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Total Debt Growth vs. GDP GrowthAnyone that thinks that the U.S. economy can keep going along like this is absolutely crazy.  We are in the terminal phase of an unprecedented debt spiral which has allowed us to live far, far beyond our means for the last several decades.  Unfortunately, all debt spirals eventually end, and they usually do so in a very disorderly manner.  The chart that you are about to see is one of my favorite economic charts.  It compares the growth of U.S. GDP to the growth of total debt in the United States.  Yes, U.S. GDP has certainly grown at a decent pace over the years, but our total debt has absolutely exploded.  40 years ago, the total amount of debt in our system (government debt + corporate debt + consumer debt, etc.) was about 2 trillion dollars.  Today it has grown to more than 56 trillion dollars.  Our debt has grown at a much, much faster rate than our economy has, and there is no way in the world that we will be able to continue to do that for long.

Posted below is the chart that I was talking about.  The blue line is our total debt, and the red line is our GDP.  As you can see, this chart kind of speaks for itself…

Total Debt Growth vs. GDP Growth

So how did we get here?

Well, of course the federal government has been the biggest offender.  It would be a tremendous understatement to say that the politicians in Washington D.C. have been reckless.  Since the year 2000, the size of the U.S. national debt has grown by more than 11 trillion dollars.

Posted below is a chart that demonstrates the dramatic growth of the national debt as a percentage of GDP.  In particular, our debt has absolutely exploded as a percentage of GDP since the financial crisis of 2008…

National Debt As A Percentage Of GDP

Does that look sustainable to you?

Of course it isn’t.

Right now, the mainstream media is very excited that the federal budget deficit for this year might be less than a trillion dollars, but they are really missing the point.  The debt of the U.S. government is still growing much, much faster than the economy is, and the United States already has more government debt per capita than Greece, Portugal, Italy, Ireland or Spain.

What we are doing to future generations is absolutely criminal.  We are piling up mountains of debt that will haunt them for the rest of their lives just so that we can make the present a little bit more pleasant for ourselves.

As I noted in another article, during Obama’s first term the federal government accumulated more debt than it did under the first 42 U.S presidents combined.  And now we are entering a time period when demographic forces are going to put a tremendous amount of pressure on the finances of the federal government.

The Baby Boomers have started to retire, and they are going to want to start collecting on all of the financial promises that we have made to them.

As I have written about previously, the number of Americans on Medicare is projected to grow from a little bit more than 50 million today to 73.2 million in 2025.

The number of Americans collecting Social Security benefits is projected to grow from about 56 million today to 91 million in 2035.

Where are we going to get the money to pay for all of that?

Boston University economist Laurence Kotlikoff has calculated that the U.S. government is facing unfunded liabilities of 222 trillion dollars in the years ahead.

There is no simply no way that the U.S. government is going to be able to meet those obligations without wildly printing up money.

And of course the federal government is not the only one with massive debt problems.  We just saw the city of Detroit go bankrupt, and there are lots of other communities all over the nation that could soon follow.

Posted below is a chart that shows the growth of state and local government debt over the years.  In particular, please take note that the total amount of state and local government debt has grown from about 1.2 trillion dollars in the year 2000 to about 3 trillion dollars today…

State And Local Government Debt

But the chart posted above does not even take into account the massive unfunded pension obligations that state and local governments are facing.  According to the Detroit Free Press, state governments are facing unfunded pension obligations of nearly a trillion and a half dollars…

From Baltimore to Los Angeles, and many points in between, municipalities are increasingly confronted with how to pay for these massive promises. The Pew Center for the States, in Washington, estimated states’ public pension plans across the U.S. were underfunded by a whopping $1.4 trillion in 2010.

And many large cities are dealing with similar situations.  Detroit was the first to go down, but could Chicago or Los Angeles eventually be forced to declare bankruptcy too?…

Chicago recently saw its credit rating downgraded because of a $19-billion unfunded pension liability that the ratings service Moody’s puts closer to $36 billion. And Los Angeles could be facing a liability of more than $30 billion, by some estimates.

According to a report that was released earlier this year, the largest U.S. cities are facing hundreds of billions of dollars in unfunded pension liabilities at this point…

Early this year, the Pew Center released a survey showing that 61 of the nation’s largest cities — limiting the survey to the largest city in each state and all other cities with more than 500,000 people — had a gap of more than $217 billion in unfunded pension and health care liabilities. While cities had long promised health care, life insurance and other benefits to retirees, “few … started saving to cover the long-term costs,” the report said.

So where will all of that money come from?

That is a good question, and nobody has an easy answer at this point.

Meanwhile, U.S. consumers have been racking up staggering amounts of debt over the past several decades.  Just consider the following numbers…

-Total home mortgage debt in the United States is now about 5 times larger than it was just 20 years ago.

-Car loans just keep getting longer and longer, and approximately 70 percent of all car purchases in the United States now involve an auto loan.

-The total amount of student loan debt in America recently surpassed the one trillion dollar mark.

-One study discovered that approximately 41 percent of all working age Americans either have medical bill problems or are currently paying off medical debt, and according to a report published in The American Journal of Medicine medical bills are a major factor in more than 60 percent of the personal bankruptcies in the United States.

-Consumer debt in the United States has risen by a whopping 1700% since 1971, and 46% of all Americans carry a credit card balance from month to month.

Sadly, most people don’t realize how damaging credit card debt can be.  If you just carry an “average balance” on your credit cards each month, and those credit cards have just an “average” interest rate, you could end up paying millions of dollars to the credit card companies by the end of your life…

Let’s say you are an average American household, and you carry an average balance of $15,956 in credit card debt.

