Iousa

[nejar462]

America's 100 trillion dollar debt.

http://www.lewrockwell.com/walker/walker34.html

http://www.agorafinancial.com/iousa.html

I'm very excited about this movie. I already preordered a ticket and plan on going Thursday to my local theater to watch it.

I really recommend this to anyone who is interested in the financial debt, as I'm beginning to realize this is by far the biggest problem facing America. I already knew before, but now I'm starting to believe that all of America's other problems are quite frankly trivial.

The only solution I see would be to slowly eliminate Social Security and Welfare, reduce all government expenditures, and dismantle the foreign empire. To prevent future problems, use something solid to back the dollar.

[Nik00117]

I'm actually kinda glad i'm in a position where I am. I suspect this debt will slap america if the face in the very near future.

However if america strats to hurt, so will the rest of the world, just not as badly.

[Reko]

I'm confused... is this about national debt (war, social programs, etc) or about personal debt (credit cards, lines of credit, etc)?

[Dkalban]

national i believe

[nejar462]

This is the national debt including Medicare and SS benefits.

[nejar462]

I saw the movie, couple points.


1.) The movie was not dry at all, it was very entertaining and had me laughing out loud at a few points.

2.) The movie has little to no factual errors as far as I could tell, I read up on the topic beforehand, and also the national debt is one of my pet peeves.

3.) If anyone believes anything threatens America's existence more than fiscal irresponsibility I'd like to have a friendly debate with them, the movie uses clear and devastating logic to show that this is a systemic problem, that simply blaming the Iraq War, Bush's Tax Cuts, or earmark expenditures is not enough. The problem is within the attitude of Americans and the government.

4.) Conquest through ownership. The movie does a great job of showing how the foreign debt and trade deficit could be used against America with far more devastation than any simple terror attack (beyond ones that use large scale nuclear weapons, and even then, its comparable).

There was a town hall meeting as well right after it. This went very well, although I didn't agree with all the speakers points. The surprising low point of the town hall meeting was actually Warren Buffett.

a.) He kept talking about human ingenuity would save the day and Americans shouldn't worry. This is crazy and actually flies against the value investing philosophy he subscribes to. Human ingenuity is a nice bonus, its not something to rely on because research and invention are inherently not reliable (which he has said time and time again, and why he doesn't invest in technology companies). Also this implies the fantastic, that Americans are somehow smarter than other people and other people can't become innovative.

b.) He makes a confused point about how American companies don't have high capital requirements, so the trade deficit isn't bad. This is insane, because he has repeatedly claimed he doesn't understand technology companies, yet he uses them as examples. For example, he cites Google as a company that doesn't require a lot of capital, but it requires huge data processing centers and advanced research facilities, so I'm guessing it requires capital investment. Not the same type as a steel manufacturing company, but capital investment is capital investment and it can only be obtained through savings.

c.) He makes an inane comment about how he would have rather been born in American than any other company. Hindsight is 20/20. I'm sure someone born in London in the late 1800's would feel the same way about England, but America dominated the 1900's. Simply because we are prosperous now doesn't mean we always will be. What should be foreboding is that Americans are investing overseas more and more, and getting better results than those investing in America.

d,) When asked about what the average American could do about national/personal debt, he simply replied, "Just be your best." This is a pointlessly vague answer. You could reply almost any question with that answer. "How do I pick up more girls?" "How do I become a better weightlifter" "How do become a good friend/family member?"

e.) He claims repeatedly "You don't make money betting against America." However, he himself has made money betting against American currency, and he is very pessimistic about the American dollar.

I'm hoping old age hasn't finally caught up with the legendary Oracle, or perhaps he just had an off day.

Overall the movie and the townhall meeting afterward were fantastic. I'd give the movie a 10/10, and say everything single American, especially then ones in Congress and the White houses, should watch this movie before making any fiscal decisions...

[Reko]

I haven't seen the movie, but a couple of points I think in bold.

I saw the movie, couple points.


1.) The movie was not dry at all, it was very entertaining and had me laughing out loud at a few points.

2.) The movie has little to no factual errors as far as I could tell, I read up on the topic beforehand, and also the national debt is one of my pet peeves.

