Wednesday, 3 August 2011

the debt ceiling... or stop the world I want to get off

Finally the USA government have raised the debt ceiling - I have no idea if that is a good or a bad idea, frankly because I can't even get my head around the numbers.  It was raised by $2.4tn... tn?  Yes not m (million) not bn (billion) but a trillion.  What is a trillion?  It is 12 zeros.  12 zeros!!!  Let us write out that number long hand then...


The mind boggles I can't really cope with that the number is in my simple brains terms stonkingly big.  Oh note that was the incremental rise, i.e. that was how much extra they wanted to borrow.  Go to your bank and ask to raise your overdraft by that amount!!!  The new USA federal government debt is therefore now $16.7tn.  The mind boggles.  Frankly what the hell do they spend it on?  Trying to visualise this in my head led me to think the opposite about small things - say an atom.  (Dubious research note here - I got a lot of this info off Yahoo Answers).  250,000,000 atoms all lined up is apparently 1 inch so 16.7tn atoms is 66,800 inches which is just over a mile.  Given you or I have never seen an atom with our naked eye that is amazing!

The whole thing is completely funny money.  I have worked for large companies before one of which once completed a take over of a rival for somewhere north of $60bn which is a number I can't compute in my head. But $16.7tn -


sorry brain overload point.

Here's the next funny thing with it.  Who is this money owed to?  Some commercial banks... but hang on who bailed them all out a couple of years ago.  So the government borrows money from the banks to prop the banks up?  Well in some ways... er... yes.  But some is owed to other countries, i.e. China is owed 6% of the USA debt.  So if the USA didn't pay up could the Chinese send in the bailiff to ask for "goods and property to the value of"?  I think that means they can have Rhode Island and Minnesota (give or take)!

But now here's the best bit I heard on the radio that over 50% of this debt is owed to the pension funds since they want a fair chunk of their money in rock solid investments that will only go up not down and which the debtor has the highest credit rating you could hope for.  So who owns the pension funds?  Surely it is the people as the money is for them and deposited by them or on their behalf by the company they work for.  So the government really owes all this money to the people - the people that they are taxing to pay back the debt.  Confused?!

What an utter mess.  How the hell will they ever ever be able to pay it all back but if they say "you know what we can't pay this" then modern society meltdown.  Although part of me wonders if that wouldn't be a bad thing and we all just stop and look at how we are using the greatest technological age of man to date and stand back from it all.  People again dying in Africa - we pour more food in there for the timebeing but is the answer to invest in a new agriculture model there... or is the answer to strip down the artificial national boundaries created by Europe's land grabbing greed in the past and allow them to go back to a truly nomadic life without boundaries?  People dying in Syria to get the right to write a blog like this, but the rest of the world decides this one isn't our issue - why is this different from Libya?  Blah blah blah you could go on all day.

Luckily today I don't have to worry about it.  I'm alright, my daughter is in Turkey having a great time, her room is being decorated by a crack team of decorators (Mrs F and Son-of-Furtheron), I have my own money in the bank so I don't owe anyone, anywhere a single penny at the moment - funny that was how my Dad brought me up - shame the politicians parents didn't instil the same discipline in them :-)  Tomorrow is Son-of-Furtheron's 21st birthday - 21!!! where have the years gone?  And we're off to London for a day out I believe.... Friday I go to see Iron Maiden with my son ... and life is bloody great really.  What is a few trillion dollars between friends after all?

1 comment:

  1. "What a utter mess" Is one way to describe it. Living here on the other side it is discouraging to say the least. The lot of us do not believe in funny money or that it amazing grows on trees. We it seems are no longer "We the people..." The US Government is out of control with its spending. No longer listen to the common Jo. Well enough of my rant. All the best.