National Debt now over $9.948 Trillion... approaching 70% of US GDP

[featherman]

increasing about $2.56 billion per day.Likely reach the $10 trillion threshold sometime in October before the election.

http://www.brillig.com/debt_clock/

Increase under Bush is something over 4 trillion

http://www.cbsnews.com/blogs/2008/09/29/couricandco/entry4486228.shtml

Bloomberg News WASHINGTON–Treasury Secretary Henry Paulson's $700 billion (U.S.) proposal to stabilize the banking system may push the national debt to the highest level since 1954, threatening an erosion of foreign appetite for U.S. bonds.

The plan, which asks Congress for funds to buy devalued securities from financial institutions, would drive the debt above 70 per cent of gross domestic product and the annual budget gap to an all-time high, possibly exceeding $1 trillion next year, economists estimated.

"This is sobering, absolutely sobering, even to someone who doesn't drink," said Stan Collender, a former analyst for the House and Senate budget committees, now at Qorvis Communications in Washington.

http://www.thestar.com/Business/article/504691

[tama]

1. How much

is that as percentage of GDP (which is hoax, but anyway)?

Is the Federal Budget financed by quarter of debt or now even more?

PS: last time I look (this morning) the number was still below 9,9 - increasing by hundreds of billions per last few days.

[AntiFascist]

2. and when the market for US bonds erodes...

the value of the US dollar could drop further, interest rates will have to increase, and there could be hyperinflation...correct?

[Hannah Bell]

3. it's been higher. question is, are we making things to pay it off.

[Selatius]

4. At the height of World War 2, the US borrowed as much as 140 percent of its GDP to pay for it.

Of course, that war was won, and every president since then has paid down the national debt. It was Reagan who broke that trend. He pretty much reversed any efforts made by Eisenhower all the way to Carter, and Bush Jr. reversed any gains made under Clinton to pay off the debt:

[Hannah Bell]

5. yep, but you notice the high debt fdr to ike didn't seem to impede

business & production, did it?

the debt is a red herring. the issue is who's producing what.

[Selatius]

7. Back in those days, the US produced all the products it consumed. Today, that's not true anymore.

We pretty much witnessed most of America's manufacturing capacity destroyed when the rich started sending the manufacturing jobs overseas to hellhole dictatorships like China or weak democracies with little to no protection for labor or the environment.

[Hannah Bell]

8. this is my point. reducing debt level just makes us poorer if we don't produce tangible

goods.

the debt is a sideshow. If i make 50K/year and take out a loan for 50K to buy a house, am i in trouble?

Only if i don't have a job.

[whosinpower]

6. not really

Over the years, the market has switched form manufacturing goods to sell stuff - primarily because someone would always be willing to make those goods cheaper - and so the market diversified to creating wealth by other means. Supply and demand economics was touted as old school, and those big money players soon recognized that there was too much supply and not enough demand - so they put their money elsewhere to gain a higher profit ratio. And one where they thought money was always safe and secure - mortgage securities. Problem is that without a broad and diverse manufacturing base - those jobs left and the housing market began to flounder with the public facing ever growing economic pressure. Then Bush came up with another brainwave - an homeowner society and eased banking regulations to allow for the sub-prime fiasco. Problem with the Bush plan is that is was never meant to help out the struggling homeowner - it was meant to make it easier for banks to give out mortgages. Banks then bundled those mortgages together and resold them - several times over - this was all under the vision that homes would always increase in value. This inflated the cost of a home that had nothing to do with main street economics.

Wall Street also created these wonderful things called credit default swaps that flew under the radar of any regulatory system. They traded them always under the guise that home values would increase - but when they decreased, then the homeowner defaulted - and the CDO's became due.

This was all under the guise that those middle class manufacturing jobs could be irrelevant and wealth would still be created on paper - given an arbitrary value set by the market - and the american consumer would still consume goods and services because they still generated wealth.