3.) If anyone believes anything threatens America's existence more than fiscal irresponsibility I'd like to have a friendly debate with them, the movie uses clear and devastating logic to show that this is a systemic problem, that simply blaming the Iraq War, Bush's Tax Cuts, or earmark expenditures is not enough. The problem is within the attitude of Americans and the government.
I would like to have a friendly debate although I am not sure I am completely qualified to know enough to defend my stnace, which is different than yours

4.) Conquest through ownership. The movie does a great job of showing how the foreign debt and trade deficit could be used against America with far more devastation than any simple terror attack (beyond ones that use large scale nuclear weapons, and even then, its comparable).
See above
There was a town hall meeting as well right after it. This went very well, although I didn't agree with all the speakers points. The surprising low point of the town hall meeting was actually Warren Buffett.

a.) He kept talking about human ingenuity would save the day and Americans shouldn't worry. This is crazy and actually flies against the value investing philosophy he subscribes to. Human ingenuity is a nice bonus, its not something to rely on because research and invention are inherently not reliable (which he has said time and time again, and why he doesn't invest in technology companies). Also this implies the fantastic, that Americans are somehow smarter than other people and other people can't become innovative.
An investing philosophy is different form America on the aggregate. He doesn't invest in the tech companies because he doesn't believe in it, but rather because its so hard to predict where it will go, has high R&D costs, etc which make them for poor investments unless you are really on top of the game and can find solid companies. From a national standpoint, SOMEONE will (or can) be the one to step up and help find a solution. He just doesn't know who will do it or what that solution will be. People thought we would have flying cars by this time, instead we have HD, flat panel porn.


b.) He makes a confused point about how American companies don't have high capital requirements, so the trade deficit isn't bad. This is insane, because he has repeatedly claimed he doesn't understand technology companies, yet he uses them as examples. For example, he cites Google as a company that doesn't require a lot of capital, but it requires huge data processing centers and advanced research facilities, so I'm guessing it requires capital investment. Not the same type as a steel manufacturing company, but capital investment is capital investment and it can only be obtained through savings.
If I am not mistaken a capital investment can be had in the form of a loan

c.) He makes an inane comment about how he would have rather been born in American than any other company. Hindsight is 20/20. I'm sure someone born in London in the late 1800's would feel the same way about England, but America dominated the 1900's. Simply because we are prosperous now doesn't mean we always will be. What should be foreboding is that Americans are investing overseas more and more, and getting better results than those investing in America.
And foreigners have invested here as well. You have to look at your options, if everything has done extrememly well investment wise, you may be over paying to stay here. Likewise, if another economy (or market) has tanked, you can potentially get a better return there as they come "back to life" even if it is another country. Nothing wrong with that. More options also keeps everyone honest.

d,) When asked about what the average American could do about national/personal debt, he simply replied, "Just be your best." This is a pointlessly vague answer. You could reply almost any question with that answer. "How do I pick up more girls?" "How do I become a better weightlifter" "How do become a good friend/family member?"
I don't know that people can do much about the national debt other than elect politicians that won't add to it (hahahaha)

e.) He claims repeatedly "You don't make money betting against America." However, he himself has made money betting against American currency, and he is very pessimistic about the American dollar.
He is pessimistic about the dollar because of what has been happenign with the interest rates. Most people are or have been. As far as I know, he hasn't been outright shorting the dollar, but more or less investing heavily in companies that are based in other currencies, or in bonds that are as well. That way he earns areturn form the business/bond and also a premium for how that currency does vs the dollar. Geroge Soros, I think, outright shorted the... um... (this part of my memory is real hazy) pound I think it was when Europe was untying all the currency from each other. I don't remember how that all worked out but there was some issue with the eurpopean currencies being linked to the mark or something, and they removed that and he put heavy shorting pressure on what he believed was already over valued and made a killing on it. People like to make money and when they see an opporunity they will take it.
I'm hoping old age hasn't finally caught up with the legendary Oracle, or perhaps he just had an off day.
Nah, he just has more money then he knows what to do with

Overall the movie and the townhall meeting afterward were fantastic. I'd give the movie a 10/10, and say everything single American, especially then ones in Congress and the White houses, should watch this movie before making any fiscal decisions...

