Category Debt Crisis

Jun 6 2024

Interest on US National Debt Hits New Record


Posted Jun 6, 2024 By Martin Armstrong

NationalDebtNYCVBillboard

Government spending has consequences. The US national debt has surpassed $34.6 trillion at the time of this writing and continues to grow every minute. America has never been in a deeper deficit. The Committee for a Responsible Federal Budget (CRFB) has reported that America was forced to pay $514 billion in the first seven months of FY2024 on interest costs alone.

This means that America paid more in servicing its debt than on any other program besides Social Security ($837 billion), which is a separate problem entirely. To put it into perspective, the US shelled out $498 billion on national defense, funding 2.5 wars, during this time. Around $465 billion was spent on Medicare, with an additional $355 billion spend on Medicaid, and neither surpassed the amount paid on simply holding onto debt.

US debt to China Buy Bullets
10 trillion Debt Crisis Default

What can be done when the government refuses to curtail spending? Biden audaciously labeled one of the largest spending packages in the nation’s history the “Inflation Reduction Act,” and expects the people to believe that it has not greatly contributed to the rising costs of goods and services. Every week, Biden signs a new check to Ukraine or a climate change agenda, but no one can stop him from draining the Treasury. Even the Federal Reserve is utterly helpless and can do nothing besides sit back and watch as America spirals down.

Imploding this situation is China’s rightful refusal to purchase US debt. Other central banks see how careless US politicians have become with their spending and question if they ever intend to pay off their growing debt. How could they at this point? No one in Washington has a clue on what to do. Instead, they will continue spending with no concern for the long-term consequences that are inevitable.

May 16 2024

American Households Hold Record Debt Q1 2024


Posted Originally on May 16, 2024 By Martin Armstrong 

Debt Burden

The New York Federal Reserve reported that American households set a new record after plummeting into $17.69 trillion of debt, a 1.1% ($184 billion) increase from Q4 2023. Worse, the number of delinquencies is rising as households struggle to make ends meet amid the cost of living crisis. Inflation is not waning, taxes are rising, and America’s debt burden has become utterly unmanageable.

Mortgage balances rose by $190 billion and reached $12.44 trillion by March. People are paying far more in interest alone than they have in recent years. Those who bought in the hopes of refinancing are not in a good position. Auto loan debt rose by $9 billion, reaching $1.62 trillion.

Americans have been attempting to pay off their credit card balances, with overall credit card debt declining by $14 billion to $1.12 trillion. Yet, that was close to a record-high for credit card debt and we tend to see balances lowered after the holiday retail spending spree ends. Consumers do not want to pay those 20%+ interest rates on cards but many are forced to do so simply to put food on the table.

InflationWarAidMeme

Delinquencies are rising – this is a major issue. It is difficult to crawl out of debt once someone is deep within the cycle. “In the first quarter of 2024, credit card and auto loan transition rates into serious delinquency continued to rise across all age groups,” said Joelle Scally, regional economic principal within the Household and Public Policy Research Division at the New York Fed. “An increasing number of borrowers missed credit card payments, revealing worsening financial distress among some households.”

Credit card delinquencies have reached their highest levels since 2012 when America was recovering from the Great Recession. In fact, by the end of Q1 2024, around 3.2% of all outstanding debt was in delinquency. The New York Fed reported a rise in missed payments across all debts, including those 90 days past due.

No foreign nation is coming to offer America a bailout check. The Biden Administration has made it clear that American households are NOT Washington’s priority. We are to continue working and paying taxes in order to fund foreign wars and climate change packages. How else will we house those 7+ million illegal migrants and offer them free healthcare and shelter? How else will we pay off the student loans for millions? How else will we continue to grow the public sector and pay for countless new social programs? Americans are in serious debt, and Washington is all but ensuring this trend continues.

Oct 30 2023

Former WEF Associate Speaks out on CBDC


Blog/Great Reset

Posted Oct 30, 2023 by Martin Armstron

Economist Professor Richard Werner previously partnered with the World Economic Forum’s Global Leader for Tomorrow program. He has since turned away from the organization and has been speaking out against the Great Reset. I do not agree with him on many topics but I do appreciate him speaking up on this topic. According to Werner, the WEF plans to roll out CBDC in stages, with the final stage being a small microchip implanted under the skin.

