The Chains of Debt and the Biggest Debt Bubble in History
"A man in debt is a man in chains." James Lendall Basford said this in 1882, and things haven't changed much. When you're in debt, you're in chains, either as an individual, or as a nation where you're taxed to pay for debts others make on your behalf.
Chris Potter, flickr
The U.S. national debt is officially at over 21 trillion. You can see it continue to climb, along with all the related metrics, at USDebtClock.org. One interesting measure is how much that means for each U.S. citizen. Divided amongst everyone in the nation, each has a debt of $64,555. That's pretty insane. Did you sign on for that debt? Why should you have to pay that insane figure?
usdebtclock.org
And this debt doesn't even include all forms of American debt, only the national debt. When factoring in all debt, it's at 70 trillion. Spending is out of control. People spend today with money they don't have, living beyond their means.
A lot of people think the 2008 financial crisis is gone, all is well, and things are just fine with America at least on nit's way to "greatness" once more. No wonder it's called an "American Dream", people are asleep and dreaming.
The economic practices of the U.S. and much of the world is not sustainable. Debt continues to grow at a rate that exceeds the gross domestic production (GDP). CNBC has reported that consumer debt is projected to hit $4 billion by the end of ht eyear:
Americans are in a borrowing mood, and their total tab for consumer debt could reach a record $4 trillion by the end of 2018.
That’s according to LendingTree, a loan comparison website, which analyzed data from the Federal Reserve on nonmortgage debts including credit cards, and auto, personal and student loans.
Americans owe more than 26 percent of their annual income to this debt. That’s up from 22 percent in 2010. It’s also higher than debt levels during the mid-2000s when credit availability soared.
Americans are living on the edge, the edge of financial responsibility that is. More than a trillion is owed for auto loans, the greatest auto loan debt bubble ever. Another trillion is owed on credit cards, with credit card delinquency rising higher than the previous financial crisis:
In the first quarter, the delinquency rate on credit-card loan balances at commercial banks other than the largest 100 – so at the 4,788 smaller banks in the US – spiked in to 5.9%. This exceeds the peak during the Financial Crisis. The credit-card charge-off rate at these banks spiked to 8%. This is approaching the peak during the Financial Crisis.
We're in the largest debt bubble in history, and are on the cusp of the greatest financial crisis in history. Bubbles keep growing. There was never a real popping of the bubble post-2008. The bubble only deflated a bit but was quickly blown up again, making the problem worse. The economy is now "ten times worse" than it was 10 years ago in 2008.
Corporate debt has also double since the 2008 financial crisis. This is probably due to the Fed's laughable attempts to "grow" the economy by lowering the interest rate to zero for years, printing more money into existence which just made inflation worse. If the economy takes an even greater turn for the worse, the whole joke could collapse and plummet the U.S. and other nations into what would resemble third-world countries.
The U.S. national deficit is expected to double to one trillion per year by 2021, and two trillion per year by 2028. The chains of debt are chaining people to a future they don't want. We're all enslaved, even if we don't have personal debt from credit cards or loans or are spending beyond our means. Governments are exceeding their financial reach. If When the U.S. economy fails, it will send a ripple effect across the globe and send the whole world into the greatest financial crisis ever seen.
If nations don't break free from this wild spending, everyone is going to pay the price. We're in a race against an inevitable collapse. But most people aren't aware of the money magic manipulation game or how they are being enslaved.
Thank you for your time and attention. Peace.
References:
- We are living in the terminal phase of the greatest debt bubble in history and our debt just keeps getting bigger
- Why America Is Heading Straight Toward The Worst Debt Crisis In History
- Consumer debt is set to reach $4 trillion by the end of 2018
- Investment expert warns the economy is 'ten times worse' than in 2008 and will inevitably implode
- Goldman Sachs: The fiscal outlook for the US 'is not good'
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Debt puts us into slavery. Almost every country in the world is under a tremendous burden of debt. Every citizen of these countries is a debtor. Even an unburned child has a loan amount against its name.
As you mentioned every US citizen owes $64,555. From where did he/she get that loan? Has one applied for loan or borrowed money for ones country? From where and for whom this burden of national debt comes? It is clear that government does nothing for a section of citizens. It fails to provide them security, justice, opportunities to earn money and enjoying rights which nature has bestowed us. Most of the people are not better than slaves for governments. So, why every citizens should be included for the purpose of calculating national debt?
As citizens never apply for loans and they also pay taxes then where does this loan amount go? Who reaps the fruit of this so called national debt? Only politicians, corporate and government officials get benefitted from the national debt. During recession corporate received bailout packages which was used to pay bonus, perks etc to the top management and directors of companies while other employees were being fired in the name of economical measures. This national debt goes in the pockets of those people who run the system. In India rich people received loans from banks in the name of their companies. They never repaid the loan EMIs and when companies were declared bankrupt, chances of recovery of loaning amount also faded. The government gave bailout packages to the banks which also cut the amount of social welfare. Banks also raised interest rates for the common people to recover the bad loan. That ultimately made the life of common citizens pitiable. But the rich businessmen had no effect on their pocket.
Nationalism is a hollow word which is just a tool to exploit common people. Banking system is a tool to make rich richer while looting common people. Some experts (economists) say that the world has so much debt or they put forward figures stating that every citizens of this world has so much debt on his/her head. From where does this world debt come? Has aliens given us this loan? Who owes this debt and who provides this debt? Isn’t this a lie which is being served to us to protect the interests of the rich?
