I've been thinking a lot about the current economical crisis lately, not because it exists or how could it exist (I knew years ago we were going to be in debt, I'm good with numbers)...but moreso how throwing more money into already existing debt is going to fix the debt?

Too me, it sounds a lot like paying off a credit card with another credit card, the debt still exists but it is just in a different area. So I've been crunching the numbers to figure out how, if any, way we will spring our debt from the trillions it is in now to some sort of positive number...much less by throwing more money into the debt.

According to math if you throw money into a negative amount you still come out with a negative amount of money, and as a matter of fact the negative amount you come out with will most certainly be higher than the previous amount of money.

So I came up with a rough equation with roughly 13 trillion debt, now throwing in roughly 600 billion...and I come out with 13.6 Trillion in debt. I can't for the life of me see how this is going to turn out in any manner other than higher debt, perhaps someone can shed some light as to how this completly inane equation is supposed to help our withered economy.

O.K., I'll give it a try. I am reading you question, and it looks like you more fond of thinking, than of reading stories. I am also going to assume that your is not a rhetorical question.

Therefore, I am going to give you some pointers. They may change your understanding if our situation, if you use them as cliff notes to fill in-between.

What most perceive as money is no money at all, in the same way as a pocket with a hole is not a pocket anymore.

Money is against the law in United States. A simple attempt to use money, is a heavily taxable offence, and I am not talking about sales tax.

There is no shortage of what we call money, nor there is a shortage of money.

Anything is measured against more or less of the same. With this in mind, any lie, however big was it previously though to be, can be made quite small, simply by lying a lot more. Or any crime or a scam, these too, will obey this rule.

History has shown that countries that continue to spend more than they take in go bankrupt just like people. In recent years we have had to bail Brazil and Mexico out of jams. If the interest rate goes up, which it will eventually, the percentage of money paid by the US government for debt service will increase dramatically. The national budget will then consist of paying interest, mostly, instead of providing services. Some countries, particularly China, are now balking at continuing to buy US debt due to the drop in the value of the US dollar. However, they are afraid if the US economic system fails, the US debt that they now hold will become worth much less. A catch 22.

The problem is less about how much the US spends as it is about how much of the US currency and debt is sent overseas. If we send 750 billion a year overseas to pay for oil and 250 billion a year to China to buy everything we use on a daily basis, the resulting trillion dollar deficient has to be made up somewhere so it results in each dollar being worth less.

You are right, spending money to get out of debt is not the answer. However, if the US would build about 100 nuclear power plants NOW and invest in battery technology to make electric cars viable, you would see not only a dramatic drop in US dollars going overseas for oil, but also a rapid drop in oil prices due to lessened demand.

The single most important factor in making a country strong, self sufficiency, is the single most important factor hurting the US today.

watch this please for better understanding:

money as debt
http://video.google.com/videoplay?docid=-9050474362583451279

50 minutes of your life will make you understand many things that goes on.

You know what, Fear?

The Emperor was naked all along!


And it is a long slippery slope into a sad part of your country's history appearing... along with the countries that allowed their leaders to jump into bed with your former government...including mine.

It's time for the empire of greed to fall, and for the superlative expletives to be buried... no more superpowers...no more empirical greed...

It's going to hurt, a lot, but I work with optimism that a much healthier balanced structure will be created.

bottom line...we have a Tresurey Secretary who is a tax cheat,we were pretty much screwed from the begining of this Administration be seeing you

LOL And this one is a complete moron. I know that those like Bush gave the impression that we were all excessive and greedy, but it was a false impression. Where do you think all that they were being so greedy came from? There is a LARGE segment of the population that are strictly the work horses, we work, pay our taxes, and never get any breaks, only the deadbeats and freeloaders get the hand outs. I would imagine it is similar in most countries, just that the "front men" for ours seem to only represent the worst of our population.
I don't buy into the theory of "super powers". Everybody has the "ultimate weapons of mass destruction" by now. What are they gonna do, say "my button is bigger than your button"?

But sorry to say, as long as we have pres hussein in charge of things, I can only see things being worse for us, and any country that isn't predominantly black or muslim. So far, only pet projects he seems to be interested in are there, not even here at home on US soil. As an American, I suppose I should be apologizing for the pathetic imbeciles that voted for him, but that would kind of be like apologizing for the dog 2 blocks away dumping in your yard, you would know it wasn't my place. I never have, and can't see any reason why I ever would, approve of or support pres hussein. Lord help us ALL.

Alright, well, I don't care for a video...nor do I care what you personally think about money or whatever you may call it. What I do care about is how the hell throwing more money into a financial crisis is going to fix the financial crisis...

I'm not concerned with opinions here, or some outside third-party source of information. I want to know how the president is fixing debt by throwing money we don't have at it, that is all I want to know...nothing more, nothing less, no fine print.

Many say this very thing, and ask this very question.

However, because you don't care, you will not be able to understand why is he doing this. Why is he throwing money.

Sorry, there is no magic wand. You need to care for the subject, in order to comprehend it's workings, unless we're talking sex here.

It isn't. It is easier though then pushing accountability and responsibility. Besides, it gives the government another reason to raise taxes. They can never say no to that.

