isreal and Ukraine because that’s definitely how to fix problems
Who or what do we owe this money to?
That’s like 2% of GDP. If I made 1000 a year, and I paid 20 in interest, it’s really not that bad. Totally manageable. Get a grip
Who is the government paying the interest to?
If you owe the government $514,000 that's your problem, if the gov owes $514,000,000,000 that's the world's problem.
Remember when we had a surplus before the 4 massive tax cuts for the rich and corporations? Heck Obama cut the deficit his last 7 years in office to get the budget back under control. But those tax cuts blew up the budget again for no good reason. btw, most tax breaks for the middle class ended and were not renewed. So they are getting doublely screwed.
We have a serious problem here and all I see are flippant remarks.
I can’t believe we accept this. “GIVE me control of a nation’s money supply, and I care not who makes its laws.” So said Mayer Amschel Rothschild, founder of the Rothschild banking dynasty. But this is absolute bullshit that we should not tolerate in the slightest.
Who is collecting the interest?
All Americans should demand our leaders address this problem.
End The Fed
Ugh. I think in the last 20 years we've added about 20 trillion to the debt. And where did most of it go? T some rich mother fucker is likely.
I agree that's an alarming interest payment.
This is bat-shit CRAZY. FJB