Also, as an average American household, let’s assume you pay an average current rate of 12.83%.

Finally, let’s assume you carry this average balance for 40 years, between ages 25 and 65.  How much did your credit card company make off of you and your extreme averageness?

Answer: $2,629,618.64

Incredibly, a large percentage of the population does not seem to understand these things.  An astounding 43 percent of all American families spend more than they earn each year.

Are you starting to understand why approximately half of all Americans die broke?

We are a nation that is completely and addicted to debt.

If you do not believe that it will ever catch up with us you are being delusional.

We have piled up the biggest mountain of debt in the history of the planet, and a day of reckoning is fast approaching.

  • MichaelfromTheEconomicCollapse

    Here is another article by me that you guys might want to check out…

    16 Conspiracy Theories That Turned Out To Be True


  • markthetruth

    Yea ! There life on Mars .

    the end…

    • Mondobeyondo

      I know! Ran into a little green man the other day,If you ask me, it was more jealousy and envy than anything else.

  • K

    Not to worry about the pensions. Detroit already showed the solution, cut them by 90%. Who cares if Grandma starves? And while you are at it, let us keep fanning the flames of hate in this Country. After all everything is solved once you kill off, fill in the blank, with the group you hate. This seems to be the answer for way too many people. Not my answer by any means. You can almost feel the evil growing stronger every day.

    • Syrin

      What is Detroit supposed to do about pensions? How about any US city? It’s the single biggest budget item, and they’ve cut teachers, cut police, cut fire fighters. None of it even comes close to what they owe in pensions. They have no options. The third rail never got touched even though we all saw this as an enormous time bomb, and now it’s finally exploding.

      I’m not sure why liberals think it’s better to pay people not to work rather than pay those who are working, but that’s what’s happened. (Actually, I do know, it’s to buy their votes). The laws of economics could not be altered based on hopium and promises. The money for those pensions is not there. People are taking more out in pensions than they contributed, and taking benefits much longer than expected as life expectancy increased. Fewer people are working than any point in US history, so the money to fund those pensions doesn’t exist. Granny should not have relied on a gov’t pension. That’s a modern day liberal contrivance that did not exist for millenia of human existence. It still does not exist for the majority of humans living today. The stark reality is people will actually have to SAVE for their OWN retirement, and work longer rather than spend it all now, retire at 65 and live off their fruit of their children’s labor for another 10-15 years. Again, economic reality. Yeah it sucks for those caught in the blast, but this is what THEY VOTED FOR !! Hard to feel sorry for those who think the solution is to live off the fruit of other’s labor.

      • K

        Granny should not have relied on a Gov. pension? She was not given a choice, they took the money from her. So retirement is just a liberal experiment? So all of us who were forced to pay into these plans are just lab rats to you? Folks at the end of a failed experiment, they usually put down the infected lab rats. Guess some people want to get rid of an even bigger group than I thought.

        • Mr. Ditba

          There is always a choice. Granny was given the choice of whether she wanted to save for her own retirement or trust the government with the money they were stealing from her. she also had the choice of working for the government. This is nothing new. People have been saying that this was coming for decades. Some made the choice to listen and prepare. Some chose to ignore the information. There was always a choice.

          • Jack Frost

            Just what line of work do you think Granny engaged in that she could fully fund multiple retirements. Plus the money forcibly extracted from her check was not saved for her, it went to pay for those who retired before her so they could afford to live. Now her turn has arrived an Ponzi has again been proven a schemer. Maybe a specialist physician could fund multiple retirement accounts, or she could have foregone children or eating multiple meals each day, or simply lived outdoors year round.

          • elHombre

            “Granny was given the choice of whether she wanted to save for her own retirement or trust the government with the money they were stealing from her.”

            Participation in pension plans was always mandatory for gov’t employees. The choice was to give up the job. Back then, it was considered honorable to work in public service. And there weren’t too many folks around whining because we earned 70% of what they made in the private sector.

          • Bradford

            Mr Ditba. You are an idiot sir. NO offense. You just drink the kool-aide Fox News spews out every nite and think you are educated. Most people didn’t have enough true information to make a choice!

        • Gay Veteran

          Reagan raised Social Security taxes and promptly spent the money, as has all presidents.

          • GSOB

            ‘We had gay burglars the other night. They broke in and rearranged the furniture.’

            Robin Williams

      • elHombre

        Another intellectual gem from the king of hindsight who saw government pensions as “an enormous time bomb.” Sure he did.

        Funny, when I retired, my pension was funded at 126%. Those were the days when they told us: “We won’t pay what you’d make in the private sector, but you’ll have a nice pension.”

      • Reynaldo Neggle

        Where in the rules of being a human being does it say that your job is supposed to give you a pension? Anyone with half a brain knows that pensions are a ponzi scheme anyway and are not sustainable over the long term. Most Americans retire without a pension anyway, so it’s hard to have sympathy for anyone that thinks he’s supposed retire with a big pension built upon MY tax dollars. What gives these people the right to think that I’m supposed to fund their retirement? I’m saving up for my own not waiting for my neighbors to give me a free ride.

        • TooLittleTooLate

          Yup, I agree. Funny thing is that I work for a very large telephone company. I have a penson… I don’t work for a union…. I also have a 401k…. My company is a union company but, I don’t work for a union. I’m management… or considered management. I don’t manage people but, I am a high tech guy that writes programs in the “cloud” enviornment. LOL I don’t know if my “pension” will ever be in tact when I need it but, at least is isn’t public sector and, 10yrs ago when I joined the company, 9yrs ago they stopped offering pensions to new employees…. Wish I could take the money they’ve contributed and buy metal with it.