He claims that this microchip will contain our entire identity and access to the world. The chip will act as a passport, digital ID, and license. Our wallets will be condensed into a chip the size of a grain of rice that we will have on us at all times. “It is a violation of human dignity to inject something under the skin. That’s why you need more persuasion,” he stated.

As with most digital currencies, they will begin by marketing it as a convenient way for past payment processing. Then they will use a fear tactic, such as rising crime or digital hacking, and then tell the people that having an individual universal ID will protect them from lowly criminals. But that will not be enough to convince people and eventually payments and the freedom of movement will only be permitted through the use of these implanted devices.

This will provide governments with complete control over the people. Who will have backdoor access to the data? The globalists who want to form a one-world government. Bill Gates came out in 2017 and said he supported Guaranteed Basic Income, but the technology was not yet there. The elites have been waiting for the introduction of the Digital ID amid the COVID power grab. The shrinking middle class will become dependent on the welfare state as the cost of living everywhere continues to be unsustainable. As I have also warned, the overall digital ID will also be reliant on our social credit score. Disobey big brother and you will be removed from society. Fumble your taxes? You will be de-banked in an instant and prevented from accessing public vicinities or traveling.

Revelation 13:16-17 “He causes ALL, both small and great, rich and poor, free and slave, to Receive a Mark on their RIGHT HAND or on their FOREHEADS, and that no one may buy or sell except one who has the mark or the name of the beast, or the number of his number.

Some claim this is akin to the mark of the beast and the fulfillment of the prophecy of Revelations while others think it is a neat new technology. It is interesting that an ancient text would declare we need a mark on to buy or sell. Religion aside, we should all be concerned over how much power this technology will give to governments as this technology would equate to the loss of ALL freedom.

Jun 8 2023

Major Hotel Chains Shutting San Francisco Locations


Armstrong Economics Blog/USA Current Events Re-Posted Jun 8, 2023 by Martin Armstrong

San Francisco and other blue cities are overrun with crime, permitted by light-on-crime policies. I know numerous people who travel for work, and all they can discuss after visiting cities such as San Francisco and Seattle is the urban encampments and rampant crime that occurs in broad daylight. Companies no longer wish to hold conferences in these dangerous drug-ridden cities, and it is causing hotels to shutter.

The Hilton San Francisco Union Square Hotel, the largest hotel in the city, and Parc 55 Hotel, the fourth largest, are fleeing the city. CEO Thomas J. Baltimore Jr. said that his hotels have lost almost all of their business from conferences and conventions. Park Hotels & Resorts Inc. (NYSE:PK) announced that it has stopped all payments toward its $725 million loan. They want to completely remove these hotels from their portfolio immediately. There is no saving the city at this point, and the smart money is leaving. “Unfortunately, the continued burden on our operating results and balance sheet is too significant to warrant continuing to subsidize and own these assets,” the company politely stated.

Quite a shame as this was once a beautiful city in a prime location. Hotels in San Francisco have to remind guests to park within enclosed, monitored parking garages because theft is so prominent. Some residents would like to turn a blind eye to the growing problem as the homeless population is beginning to outnumber them. The New York Post recently featured an article showing images of the vacant stores throughout the once desirable downtown as retail vacancy rose 6% in Q1 alone. Businesses, such as Whole Foods which was only open for one year, said they were worried about the safety of their employees.

What is the city doing to correct the problem? Nothing. They are downplaying the true crisis and wondering why tourism is nearly non-existent. The $120 million in budget cuts for the police department since 2020 has not helped the situation. Reports state that fewer than 80% of 911 calls are answered in a timely fashion, if at all. This is how cities fall under incompetent leaders who ignore problems in favor of votes.

Jun 2 2023

Senate Passes Debt Ceiling on Schedule


Armstrong Economics Blog/Sovereign Debt Crisis Re-Posted Jun 1, 2023 by Martin Armstrong

COMMENT: Marty, the Senate passed the Debt Ceiling. It is amazing how Socrates shows there was no debt crisis. As you wrote “When we look at the Array, we do not see a crisis with the debt ceiling.”  I do not know how it does this, but what you have created is truly a gift to humankind.