Yup, rich corps get free loans in many cases, no need to pay back in the end, and they get bailed out for being fiscally unstable. Meanwhile the rest of us don't matter as much :/
This is the real face of our so called modern democracy. In fact democracy is being changed into demoncracy.
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I've become much more optimistic of the impending economic collapse. I think in the long run it will be good for everyone and it will allow crypto to thrive.
A total catastrophic collapse of the debt-based economy will open the door for a superior system to take it's place. Crypto is showing us that communities can take control of their own currency and create a system that doesn't revolve around usurious debt.
I agree with what you say here, however, the bubble bursting will have a negative(in some cases fatal) impact on a lot of people, worldwide. That's the only reason I don't clamor for the cleansing fire of change.
Lucky for us, our feelings on the matter are irrelevant. We don't have to carry the burden of such a serious responsibility. Whatever happens happens and we have very little say in the grand scheme of things.
Aint't that the truth!
The collapse is required. We're in a fantasy. But it's not good to experience. There will be suffering. But the suffering of reality is favorable to the comfort of an illusion. When the old collapses, it can allow for something better to come in, but it can also allow something worse as well.
Well written and succinct article. It really baffles me that folks continue to spend and live beyond their means. I expect that from capatalistic nation states though...
The entire paradigm is complete insanity and I like that you made the parallel of ""American Dream", people are asleep and dreaming." Couldn't be more true! We sign death pledges (mortgages) to "own" houses on stolen land. Furthermore so many work jobs they hate just to pay the interest on the loans or mortgages for things we don't need!!!
Thanks for getting me all fired up tonight over this. I made a very clear choice to never go into debt unless absolutely necessary. Live smaller and debt isn't even remotely intriguing.
Yes, live small, be debt free, and work for what you need to get, don't borrow ahead of time. The houses aren't owned until the debt is paid, because you could have paid 90% of it and then if you have trouble, they just take your house because the bank owns it really.
"Our" governments overspends and sells the country into the hands of private investors that get repaid by the work of our children. By debt the plan is to enslave people that are not even born yet and have nothing to do with the current situation.
The good news is that it wont work. In the next big crisis the debt will become worthless and fiat with it. What will be left is generation long miss-investment into unneeded and expensive government projects.
Yes, ownership of the world id dominated, no one can own anything really, everyone is a slave to the masters, not owning and owing... we're owned... :/ The crisis will bring suffering, potentially to something better in the end, but potentially can be bringing a worst world as ppl will flock to governments to save them, begging for help.
Indeed it is a mess and will be multiple times worse than 2008. They may use this as a bail in rather than a bail out. Personal IRAs may be tapped into for the good of the nation supposedly. They may even bring in a new currency (Remember the 1988 cover of the Economist magazine where a phoenix was rising from ashes of burning paper fiat money with a gold piece saying 2018). However it is interesting that Donald Trump who has managed 4 bankruptcies is our president. coincidence? Perhaps not. It may have been planned. For this I would rather have him than anyone else at this time in American history. I truly appreciate the article @krnel.
Yeah, the next one will have bail ins, where shit loads of ppl will lose their money, not taxes in a babil out to pay for it. It's theft of a higher magnitude.
In my opinion people don't want to over spend, actually they are manipulated through lot of advertisements and people are influenced by the brands and brand advertisement means, for example, if today one individual purchase an iPhone then tomorrow the magic of advertisement switched on and that individual attracts towards the new model of IPhone and this chain always continues.
We are not taking what we need, and we are taking what they show which is not the requirement for us. And everyone should understand the situation because most of us are influenced by the false news, advertisements and false politics.
And most of the countries are living in debt and people of those countries should understand that if debt will increase then they will controlled more and possibly they will be enslaved and we have to avoid these situations collectively.
The most common issue which we are facing is, lack of knowledge and observation, we know all the terms of economy but we are not taking an economy seriously, and we have to showcase seriousness towards it.
Thanks for sharing this post with us and wishing you an great day. Stay blessed. 🙂
Yes, we are ruled by unconscious desires that are inculcated into us :/
True.
Haha Tell me about it. I got suckered into some student loans when I was 21 and have been "chained" to those ever since.
One can make a pretty strong effort to not live beyond his or her means but I don't know how to address the problem on a national level. Both parties throw money at all sorts of nonsense in the U.S. despeite what they claim. Look at defense spending and what that money is spent on. A few years ago the Army said it had enough M1 tanks and, shortly after, congress voted to pay to build more M1 tanks for an army that didn't want them.
Government is really really really efficient :/
I don't quite remember the book, but a few months ago, I read something where the author said:
"We are addicted to making debts."
That line was quite....unsettling.
Yup, people just want things, and get into debt... we're ruled by money credit and debt, unable to get loans to help us do things without being extorted into interest payments...
It's true...and there isn't any sign for betterment on the horizon.
the ability live within our means is over. this is because we are no longer connected to our environment. i know philosophy is a poor pill for a debt ridden person to swallow, but you cannot change the nature of things.
our own desires don't exist. we are fueled by other people's wants and needs. our thought process has been subjugated and instead we aspire for pinnacles that we have never seen before in life.
perhaps we have lost contentment. the kind that comes with realizing our place in the world
Being content with having less is hard for many to grasp :/