      • Gay Veteran

        “…I’m not sure why liberals think it’s better to pay people not to work rather than pay those who are working, but that’s what’s happened. (Actually, I do know, it’s to buy their votes)….”
        BOTH parties support this? Why? To keep the peace so the top 0.1% can continue looting this country, while the middle class tax donkeys pay the bills.
        And the problem is not Social Security. The problem is the monopolistic medical industry. Our medical bills would be over 50% less if we enforeced the monopoly laws against the sickcare industry.

        • Ayn Rand

          Hey, if people stopped supporting the sickcare industry and went into homeopathic and natural remedies, the entire health problem would be solved. I think people should stop with the “Liberal” and “Conservative” name calling because there really isn’t a difference anymore. They are both statist.

        • TooLittleTooLate

          I think the largest problem is that nobody is paying the bill anymore. The system has truly gone off the rails and those in office are only dealing with THIS election cycle…. which is always the case, right??? It doesn’t matter to them if everything falls apart as long as it isn’t on their watch…. truly sickening. Apparently morals and values be damned…. bunch of corrupt self serving low life POS politicians in charge.

    • Wolfgang Riggins

      The people of Detroit Deserve what they get and the people of the US will also get what they deserve. City workers have stripped the tax base. THERE IS NO MORE MONEY and frankly (sitting here in NJ) I don’t want to pay for a bailout. Any union is free to negotiate, but Detroit is why government workers shouldn’t be allowed to unionize. They THINK they can just endlessly extort more money from the tax payer without consequence.

      • TK

        It don’t get no plainer than that WolfGang. The US will get what they deserve. There is no more money

        • ZipR22

          A Complete Crash or not, this economy is not in good shape

          Check: Dailyjobcuts com

    • TooLittleTooLate

      Interesting, isn’t it?

      There’s no way public sector unions should be legal. You have the politicians and the unions striking a deal from the same side of the table… the only ones on the other side of the table are the taxpayers that get to fund this nonsense… and apparently, there isn’t enough money.

      When the money runs out and things get tough, people get mean. We haven’t seen anything yet, I’m afraid….

      There will be a reset…. it’s simple 3rd grade math… it can’t be denied.

      Not sure when it will happen though… Don’t underestimate the FED and corrupt politicians to drag this thing out for a long time.

    • TooLittleTooLate

      The other thing I’d say is that you’re right, K…. Our first post racial president is fanning hate…. our own Eric Holder lets the black panthers go while going after George Zimmerman…. That trial was not racial until Holder came along and made it so.

      I hate to say it but, we deserve what we get. IF this is who we put into office… if this is the corruption we allow to go on…. we basically elected a mob boss… then elected him again.

      Lobbiests and special interests run this country…. I don’t even know why we bother voting anymore.

      Both democrat and republicans want to fly drones over your house… both want more and more authority over you…. are they different really? I’d say that they’re only slightly different but, both parties are an enemy of freedom.

      • K

        There are some third party candidates, worth giving a chance. Also if enough of us voted third party, and the numbers did not add up. Then at least we would know the elections are as rigged, as everything else.

        • TooLittleTooLate

          Yeah, there are a few of them. I’m happy Texas elected Cruze… He’s a good guy that represents me. Trouble is that he is one of the only ones there that are honest brokers, in my humble opinion. We could talk about congressional districts and gerrymandering and term limits and all the other corrupt crap that has destroyed our once great nation.

    • Mudpie

      The evil IS growing every day. Many of us feel it.

  • Mondobeyondo

    We are in deep, deep trouble as a nation. We will not survive, without some big time, major league help (and some divine intervention). Detroit is just the beginning. People don’t seem to be too concerned. Just wait when Canton, Ohio and Birmingham, Alabama go belly up. (Birmingham’s well on the way. That city is broke too.) People may start to pay attention then. By then, of course, it will be too late.

    • Syrin

      Chicago is broke, New York is broke, the entire STATE of California is broke. This is just the first domino. As I have stated ad nauseum, the laws of economics will eventually take hold, and they are starting to do so.

      • Pauly

        How could NYC be broke, they rake in about a $100,000 per min. in bridge tolls, subway and bus fares alone?

    • markohio

      I agree Mondo. Here in NE OH you can also throw in Cleveland and Akron. The have nots per se outnumber the haves.

    • Hellfire1968

      Add Baltimore into the mix too. Ghetto people are moving out into the county leaving vacant/abandoned houses all over the city like a cancer (City will start to lose money just like Detroit) – I left Baltimore because they kept raising the property tax. Anyone with a house is getting nailed with taxes.

    • Gene Baugh BBA

      Detroit is not the first victim just the new name at the top of the list of biggest municipal bankruptcies. Stockton was the last city to hold the title I think.

  • Mondobeyondo

    Aren’t we the richest nation on earth? Then why are so many of our citizens broke, struggling and suffering? It’s confusing. You’d think we’re living in Cambodia or something.

    We are a better nation than this. We are an ongoing experiment – people from different ethnic, social and economic backgrounds, living in the same country. That’s unique.There is no caste system here. Problems are inevitable, and it’s by no means perfect, not at all. But for the most part, it’s worked rather well. The U.S. is not Sweden or Japan or Saudi Arabia, where everyone looks the same and shares the same beliefs for the most part – and even then, the people don’t always get along!! We are diverse – Anglo, African American, Hispanic, Jewish, Arab,, Hindu, Wiccan, and those Martian refugees from that crash in Roswell.