CLB

REPLY: I never expected that linking everything together would predict wars, civil unrest, or financial crises. There is a lot we can learn from Socrates.

Jun 1 2023

Debt Ceiling & War Crisis


Armstrong Economics Blog/Bonds Re-Posted May 31, 2023 by Martin Armstrong

When we look at our Computer’s timing arrays for the 30-year bond, it did show a target last week with a Directional Change. So far the market has held that low and has been consolidating. When we look at the Array, we do not see a crisis with the debt ceiling. However, the next Fed Meeting is July 25-26 and when we look at our Array, we see that is when there is a Panic Cycle.

There is NOBODY in Washington who is ever interested in actually paying off the debt. Even AOC has come out and said there should be no debt ceiling – just print until the cows come home, but that may be a problem when Bill Gates and the WEF want to kill all the cows.

In that regard, we are only making things chaotic. The government should just print the money and not borrow in the first place for they are competing with the private sector which is the ONLY real creator of worthwhile jobs.

Meanwhile, the Neocons are hoping to start a war with massive air drills in Europe going to even Church, which they do not believe in God, and lighting candles just in case he does exist to please make Russia attack. If not, hell, they will just say Russia attacked as they lied and claimed that Vietnam attacked us and Iraq had weapons of mass destruction. War is on the horizon and that is the MOST inflationary influence of all.

May 31 2023

Byron Donalds and Chip Roy Are Furious About McCarthy Debt Ceiling Deal – House Freedom Caucus Says “NO”!


Posted originally on the CTH on May 30, 2023 | Sundance 

As details begin to emerge, many of the House Republicans are furious at Kevin McCarthy for the deal to lift the debt ceiling he has brokered with Joe Biden.

Suddenly, the prior battle and construct of the House Rules Committee is becoming important.   While Kevin McCarthy may have the 218 votes on the floor of the House to pass the deal, he first has to get it out of the House Rules Committee (HRC).  If three Republicans oppose it in the HRC, McCarthy cannot get it to the floor.  Chip Roy and Ralph Norman are on the HRC and oppose the bill.   Thomas Massie is also on the HRC but appears to be supporting Kevin McCarthy (lol, because muh principles).

https://youtube.com/watch?v=BMxbCiQNXIs%3Ffeature%3Doembed

Byron Donalds also delivered a strong rebuke of the McCarthy deal, as outlined below:

https://youtube.com/watch?v=S8OJycSQM_E%3Ffeature%3Doembed

WASHINGTON DC – […] The powerful House Rules Committee will spend Tuesday afternoon debating and — ultimately working to pass — the bipartisan debt deal, requiring a simple majority of at least seven votes on the panel to come to the floor. But some conservatives, including Rep. Chip Roy (R-Texas), a committee member, have signaled they may use their power on that panel to block the debt plan from receiving a full House vote.

“I’m going to do what’s in the best interest and this bill is not in the best interest of the country. That is why Democrats are voting for it,” said Rep. Ralph Norman (R-S.C.), another conservative who sits on the Rules panel and has suggested he will oppose the bill during the panel’s meeting.

[…] Under the panel’s current makeup, Rules Chair Tom Cole (R-Okla.) can lose two GOP votes — along with all four Democratic votes — and still advance the bill.

Senior Republicans believe that’s exactly what’s going to happen, according to three people familiar with the discussions. Norman and Roy haven’t explicitly said they will oppose, though Massie is expected to vote in support of the measure going to the floor.

GOP Whip Tom Emmer (R-Minn.) said that he is “confident” that the bill will hit the floor on Wednesday, noting that Rules would be considering amendments. Members submitted more than 55 amendments to the debt deal, most of them from Republicans but some from Democrats as well. (read more)

Rep Dan Bishop: The bill is bad

May 29 2023

Sunday Talks, Kevin McCarthy Makes His Case for the Debt Ceiling Bill


Posted originally on the CTH house in May 28, 2023 | Sundance 

House Speaker Kevin McCarthy appears on Fox News Sunday to defend his deal with Joe Biden for a debt ceiling increase.

