What inherits Obama
The other day I read that the American figure that the state is being spent on trying to resolve the financial crisis is already 2.7 billion dollars, and that in a country that already, even before all this and much needed money. He also knew the number of jobs: 524 thousand new unemployed in two months. And I began to search for information on the actual state of U.S. finances. Let a couple of numbers and put all the zeros, that more than a trillion translates as billions and trillions when we lees and I had to document only on American websites:
- A day on November 11 at 09.14, the debt is U.S. $ 10.635.794.969.002, an amount that is increasing second to second, and in fact there is a ticking clock that will (http://en.wikipedia.org/wiki / National_Debt_Clock) and discussed here not long ago that going from 9 billion to 10 had to fix it. Currently 500.000.000.000 is increasing each month since October, a figure of growth that is expected to be sharply reduced because it is what they grew on average annually since 2003. In September the U.S. government expanded, very appropriately, the limit of indebtedness from 10.6 trillion to 11.3 but everything points that will run short in 2009
- The estimated GDP-American 2007 is 13,800,000,000,000, then the current debt is around 75% of GDP and it seems to get worse closer to 90% only by increasing the debt if we have to account that GDP may actually be reduced if there is recession, this could be even worse. They are not the all-time highs as can be seen in figure but let's remember that it was exceeded 100% due to World War II:
However, many countries are worse off and for years (from among the "big" Japan is close to 200%, in Europe and Italy, Belgium and Greece around 100%) the big problem is that this is only the debt State that is a fraction of the total debt of banks, families and American companies estimate is about 50,000,000,000,000, almost 5 times more than the public and more than 3 times the entire GDP. In Spain, where we have this sense of indebtedness total private debt is double the GDP.
How have you been able to reach these dizzying figures? Perhaps the key is in the amount of derivatives that have been negotiated without a real basis which resulted in no longer a giant bubble, besides the erroneous impression that he had had more liquidity than money, the exact value of derivatives in 2006 was 10 times more than the GDP:
And so the housing bubble has helped enormously:
These data are known and yet are consistent with a stronger donate, as can be seen in this graph of the dollar Index, which attempts to measure the value of the dollar against major currencies:
Why? One reason may be that mistrust is global economic and all countries have problems with what positions to take any currency, the better it is the country's strongest. And a half years in the risk premium on U.S. debt to 10 years has risen from 0.016% to 0.4%, is a lot but it is the least that has grown all around the world, this demonstrates confidence in the country despite the volume their debts. Another may be closely related to interest rates. The logic is that the investor will flee from low yields and the EDF has placed the rates at 1% and discounted most downs, that should go against the dollar. Not so, the first to be more volatile because the currency you the type of debt, more interested in the strength of those who the profitability of this and the second thing is that the rate at which the FED injected liquidity to commercial banks and otherwise the price we must pay the U.S. Treasury to attract investors (necessarily foreigners, there would not be enough to nationals) so that you buy so many paper coupons annually by over 3 to 4% in emissions to 10, 20, 30 years. To make matters worse, you must pay interest on all debt issued at rates much higher during these years.
A long but it is impossible to predict short-term loss is important to finance USA. In the short term also will be felt less tax revenue because corporate profits have fallen and unemployment has risen ... How are you going to get out of the pothole the U.S. economy if all indications are that everything will come worse in these next few months? Is a strong dollar for much longer? Where to get funding for the Administration Obama social reforms that he promised? Too many unanswered questions ... Do not be pessimistic and try to take it with humor ...
Droblo written by the November 11, 2008 with 243 points.
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# 1, Anonymous
Good morning
Large (and heavy) article