    This country has been successful because it gives you the hope of an opportunity. You are not destined to a lifetime being a ballerina or some other career you hate.

    This country has been incredibly blessed. You want fruit and veggies? California’s got ya covered. Wheat? Ask a Kansas farmer We are the world’s breadbasket. You want pizza, and can’t afford to fly to Rome? Head to New York City. This was the America… I used… to know.

    What went wrong? To sum it up in three words: Greed, greed, greed.


      With so many different kind of people here it makes it easier to pick you out of a line up.

    • Tom_F

      @Mondobeyondo, great post (especially conclusion) and may I add…what do you mean “we”, white man? “We” are no longer a nation. We are 47%, and 53%. And of those 53%, we are 43% and 10%. We are ones who 1) go to school, get a job, respect the law and others; and 2) those who don’t. We are govt workers, and private sector workers. Republicans and Democrats. Against gay marriage and don’t care about gay marriage. Against abortion, and don’t care about abortion. Against 2nd Amendment, and for 2nd Amendment. Sympathetic to criminals, and sympathetic to victims. Etc.
      To add to the answer you give for “what went wrong?”, I think we elected a ruling class that “gave away tomorrow” for a few more votes today.

    • Jack Frost

      Don’t forget to throw in the race hucksters who foment dissent and demand reparations in entitlements from others based on century old transgressions. You have been adjudged guilty and racist by your skint tone, so shut up and keep forking it over.

    • Reynaldo Neggle

      We’re not the richest nation and we never were. We just piled up monuments of debt building our monuments of luxury to make it look like we were styl’in fo sho. And it helps to have a military big enough to ransack the rest of the world for their riches. “USA! USA! USA!”

    • naro

      Its the white men who built this nation, and the world economy for that matter. When they become a marginal minority the entire system will collapse. You think that blacks and Latinos can build anything of substance? Latinos are hard workers, but not creative. Blacks just tear everything down. Good luck America.

      • joemiller33

        Black people are savages..go back to Africa please…

  • Rufus T Firefly

    I feel sorry for all those Chinese and Japanese who hold so much of America’s debt. You guys ain’t going to collect it anymore than America got to collect its World War I debt from our noble European allies

    • 007

      China has quit buying and hasn’t bought any more u.s. debt for the last year. The FED is the only one buying now. So what is the real likelihood Bernanke starts “tapering” his purchases, about 0%.

      Unless he intentionally intends to collapse the economy. Some people think that is his game.

      • Syrin

        Didn’t you see? The Chair Satan is looking to leave his position.

        • Reynaldo Neggle

          Yep. Greenspan left and then BOOM! Bernanke’s doing the same thing. Look to right after he departs for our economic world to implode in on itself.

        • Gene Baugh BBA

          I don’t think the fed will change it’s policy.

      • jakartaman

        A very quick way to drastically reduce debt is de-value the US dollar
        That’s the game folks. You could wake up tomorrow with 50% less $$

      • Gene Baugh BBA

        His game is to plug the hole being caused by the contraction in private debt. The Australians gave the money to households instead. I have heard that is working better than giving it to the banks here is.

    • Syrin

      Here’s the thing. SOMEONE sabotaged the price of gold a few months ago, and CHina has been buying gold by the metric ton at firesale prices knowing they were holding junk in the form of US bonds. They have bought massive numbers of MAJOR US businesses and millions if not billions of acres of US farm land and retail acreage. They know what’s coming and have been preparing. Japan is screwed beyond recovery.

      • Pencrna

        Hi….my colleague has a friend on Wall Street. In April the US saw its largest ever private gold purchases. The SEC went to the heads of major brokerage houses and begged?, ordered?, threatened? Them to encourage fund managers to dump paper gold assets to drive the price and the demand down. The fear was that if folks called in their ‘baskets’ of physical, there would be a run on the market for fear of lack of physical metal. Hope this helps.

  • stagflation nation

    unfortunately trillion plus annual deficits is yesterdays news. 3-4 even 5 trillion annual deficits will become the norm going forward.more u borrow the more u need to borrow

  • ian

    yawn……then next year it might crash…..then the next year…..then the next year………oh wait…….maybe the next year……….or next year……ad infinitum………..blah.

  • Ralfine

    The question isn’t whether the economy is going to crash but how to make money off those who believe everything will go on like before and how to make money off those who believe it will crash.

  • Syrin

    For the last 4 years, the outcome has never been in doubt, at least for those with any ability to reason (that excludes you Gary). The only issue has been, and still remains, when?

    • Gene Baugh BBA

      The last depression was described as “a giant boulder slowly rolling over us.”

  • Ralfine

    Just watching RT. Title: Third World America
    America ranks 50 for longevity and 49 for infant mortality out of 200.
    Strong belief in U.S. it is still the greatest place on earth

    • El Pollo de Oro

      Ralfine: Male life expectancy in McDowell County, West Virginia is 64. In Bolivia (one of the poorest countries in Latin America), it’s 65. Men in Bolivia are living slightly longer than men in McDowell County. You’ve often heard me rant and rave about how The Banana Republic of America is now a Third World country and how we’re ending up with the dramatic inequality of Latin America or the Caribbean. But in parts of West Virginia, men are dying a bit younger than the average Bolivian male.

      • Ralfine

        Just see it positively:
        People dying before 65 won’t need pension.
        And for the others you increase pension age to 70.

