There will be no "cuts!"......

A slowing in the borrowing starting some years in the future is all. Watch the moaning and hair pulling as the frauds in office fuck us over. No politician can afford to take one dime a way from anyone and stay in office.

So we kick the can down the road. prepare yourself for the next bust. 5 years, or a couple more, then bam!!!

By the way, how's the recovery working for you? Are you better off now than 4 years ago? And which politician will make it all better? Think Oba mama can be beat by the flyweights in the Republican party?

Yea, right! They need a miracle because this guy can spend damn near a billion to get his gang re-elected.

 And it's all a matter of money now days!

oftwominds: Our Peculiar State of Suspended Animation

The U.S. is in a peculiar state of suspended animation: nothing is actually moving, we're all frozen in an extended moment of disbelief, denial and crisis, waiting for something to finally break loose.


We know the present isn't sustainable, but we go through the motions of phony "reforms" and "trimming the deficit" as if another 1,000 pages of "reforms" will fix what's broken in the economy or that trimming $50 billion from $1.7 trillion annual deficits will actually matter.


The wheels visibly fell off the bubble-debt-fraud economy four years ago in mid-2007. It's worth recalling that the U.S. won a global war (World War II) in less than four years, yet now we are pleased to borrow and and squander an extra $1 trillion a year just to keep our fragile state of suspended animation from being disrupted by unpleaseant reality.


In a nutshell, here's the reality: the entire "prosperity" of the past decade was a false prosperity, constructed entirely of money borrowed by the private sector based on the rising value of McMansions and strip-malls that made no sense except as speculations based on the Federal Reserve's credit-bubble policies and Wall Street's systemic financialization of that debt based on fraud and misrepresentation of risk.


The private sector borrowed and spent an extra $1 trillion a year in the "boom years" of the bubble decade. This debt-based stimulus vanished with the implosion of Wall Street's fraud machine (CDOs, mortgage-backed securities, etc.) and the collapse of bubble-era housing valuations.


As overleveraged households and businesses found they could no longer borrow $1 trillion extra a year to spend, then the Federal government stepped in and borrowed and spent $1 trillion a year to replace the private borrowing which had dried up.


This $1 trillion is incredibly obvious. Federal spending rose by exactly $1 trillion from 2007 to 2010, while revenues fell by $400 billion:


Spending:
2007 $2.72 trillion
2010 $3.72 trillion