They're obviously using RUMPUS ROOM RITHMATIC!

spending money is what Democrats do. Its part of their inherent philosophy to inject money into the society to boost the economy

The EU is against it. They want more regulation. but most of the EU is so socialist that they are already spending too much money on their economies and can't increase spending the way the Americans want

The President of Brazil states that it is the American people's fault for living an extravagant lifestyle and funding it with borrowed money. A lot of non American people agree with that

Well obviously I do care...otherwise I wouldn't have bothered the time to type up the question, much less come back to the question. Simple enough it really doesn't work and you are therefore circling around the subject so that you don't put your own thought into it and rather listen to the next big news cast to air. Which is fine, if it works for you...I however would rather delve into the subject with my independent mind and figure out a solution.

Which, actually, there isn't one that I have found and you are yet to explain how this at all is going to work other then hightailing around the question at hand with useless metaphors and blind ramblings.

On a sidenote, thank you Quiet for the rough and I presume shorthand explanation.

I thought I was giving you a specific answer to your specific question. Throwing money at a problem of excessive debt which places you into deeper debt can only work if the money is targeted at what got you into trouble in the first place. The President is not doing that so, by definition, his plan will not work.

The US govt is now paying illegal aliens social security. Not only does that drain our resources, it encourages more illegal aliens to come. We therefore have higher unemployment, etc, etc, etc.

The US govt has numerous overseas "programs" to help various countries do various things but we don't have the money to do this.

The US govt has tariff programs which are biased against US interests which allow foreign countries to support their industry to the degree where their industry undercuts and eliminates our industry. For example we gave the technology to build F16 fighters to the Japanese who are now using the technology to develop their version of our aircraft industry. We can't even sell rice to the Japanese. How stupid is that? We have given the technology to build almost everything to China.

The way you spend money to "make" money is to invest in a product or technology that eventually produces more income than the investment. The above examples are what we are doing now which is exactly what we should not be doing. They produce nothing and damage much.

Forcing the US energy industry into a self sufficient role keeps all the income here at home which means it is spent here and continues to produce tax revenues here. Atomic power and electric cars.

Building a high speed rail system like Europe, China, and pretty much the civilized world has would, again, produce tax income over the long term, as well as increase the efficiency of transportation which benefits all US industry making it more competitive.

Spending money to fix a problem is possible. It does not appear to be possible with our current government.

I understand the basics of spending money to make money, it is investing in a future or so to speak...what I don't get is our country doesn't have the money, as I noted we are roughly 13 trillion dollars in debt. We don't have the luxory at this point in time to throw money into a pro-long investment idea.

FEAR!!! What'sup homie???

Hey, i asked the same question as you a while ago. Had to do a lot of reading to get tot he bottom of some of this.

I'm sure someone has answered your question already. I know Nogames has a firm grasp on economics and Atlantis pointed you toward a good vid... I haven't read through the posts yet, just your question.

Ok, in order to understand the economy you must first understand what is called fractional reserve banking. This is a concept where if a bank has $1,000 it can loan $10,000 without touching it. Then out of that $10,000 someone deposits they can loan $9,000 and out of $9,000 they can loan a little over $8,000 and so on.

Then you have to understand that tax money doesn't go directly to paying anything anymore. When a Federal reserve was invented the U.S. government has to borrow 100% (roughly) the money it uses for anything.

This makes no sense, as you cannot continue to pay loans with loans indefinitely. Every U.S. dollar thats printed represents debt.

Because of this the system is unstable as seen in this equation; Principal / (principal + interest).

This is where fractional reserve banking comes in. The government takes out a trillion dollar loan and puts it into circulation. Then, by using fractional reserve banking that trillion turns into 10 trillion dollars in circulation. This is where people buy houses, cars, pay college loans etc. Basically the wealthis artificial, AND temporary. It is temporary only because 100% of all our money going into circulation must be paid back with interest. Kinda silly huh? On the flip side ,in order to make these payments, we need to take out more loans which increases our debt...

Problem with all this is the system is only meant to be temporary. JFK actually tried to override this with executive order 11110 back in June 1963. Also kinda gets you thinking huh?

Our system of money is called Fiat currency. You can google that and perform your own research. Also google "fractional reserve banking".

It will explain all the retarded, nonsense policies that come to pass so easily.

Anyhoo... nice to see you back. A bit too tipsy to discribe things in great detain so i hope i didn't sound too retarded. Night bro...

So what you are really saying is you just realized how screwed we are.

Welcome to the club. Please note the govt will not admit the nature or the degree of the problem.

You are discussing two separate issues here. Throwing more money into the economy is to stave off a depression which will be the result of the recession without the cash flow.

Worrying about the debt right now is not really possible considering the recession we are in.

Yup

And you are right, they sure won't. Can you imagine tha panic and uprising it would cause though if they came through and admitted they'd been screwing us for almost 100 years?

Ahh, but the two are linked.

One influences the other in the long run.

Injecting money into an economy will help the recession for a year, maybe two, but in the long run you will be worse off. Look up inflation, and you will see why.

It will also explain the rising gas prices right now too. Unless the rest of the world suffers has much as we will, i expect to be paying $5 or more a gallon for gas and the price of food to nearly double as well... Either way we will see.