        Pension problem solved.

        • El Pollo de Oro

          Ralfine: Very true. When I see all these morbidly obese people in my neighborhood, I think to myself, “Many of these people won’t need IRAs, pensions or social security because they won’t live long enough.”

  • Bruce

    Michael, I am going to ask you the hardest question you’ve ever been asked. WHEN? I agree with the majority of what you write. I am aware of most of the statistics and the facts and figures. But, when will the straw that broke the camels back be placed upon his girth? What is your educated, informed opinion? Secondly what do you think will be the true catalyst for the collapse? Bruce

    • Ralfine

      Is it really that important, WHEN it will happen?

      How would it influence your life, your decisions, if you’d know you can continue as before for three days more or less?

    • Ralfine

      What facts and figures are you looking at?

      What about that TB outbreak in South Carolina?
      The fungus outbreak?
      Monsanto pesticides in humans?

      How will diseases plus

      gun deaths plus

      veteran suicides plus

      teen bullying plus

      infrastructure crumble plus

      gas prices plus

      sleepless doctors plus

      malnutrition plus

      food stamps plus

      food stamp approved food plus

      draught plus

      food prices plus

      benefit cap plus

      fuel costs plus



      fuel America’s Greatness?

    • CRAT

      Bruce-I have also asked that question. In reality, the collapse is happening now. There may be a major “black swan” event, or it could be a grinding, slow collapse that takes many years. Karl Denninger and others theorize a major downturn within 2 years, others believe by year’s end.

  • MeMadMax

    It’s not even “real” gdp. Alot of it is just service market crap. Where the guy at mcdonald’s buys a latte at starbucks then the guy at starbucks buys a double cheese at mcdonalds, creating “gdp”… Gone are the days we BUILT things like highrise buildings, planes, cars, etc etc…

    • Reynaldo Neggle

      The real war that’s going on is between individualism and collectivism. All cities are collectivist in nature. They do not produce anything that is real, and everything they consume, water, food, power, etc. all comes from the outside. It’s all just paper-pushing and the exchanging of crap. That’s why the collectivists needs the govt to take care of them, they’re a complete drain on society.

  • Naples Florida

    Mark this and put it on your refrigerator: America will borrow money in your name till it collapses from debt. This government borrows over 4 Billion everyday because it can’t pay its bills. It is fiscally and morally irresponsible. When does16 Trillion in debt get paid off? In 16 Trillion years?

    The news media should ask Obama everyday:When are we getting manufacturing jobs back and when will we stop borrowing billions everyday.

    I remember an America where most had manufacturing jobs. Manufacturing jobs made the middle class. Now everyone goes to college and most having nothing to show for it, and they are not middle class. Walk around Walmart and take a good look at America. It’s Third World already.

    • TK

      You ain’t kidding Naples. 3rd world, here we are

    • Reynaldo Neggle

      The top 0.1% are strip-mining our economy and our futures of every last piece of silver left in the cabinet drawer. When they’re done they’ll get on their private jets and fly to their lavish villas outside the country, leaving us to fight over whatever few crumbs they left behind. If you’re not stockpiling and hiding yours you’re gonna be in for a rude awakening here shortly.

      • TooLittleTooLate

        It’s truly sad, isn’t it? If we had folks that were paying attention, there’s no way any sane person would allow the level of corruption that goes on…. The special interests… high powered lobbys… pork barrel spending… the IRS goes after political opponents…. You have to wonder if they got to justice Kennedy somehow before the SCOTUS brought the obama care case in front…. you have to wonder about general petraeus too…. did they use the NSA tools for gathering his stuff to get him to say what they wanted about bengazi?…. then they promply destroyed his career anyway. This stuff has been in the tinfoil hat area, no doubt but, It keeps coming true, doesn’t it?!?!

  • chilller

    In the last sentence…shouldn’t that read, day of “wreckoning”?

  • jessi

    i was in the usa last year.. .. i am not an usa citizen, just new green card.
    ok, I got an account there for years with 30k$.
    the first question was if i wanted to borrow money?
    what for? I asked
    they said if I wanted to buy more..

    that’s your problem, it’s the banks. seem to me they give easy money to anyone… no need to rob a bank… they give cash for free..

    it seems to me nothing has been learned form the 2008 crash and we are heading for a new crash in 2017.maybe before.

  • Chris

    Any of the charts and data you put up Michael are almost certainly well known to TPTB. These people aren’t stupid or incompetent but devious and corrupt. If you know it’s unsustainable they do too. This would have been either seen coming or actively planned for years ago. The question is what ‘solution’ will they try to implement? Total confiscation of private property? Write off all the debt and go to a cashless system with a ‘mark of the beast’ overseen by total surveillance and round up all the dissenters for the FEMA camps? Allow a collapse and anarchy? Write off all the debt in return for the US and others losing their sovereingty and constitution to a UN run by a group of devious central bankers who caused all this in the first place?

    • Reynaldo Neggle

      One thing is for sure, if you have a loan on something then that something will not belong to you when they take your job and your savings. Give them back your Lexus and your McMansion and find a bridge to sleep under.

  • Sack man

    Word that health care costs coming down due to obamacare. Frees up money for other things. Do a web search for details. Corporate profits to drive markets higher. Higher profit is higher dividend is more taxes collected. USA still worlds number 1 manufacturer. Look it up. Rather work in a retail store or restaurant tan an assembly line. Most agree. You guys really want assembly line jobs in this country? Let china do it. Our stores can sell the products. The stores create low paying jobs but what’s the difference earn $10 an hour in target or an assembly line? My point is jobs are created. But fight the facts. Many banks, supermarkets hiring too Accouning and book keeping jobs in demand. Medical schools have record Enrollment. Remember not both jobs of a married couple need be full time and offer benefits. I can go on. But won’t.