In the past 24 hours many fiscal conservatives have criticized McCarthy for the terms of the agreement. In this interview, McCarthy walks through the details of the terms as he constructed them and pushes back against some of the criticism.  WATCH:

https://youtube.com/watch?v=mM7IpA49-MI%3Ffeature%3Doembed

As soon as the bill is in written form, we will be able to make a better determination.  At this moment this is all hearsay based on what people think the legislation says.

May 25 2023

The Debt Ceiling = Pi $31.4 Trillion


Armstrong Economics Blog/Sovereign Debt Crisis Re-Posted May 24, 2023 by Martin Armstrong

COMMENT: Hello Martin,
The debt ceiling is pi!! = 31.4 trillion $
Coincidence? 😜
Best regards from Vienna and thanks for what you are doing.
Ralf

REPLY:  Yes, very interesting. This is no doubt the major turning point on debt and this is on a global scale. It is not the collapse of the debt just yet nor the dollar.

May 25 2023

The GOP’s Debt Ceiling Demands


Armstrong Economics Blog/Politics Re-Posted May 24, 2023 by Martin Armstrong

The Republicans and Democrats are refusing to agree on the debt ceiling crisis. The government will be unable to pay its bills and the US will default if an agreement is not reached. Yellen has reached out to every media outlet and large corporation in the US to warn of the “catastrophic” consequences. Of course, they’ve always managed to increase the limit in the past as America cannot afford to default on its debt obligations. The Democrats insist on spending with no end in sight, while the Republicans are demanding some sort of budget. Biden and McCarthy met on Monday to discuss, but neither side will budge.

Biden said the GOP is taking an “extreme position,” but what are they demanding? The GOP wants to set discretionary federal spending at $1.47 trillion for the next fiscal year, with an increase of only 1% in future years. The Congressional Budget Office (CBO) said this would reduce the deficit by $4.8 trillion in the next decade.

The promise Biden made to students must be repealed for the Republicans to accept the ceiling. Biden implemented this policy to buy young votes and had no fiscal plan in place to finance such a lofty goal. The GOP believes student loan payments are being unfairly subsidized by millions of American taxpayers, many who already paid off their own student debt. Biden’s plan also does nothing to address continually rising tuition costs. The CBO believes this cut will save taxpayers about $460 billion over the next decade.

Biden’s IRS Army must also be defunded. The GOP wants to rescind the $71 billion that the Biden Administration used to hire 87,000 new IRS agents. We never had a need for so many agents in the past, and it is unlikely that they will shakedown $71 billion from average American families.

The Republicans also want to take back unobligated COVID relief money. Six separate bills were passed between 2020 and 2022 and the government is still shelling out money for a pandemic that has ended. The CBO stated this would save the US $30 billion in spending over the next 10 years.

The climate change agenda is costly. Republicans are demanding that Biden eliminate some of the tax breaks his administration provides to green-friendly companies. They’re negotiating exactly how to position some of the perks for biofuel. In general, the CBO believes this will save the US $570 billion over the next 10 years.

Increasing America’s ability to become energy dependent is crucial. Biden ripped away America’s ability to function without energy exports on his first day in office. The country needs coal, natural gas, and oil to function and energy inflation remains a serious problem. The energy bill, labeled HR1 as it is of top importance, would also boost production of lithium, cobalt, nickel, and other minerals.

The Republicans would also like to limit social programs and government handouts. Able-bodied adults under the age of 50, without dependents, must work a minimum of 20 hours a week or they may lose their SNAP and food stamp benefits. Those who are unemployed but on Medicaid and able-bodied will also be required to work a part-time job. The CBO stated 15 million Medicaid recipients would be required to work part-time, and 1.5 million could risk losing federal funding.

Unsurprising since the neocons are on both sides, no one has asked Biden to end the blank checks to Ukraine. America has sent hundreds of millions to Ukraine and is receiving nothing in return. Our own border is overrun and yet we just pledged another $300 million of American taxpayers’ money to secure Ukraine’s border. The funding for this war will create unprecedented inflation and cripple our economy.