Food For Thought

parrai

This is something interesting I found while looking at at another discussion forum. Just wondering what people think of this

http://www.usdebtclock.org/world-debt-clock.html

Dannyboy83

External debt is not really an issue. It's IFSC related.
http://www.cso.ie/releasespublications/documents/economy/current/externaldebt.pdf


The public debt is atrocious but it does include our bank bailouts.
I wonder how many of those other countries have included their bank bailouts on the balance sheets?

Debtocracy

The earth owes itself quadrillions of dollars and must work very hard to pay itself back.

parrai

Would the banks starting from scratch solve this problem?

http://youtu.be/swkq2E8mswI


(Obviously this is a 2 hour documentary, but very interesting and I wouldn't expect anyone to sit through it unless they were interested)

Scofflaw

Why do people insist on looking at debt in isolation? It's meaningless to say that the world has a total debt of x, because all of that debt is owed within the world (as far as I'm aware the Martians are owed nothing).

Take a village of a hundred people, where everybody owes exactly one other person €10. Total the debt - €1000. What does that figure mean? Absolutely nothing except as a measure of the use of credit as opposed to immediate settlement. What's the real total debt of the village? Zero, because everybody is also owed €10 by one other person.

cordially,
Scofflaw

parrai

Scofflaw wrote: »

Why do people insist on looking at debt in isolation? It's meaningless to say that the world has a total debt of x, because all of that debt is owed within the world (as far as I'm aware the Martians are owed nothing).

Take a village of a hundred people, where everybody owes exactly one other person €10. Total the debt - €1000. What does that figure mean? Absolutely nothing except as a measure of the use of credit as opposed to immediate settlement. What's the real total debt of the village? Zero, because everybody is also owed €10 by one other person.

cordially,
Scofflaw

Fair enough, but what about Ireland, budgets for the next 3/5 years of 3-5 billion... Where is this money going to come from, considering that alot of people are seriously strapped as it is... I'm just wondering, not disagreeing, I'm genuinely interested in opinions...

Realistically this money will never be paid, in my opinion. Also it will, year on year keep growing.

In America, their debt is something crazy like 16/17 trillion, I don't think that will be paid either...

So would 'starting from scratch' be the answer?

Scofflaw

parrai wrote: »

Fair enough, but what about Ireland, budgets for the next 3/5 years of 3-5 billion... Where is this money going to come from, considering that alot of people are seriously strapped as it is... I'm just wondering, not disagreeing, I'm genuinely interested in opinions...

Realistically this money will never be paid, in my opinion. Also it will, year on year keep growing.

In America, their debt is something crazy like 16/17 trillion, I don't think that will be paid either...

Yes, that's almost certainly the case - but that's almost always the case anyway. States don't in general pay down their debt - they just refinance, and wait for a combination of inflation and GDP growth to make the debt less burdensome before acquiring more.

So would 'starting from scratch' be the answer?

Probably not, I think. The problem is that the debt is owed in a network. A debt reset, therefore, would involve everyone's net position suddenly becoming real, and the outcome is very complicated. The last three decades or so have seen the rise of what we might call "consumer capitalism", where nearly everyone has a finger in the pie. If you have investments, you know you're affected - your money is basically on loan to some revenue-generating enterprise, be that a business or a government - but your pension is also investment money, as is your insurance payoff, and so on, and so on. So a complete reset is going to hit nearly everyone - we might like to think of it as hitting fat capitalists who don't work for a living, but it also hits pensioners, because they also live off invested capital, and it hits those who are most prudent (and who have saved up enough to have investments) while benefiting those who are least prudent.

cordially,
Scofflaw