    • harleyrider1989

      ObamaCare is causing increases in all premiums. In kentucky this week it was released by 80% in Indiana 95% and its the same everywhere especially California!

      • iam

        this is misinformation being spread by those who want obama out of office.

        • otter1111

          Three Unions, including the Teamsters, recently wrote letters about Obamacare, saying, “the Affordable Care Act, if not modified, will “destroy the very health
          and wellbeing of our members along with millions of other hardworking

          The Teamsters supported Obama.

  • seth datta

    The billionaires that own the Western nations are well happy that they have caused thsi to disempower us and so they can buy up assets at a fraction of the price when the economy fails.

    • Gene Baugh BBA

      Warren Buffet is sitting on 47B in cash.

  • Tom

    How about paying those who worked their entire life and paid taxes with the understanding that their work would reward them while others sat on their couches and watched TV while living off of the government teat. I say cutting welfare payments to the leaches and paying pensions to those who are owed them is the way to go.

    • Mr. Ditba

      That is a great plan…until you are on welfare.

      • Tom

        Welfare is a way of life for many not the safety net it was meant to be.

  • Vermaphax

    Rome died slow…we will too. It’s like boiling frogs, when it gets late its too late.


    I have had extensive experience working with addicts. Frankly, addicts have to hit bottom before they can turn their lives around. Those that turn their lives around, however, are in the minority. Most addicts hit bottom and stay there. Whether or not we are in the former or latter category remains to be seen. What can not be disputed is that we are going to hit bottom. This nation is addicted to Credit Crack and is unable to break the habit. We are enabled by China and the International Community that still allows the dollar to be the Reserve Currency but the smart money is buying Real Money aka Gold despite the best efforts of the Central Banks to keep the price down. The handwriting is on the wall for all to see and those who can read it are taking steps to “get off the grid”.

  • Dave Webb

    The problem with pension debt is you are dealing with a whole lot of terminal people who might not really give a care as to whether or not they live or die. Especially if it has become apparent that they are terminally ill with something like cancer.
    The criminals out there found a solution. They let themselves get caught!
    Then the government ends up footing the bill for their care in prison. It is better than care at a nursing home where they steal everything you ever worked for.
    The problem is that if Social Security goes all those people are going to be very angry. At that point, who knows what they might do to those in government that allowed this to happen?
    Any life insurance agent will tell you the statistics. Any obit page will tell you the statistics of people between 70-90 and how many die. It is morbid.
    Painting people into an economic disaster like Detroit is doing with filing bankruptcy might not be such a good idea as these jerks think.
    The largest voting section of this country is possibly pension people. You want to see a real revolution get them all mad at you at once. These people are likely to vote out of office everyone currently in office!
    Even Obama recognized that and relented and gave them a token raise in social security in an election year.
    They were foolish to re-elect him. They should have gone for back pay.
    This country’s finances went to bankruptcy when this government and past governments sold the working man down the river in the name of employing all those people in slave labor countries instead of wages we normally earn.
    Someone forgot who pays taxes . . .

  • Gene Baugh BBA

    Meanwhile private debt keeps on contracting. Were it not for the contribution to GDP of government spending and QE we would see a negative GDP numbers and a much worse economy. These factors are barely offsetting the shrinkage of private debt that began in 2008. It appears that private debt will continue to contract for years to come.
    Sequestration and the fact that the government can’t even agree to rebuild a bridge or two isn’t helping.

  • edrobar2978

    This is called ‘Credit
    Super-Cycle’ that boost indebtedness and apparently provides the fake sensation of welfare. Without indebtedness, the western civilization wouldn’t have the material possessions we have nowadays. We have entered into “The Perfect Storm”, huge and unpayable public and private debt and the upcoming and foreseeable decline and shortage of cheap energy which is the most important asset (along with water) of this economic system.

  • harleyrider1989

    The Fed Admits causing the Great Depression by printing to much money between 1929 and 1932. They had to recall 2/3rds of the cash to stabilize the currency……….Now we have mouse Click dollars and an abundancy of printed dollars besides over 100 trillion dumped into the DOW markets to artificially build it back up from the FED. Add in 85 billion a month shown on the books being pumped let alone the Billions not being shown on the books a month and we have a catastrophy in the making equal to 100 great depressions.

  • Jagrick

    Positive thinking isn’t to be had on this site. I guess is good fiction though.

  • Gene Baugh BBA

    Anybody know the total for the wealth destroyed by the collapse of Detroit municipal bonds? I’ve read there will be an 85 to 90% “haircut”. This is how debt disappears in the blink of an eye. Default, foreclosure and repossession.

  • pissobama

    This country put a marxist kenyan into the WH and somehow expected that things would get better. Hope and change baby! Moving forward!

    • Gene Baugh BBA

      One of the r4easons I voted for Obama is because I expected things to get much worse.

      • Gene Baugh BBA

        You want to hate somebody hate Nikolai Kondratiev he’s the guy who discovered the long wave cycle of inflation and deflation.

  • Trailer Park Investor

    Can’t beat those EASY monthly patments

  • Patrick

    What’s the point to work if you can’t save your money and take care of your family. If everything you make goes to helping cities like Detroit, car dealers, large banks and other nations. If other cities start filling like Detroit I will stop working and maybe move out of the US this nation is in big trouble anyway. Maybe Israel cause Israel is doing actually very well. Time will tell.

