{"id":35281,"date":"2013-01-13T21:56:35","date_gmt":"2013-01-14T02:56:35","guid":{"rendered":"http:\/\/countingpips.com\/forex-news\/?p=35281"},"modified":"2013-01-13T22:03:55","modified_gmt":"2013-01-14T03:03:55","slug":"gargantuan-and-growing-the-u-s-debt-figure-youve-probably-never-heard-of","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex-news\/2013\/01\/13\/gargantuan-and-growing-the-u-s-debt-figure-youve-probably-never-heard-of\/","title":{"rendered":"Gargantuan and Growing: The U.S. Debt Figure You’ve Probably Never Heard Of"},"content":{"rendered":"

Gargantuan and Growing: The U.S. Debt Figure You’ve Probably Never Heard Of<\/a><\/h3>\n

The widely reported $16.1 trillion federal debt is a drop in the bucket <\/span><\/p>\n

By Elliott Wave International<\/span><\/h3>\n

Financial transparency is a must for U.S. publicly traded companies. But if the federal government had to abide by those same regulations, more Americans would know that the often-reported $16.1 trillion federal debt doesn’t come close to the truth about the nation’s liabilities.<\/p>\n

In a Nov. 26 Wall Street Journal opinion piece, a former chairman of the Securities and Exchange Commission and a former chairman of the House Ways & Means Committee write:<\/p>\n

The actual liabilities of the federal government — including Social Security, Medicare, and federal employees’ future retirement benefits — already exceed $86.8 trillion, or 550% of GDP.<\/p><\/blockquote>\n

The authors say that few people know about the $86.8 trillion figure because that figure is not in print on any federal government balance sheet.<\/p>\n

Federal debt is staggering enough. Municipal liabilities also pose a danger to the nation’s financial health.<\/p>\n

Illinois has an unfunded pension liability of at least $83 billion. It had 45 percent of what it needed to pay future retiree obligations as of 2010, the lowest among U.S. states.<\/p>\n

Bloomberg, Aug. 29<\/p>\n<\/blockquote>\n

The article also noted, “California, with an A-ranking, one level below Illinois, remains S&P’s lowest-rated state.”<\/p>\n

Budget shortfalls in California and Illinois are just the tip of the municipal financial iceberg. Many other state governments are financially swamped.<\/p>\n

How did municipal spending get so out of control? Well, a stupefying story out of Bell, Calif., provides a hint. On Nov. 26, CNN reports that the Bell police chief earned $457,000 a year, and “He is now asking for more money.” In 2010, the Bell city manager resigned after controversy over his $787,000 yearly salary.<\/p>\n

States Are Broke and Approaching Insolvency<\/strong><\/p>\n

… States’ legislatures continue to blow money. For years,
\nstate governments have been spending every dime they could
\nsqueeze out of taxpayers plus all they could borrow. (The
\nlone exception is Nebraska, which prohibits state indebtedness
\nover $100k. Whatever Nebraska’s official position on any
\nother issue, by this action alone it is the most enlightened
\nstate government in the union.) But now even states’ borrowing
\nability has run into a brick wall, because the basis of
\ntheir ability to pay interest — namely, tax receipts —
\nis evaporating. … The goose — the poor, overdriven taxpayer
\n— is dying, and the production of golden eggs, which allowed
\nstate governments to binge for the past 40 years, is falling.
\nThe only reason that states did not either default on their
\nloans or drastically cut their spending over the past year
\nis that the federal government sucked a trillion dollars
\nout of the loan market and handed it to countless undeserving
\nentities, including state governments.<\/p>\n

The Elliott Wave Theorist<\/em>, November 2009<\/p>\n<\/blockquote>\n

If there’s another leg of the economic downturn, expect a further dwindling of tax receipts.<\/p>\n

Finally, consider the wobbly financial dominoes in Europe and what may happen in the U.S. after the first one falls.<\/p>\n

 <\/p>\n\n\n\n
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This article was syndicated by Elliott Wave International and was originally published under the headline Gargantuan and Growing: The U.S. Debt Figure You’ve Probably Never Heard Of<\/strong><\/a>. EWI is the world’s largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.<\/em><\/p>\n

\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Gargantuan and Growing: The U.S. Debt Figure You’ve Probably Never Heard Of The widely reported $16.1 trillion federal debt is a drop in the bucket By Elliott Wave International Financial transparency is a must for U.S. publicly traded companies. But if the federal government had to abide by those same regulations, more Americans would know … <\/p>\n

Continue reading “Gargantuan and Growing: The U.S. Debt Figure You’ve Probably Never Heard Of”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-35281","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/35281","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/comments?post=35281"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/35281\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/media?parent=35281"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/categories?post=35281"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/tags?post=35281"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}