How Long Do You Think It Will Be?

[Gobears81]

The U.S. government is on a glide path to pay as much in interest as it spends on Social Security. The Congressional Budget Office's latest projections show interest payments equaling Social Security over the next two decades, overall debt payments reaching the highest level ever and overall spending accounting for the largest share of gross domestic product since World War II, David Harrison reports.

The good: The U.S. is paying more in part because interest rates are rising. Rates are rising because the economy is strong.

The bad: Rising government-debt levels and interest rates would reinforce each other. High debt levels would push interest rates up further, and higher debt payments would boost debt.

The ugly: With the budget already stretched and record levels of debt, Congress and future administrations will have less flexibility to respond to economic emergencies.

I admittedly skipped the first 41 pages and not to get carried away with liking your posts, but these are some important issues. The Fed has expressed concern because of the tax cuts being effectively a stimulus in a time of economic prosperity where, if anything, a more hawkish policy is appropriate. The stock market and economic expansion has been getting a bit long in the tooth and the stance that tax cuts pay for themselves is a flawed one. With Social Security dipping into its trust fund for the first time and Medicare also running out of funds, there is somewhat of a perfect storm for government funding if a recession does hit in the next couple of years. That sounds to be synonymous with a CBO report released yesterday. With that said, I read somewhere that the flattening yield curve may not be as dire of an issue as in the past, due to the central bank flooding the market with bond purchases.

 

[Joe Flacco]

https://www.usatoday.com/story/mone...ty-myths-and-reasons-why-overblown/725288002/

 

[Gobears81]

View attachment 35896

https://www.usatoday.com/story/mone...ty-myths-and-reasons-why-overblown/725288002/

In itself, tapping SS funds is not so awful, but tweaks would need to be made. In the current political climate (or of the past 18 years), action won't be taken until there is a crisis since no politician wants to say that you have to pay more, receive less, and/ or raise the retirement age. They want to only deliver positives, such as free money, to improve their re-election chances.

 

[Joe Flacco]

In itself, tapping SS funds is not so awful, but tweaks would need to be made. In the current political climate (or of the past 18 years), action won't be taken until there is a crisis since no politician wants to say that you have to pay more, receive less, and/ or raise the retirement age. They want to only deliver positives, such as free money, to improve their re-election chances.

I don't know. I see the current administration taking action before there is a crisis. A lot of action being taken.

 

[Joe Flacco]

A booming economy solves a lot of problems.

 

[Gobears81]

A booming economy solves a lot of problems.

Where I am in the country might be where I'm a bit jaded-Illinois has a deficit and with the pension issue not solved, the city has a deficit, etc. And that's in good economic times! So for me to see tax cuts that aren't reconciled with like-kind budget cuts immediately screams mismanagement and a potential future crisis. But I'm keeping an open mind that this notion could be entirely wrong

 

[Joe Flacco]

Where I am in the country might be where I'm a bit jaded-Illinois has a deficit and with the pension issue not solved, the city has a deficit, etc. And that's in good economic times! So for me to see tax cuts that aren't reconciled with like-kind budget cuts immediately screams mismanagement and a potential future crisis. But I'm keeping an open mind that this notion could be entirely wrong

I think we are in okay economic times. I think good times are coming.

Media seems to focus on shorter time frame cycles but not many seem to be talking about the super cycles like 40's to 60's and 80's to 2000. There are recessions, corrections, and bear markets within these super cycles but what is important is we are in one of these super cycles.

 

[Addie]

They wouldn't send them out if didn't work. More debt when debt cost is rising. tick, tick, tick.




https://www.cnbc.com/2018/06/27/loa...-all-the-stops-to-get-people-to-borrow-m.html

 

[glenn walker]

I would love to see a stable market in my lifetime- In California it's seems that since about 1980 its a boom and bust about every 7-8 years - Some less than others but we are once again in scary territory with the median house in Los Angeles County at $600,000 and that is a 1,200-1,500 house built in 1930 to 1965 in a neighborhood that I would not walk in at night.

When is a top ? I have no idea because it appears nobody learned anything from the big-meltdown of 2008 to 2014 because we Reinflated and now it's like freight train heading down a mountain with no brakes.

My best laugh was a few weeks ago I was driving some comps and the new owner was standing in the front yard so I got out and asked him if I could take a photo of his house - He replied sure and by the way how much do you think it's worth ? I said well didn't you just close escrow a few weeks ago at $700,000 ? Yes but we had a 40 day escrow and have you seen the two new listings up the street they were just put on the market at $750,000 and they are not as nice as mine LOL

 

[TRESinc]

He replied sure and by the way how much do you think it's worth ? I said well didn't you just close escrow a few weeks ago at $700,000 ? Yes but we had a 40 day escrow and have you seen the two new listings up the street they were just put on the market at $750,000 and they are not as nice as mine LOL

yep, that's why we only appraise castles and mansions - every house is the best one on the block according to the owner/borrower