  • Lori

    What is going to happen when Obamacare kicks in? Things will go from bad to worse and then what? The MSM is trying to make it look like we are fine. We are not fine. The only ones who believe we are fine are the sheeple who do not bother to educate themselves. I love reading comments on this site because everyone here knows what is going to happen and most of us are prepared or are preparing for when the SHTF. Thanks everyone for staying prepared.

  • rentslave

    The only solution is to subject pensions to a means test.

  • Rick Caird

    Tell it to Krugman. For some reason, he seems to believe debt does not matter and is halfway to arguing the Fed shout buy all the Detroit bonds. Then they can issue more to pay the pensions. It seems like a ponzi scheme to me, but the great Oz has spoke.

  • Casino666

    This show us one thing; don’t trust anyone else than your self! To all who read this: Take care of your self, because nobody else are going to! If you have debt, try to find a way to eliminate that debt!

  • Arcanesavior

    Mr. Obama was literally elected to weaken this country, and is doing so. FEMA camps across the U.S.A. as well as hundreds of thousands of plastic coffins traversed across the country, spells trouble. Not to mention, all of the stockpiling of ammunition and confiscation of the weapons we possess rendering us helpless against whatever the government is preparing to impose next.

  • PatFields

    “So where will all of that money come from?”

    That depends on exactly how one defines ‘money’. If in the banknote credit stamp paradigm, it was NEVER POSSIBLE to amortize Debt Principal because the Interest has ALWAYS extended FARTHER than the total amount of negotiable currency in circulation. So, even a single borrowed banknote of principal has, from the outset, been un-payable, when the banknote denominated interest is left to settle the debt. Get it?

    Now, if we ‘think outside the box’, and view the banknotes as PURCHASE POWER expressed in physical form … then there’s PLENTY of REAL MONEY to liquidate ALL debt within a very reasonable period of time. Given that a 1912 dollar was expressed as 100 cents, which has depreciated 98 percent, the banknote is REALLY a commensurate copper-weight to the 2 remaining 1912 cents, or about a 7 gram ‘Copper’ per American banknote.

    There’s MORE than enough copper to convert ALL these banknotes … leave ALL wages, prices and accounts precisely the same in numerical terms and go forward with MONEY that bears NO ACCRUING INTEREST on its float.

    In essence, by PURCHASE POWER, the enitre stupid paper ‘money’ fiasco is ERASED from financial history; where the effect is to simply reset the playing field back to 1912, leaving everyone, great and small, no ‘richer’ or ‘poorer’, but MOST IMPORTANTLY, with the great financial super-structure completely un-disturbed. Armageddon evaporated!

  • Blair T. Longley

    “What we are doing to future generations is absolutely criminal.”

    While that is true, the “we” was not the people generally, but rather, the best organized gang of criminals, the biggest gangsters, the BANKSTERS, that created this runaway debt problem, based on a system which is fundamentally fraudulent, but nevertheless, which fraud is forced by the government to be accepted by everyone else. The source of the “criminality” is much more profound than this article indicates, and therefore, any genuine solutions are much more profound than anything hinted at in most discussions of any “economic collapse.”

    To be serious about this, one has to stop believing that “money” evolved from bartering, and instead see that money evolved from robbery, Bartering through the means of “money” appears as relative phases of the dynamic equilibria of the processes of robbery. The ultimate form of robbery is murder. MONEY IS BASED ON MEASUREMENTS BACKED BY MURDER.

    “Incredibly, a large percentage of the population does not seem to understand these things.”

    It is too superficial and stupid to think that going backwards to gold and silver money is able to resolve the problems created by a privatized, globalized, fiat money system, which depends on the powers of states, that now includes weapons of mass destruction. We now have electronic money, backed by atomic bombs. That is our real problem, and the collapse of the social pyramid of debts, as the numbers continue to be driven NUTS, until there must be some kind of collapse of that, actually we return us to the blatant realities, that money is backed by murder. Therefore, the coming economic collapse is guaranteed to start more genocidal wars, along with democidal martial law.

    Moreover, on a deeper level, THE DEBT CONTROLS ALWAYS DEPEND ON THE DEATH CONTROLS. The real problem we face is how to develop and operate a better murder system, because nothing less than that can sustain a better money system. That problem seems almost impossible to resolve, since the current murder system, as evolved through the history of warfare and militarism, had its success based on deceits: human history made War Kings, whose powers were taken over by the Fraud Kings, the banksters.

    Thus, the whole system is actually a combined money/murder system, which has been amplified trillions of times by advances in science and technology. Meanwhile, the vast majority of people do not want to understand any of that, while those at the top of the current social pyramid want to make sure that the vast majority of people continue to not want to understand how the money and taxation systems actually operate. We are headed towards the exponential growth, as displayed in this chart, and as shown by many other similar lists of social facts like that, FINALLY COLLAPSING INTO CHAOS, AND A SERIES OF SOCIAL PSYCHOTIC BREAKDOWNS.

    Neolithic civilization has become runaway systems of legalized lies, backed by legalized violence, through which EVERYTHING WE DO IS CONTROLLED BY HUGE FRAUDS … THAT “WORKS” BECAUSE THE FRAUDS ARE BACKED BY FORCE. In order to understand our predicament, one has to understand the degree to which we understand almost everything BACKWARDS.