I think our personal debt (credit cards etc) is a problem that we cannot let get out of control. Maybe it already is I don't know. National debt however, I think isn't quite that big of a deal. Sure, it would be nice if that was in my back account, but thats not really how it works.

I'm kind of curious to see what Shooter thinks of all this, as he probably knows more about this stuff than all of us combined.

[nejar462]

I haven't seen the movie, but a couple of points I think in bold.


I think our personal debt (credit cards etc) is a problem that we cannot let get out of control. Maybe it already is I don't know. National debt however, I think isn't quite that big of a deal. Sure, it would be nice if that was in my back account, but thats not really how it works.

I'm kind of curious to see what Shooter thinks of all this, as he probably knows more about this stuff than all of us combined.

1.) I'd like to avoid a prolonged debate. Not because I wouldn't enjoy it, but I don't know if I have time or energy. (Currently working insane hours.) LOL So I guess you win. I'm guessing any debate we'd have would be the fact you'd have Keynesian beliefs while I have Chicago/Austrian beliefs in economics.

2.) Technology is hard to predict, which he admits readily. Why is he predicting we will out invent ourselves out of the debt? What if there is an overall large scale slow down of technological progress? What if the innovation happens to happen somewhere else? You can't just guess it will happen. It might happen, but you shouldn't prepare for the future in the hopes it will. Aren't we innovative now? Why haven't out innovated ourselves from this current debt? Are we going to be smarter in the future?

3.) You have to pay off those loans eventually. Growth can't be financed through debt forever, you need to eventually be able to fuel growth from profits.

4.) To be fair, there are many reasons to invest overseas beyond pessimism over the dollar. However, simply because America was the best for the last 100 years doesn't mean it will be the best in the future, especially if we don't deal with the problems.

5.) Well you're right, but active campaigning can be used effectively as well. The personal debt can easily be addressed by Americans as individuals.

6.) I remember he took a possession with the Brazilian Real, I'm not sure if he actually shorted, he simply realized it would lose value. He made bets which were based on the fact the dollar would decline, effectively betting against America and winning. I don't remember his actual bets I just know he thought the American currency would be devalued.

7.) Everybody gets old sometime. I work with a lot of aging scientists, unbelievable what can happen to once brilliant minds. Plus, Buffett is not known to take care of himself very well (coke, burgers, and lack of exercise) so you'd expect someone like him to go faster than your average WBBer.

Buffett also made another embarassing error. You'd have to watch the movie to understand it, but basically he said that the debt the movie lists at 53 trillion dollars doesn't take into growth of the economy, so its not really severe, however, it clearly did. Another panelist had to point this out to him. This is kinda a rookie mistake, not what you'd expect from the greatest investor who's ever existed.

[Reko]

on #1) you are probably right, but I wouldn't be certain I am right, I jsut think that I am lol. It may very well be a school of thought thing like politics.

[mickyjune26]

That movie looks very interesting, especially since the US comptroller of Clinton's era contributed heavily to it.

Basically when it becomes a big problem, we will stop spending on many non-military divisions, taxes will go up, and other bad things will happen. All in all, if we as individuals stay out of debt, invest wisely, and don't buy ourselves into a corner, we should be okay.

Worst case scenario, I'm ready to hop to another country if needs be. They will always need computer teachers in other countries.

[Reko]

I thought Clinton had a budget surplus? Or maybe in one of his terms at least?

[mickyjune26]

Yes, the 90's was a great time financially for the US. The tax surpluse was spent within Bush's first term "fighting terrorism".

[nejar462]

While Bush's spending has been far from disciplined, Bill Clinton got the benefit of growing internet bubble, which spiked tax revenue artificially.

[anelka]

Bush must be the only leader in world history to cut taxes before going to war.

In the future, any such warmongering should be funded by high taxes on the contractors who benefit from defence spending.

[mickyjune26]

Bush must be the only leader in world history to cut taxes before going to war.

In the future, any such warmongering should be funded by high taxes on the contractors who benefit from defence spending.

That sounds like a good idea. Except then a governmetn org would be even more officially (vs the current unofficial) profiting from wars, lol.