    Almost nobody appears to understand the deeper philosophical aspects to us living inside a Bizarro Mirror World, where society has been controlled by the people who were the best at backing up their deceits with destruction. Some people perceive the runaway social insanities, and that the financial numbers have gone NUTS, with debt slavery transforming into debt insanity. However, almost nobody appreciates the kinds of paradigm shifts that we should go through to understand these problems adequately. The root of the problem is the murder system. There are no “solutions” which do not include radical changes in the murder systems, doing the death controls.

    Collapses ARE going to happen eventually, since the violence can never make the lies become true, but only push society as a whole to become more psychotically controlled. Legalized lies, backed by legalized violence, is STILL building everything on the foundation of LIES, and therefore, still driving society as a whole to become more and more psychotically INSANE.

    However, some new sanity, IF we survive, must be based on facing the fact that human ecology MUST operate through its death controls, and the entire system of political economy MUST operate inside of some human ecology.

    It is clear that human beings are trapped in their own trap, which was the history of militarism operating our real death controls through the maximum possible deceits, which then morphed to become our political economy being dominated by the best organized criminals, namely the banksters, which covertly were able to take control over all social and political institutions, while gradually thereby forcing everyone else to adapt and accept that the foundation of the social system was runaway financial frauds. People who accepted that fraud, and took advantage of it, had more “successful” lives, although everything they were doing was built on foundations of FRAUD.

    Fraud is symbolic robbery, and the most extreme form of robbery is murder. The social systems were based on the history of murder, done both legally and illegally. There are no solutions to this problems other than more murders, of one kind or another, done sooner or later …

    To understand that more deeply requires we understand human lives as energy systems, where energy was never created, nor destroyed, but only transformed. The transformations of energy are understood through the concept of entropy. However, the way that we understand entropy is BACKWARDS. (An arbitrary minus sign was inserted into the entropy equations.) That is the most abstract symbol which illustrates the degree to which we are living inside of Bizarro Mirror World, where everything is proportionately backwards and distorted.


    At present, our society is based primarily upon people deliberately ignoring everything important as much as they possibly can. Therefore, attempting to more seriously discuss these problems appears to be mostly a waste of time … Meanwhile, the exponential growth of the debt insanity situation continues going on and on … U.N.T.I.L. ???

  • Aaron

    So….if things are so bad, why not spend some of your time writing about how to solve the problems. You aren’t any better than the problem if all your going to do is write about it. What’s the solution?

  • Samuel Sprayberry

    Government retirement systems. Another ponzi scheme that will not be prosecuted. We know there is a crash coming, but how about telling us something useful: like when to pull our stuff out of the market to keep from getting wiped out? That would be something useful instead of telling us things we already know.

  • Bailey A Hughes

    The baby Boomers want to collect what was promised to them? You got it ALL WRONG! Those baby boomers paid into the system! They need to pay out hwat they paid in + interest; NOT PROMISED! It”s their money in the first place! NO HANDOUTS! Got it?

  • andrea p

    Let’s get something straight. We didn’t make any financial promises to baby boomers. Those promises were made long before most of us were born. They should have been good stewards with their money. Not enough money in Social Security for payouts. Tough, work until the day you die. That’s the way the system was designed anyway…life expectancy at 62 and retirement at 64. I, as a person in their 30’s, trying to raise two children have a hard time feeling bad for people who want to retire on my dime. They should have planned better and not elected such wreckless spenders to Congress.

    • Thomas Kelly

      They were forced in to SS. And their money was taken out of their paychecks by force. Just look at your next pay stub.

  • Mondobeyondo

    You know what the problem is?

    People don’t want hope. They want money. Faith and money are not the same thing. You say faith can’t pay bills. Oh yes it can.

    Pensions amount to hope. Promises amount to hope, People don’t want hope, they want happy talk. This is where politicians succeed and where many people fail. But if you have no hope, how can you accomplish anything else? Exactly. You’d give up before you ever started. And this is exactly what many people do!! Check the suicide rates in the past several years.

    People confuse hope and faith with reallty. Your earthly aspirations do not guarantee anything, if you have no belief in the supernatural. and if it’s not acccording to God’s Will. Read Hebrews 11:1. Read it again. Then read the rest of Hebrews 11. To make it in this world takes a tremendous amount of courage.

    Your friendly neighborhood gubmint says the pensions will meet (or is that meat, as in steak and pork chops?) their needs. Doesn’t matter. Show us the money?

    You know what else that is? A lack of faith.

    The people lack hope, because they don’t want hope, they want money – and they have no faith. Decline of our nation and our standard of living is guaranteed

  • Mudpie

    We are going to end up with the most twisted and sick dictatorship in the history of the planet Earth. I already feel detached from the U.S.A. and any emotional connection to the present day nation is completely gone. I do feel some pangs re the loss of what was. But, I accept that it is gone and that my countrymen . . . many of them . . . are no longer worthy of my loyalty or love, and that in fact I revile many of our fellow citizens and think that our leaders are pure filth. Go figure. The NSA is probably at this moment training the big guns on little ole me. Sick, sick times we live in.

  • Edwin

    All you people fighting with each other on here are part if the problem

  • Mich

    May I please ask: What is the solution to all this? I see higher percentages of people emigrating, but is there really a better place to go?

  • C

    Where is the section of the chart pre 1950?? Pretty crucial piece of information if you ask me. Half chart is another form of a half-truth. This is another attempt at fear mongering to make money and play off people worry about the economy which nowhere near in the state these types of people above are claiming. Notice the people who are telling the truth and showing how the US economy actually works, stating that the economy will not collapse are NOT selling anything?? Hmmmm. interesting.

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