debt ceiling and the financial crisis.

[moissanite69]

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This is it, everyone. Two more days and we'll see a historic change in the US economy. We (the US) either gonna move forward with more debts or we are gonna collapse. "Collapse" here means that our economy will even get a lot worse than it is now. In this debt ceiling bill, expect to see cuts in healthcare, which could affect our jobs. What's your thoughts on this? Scary, though.

 

[Judgment Dragon]

This is it, everyone. Two more days and we'll see a historic change in the US economy. We (the US) either gonna move forward with more debts or we are gonna collapse. "Collapse" here means that our economy will even get a lot worse than it is now. In this debt ceiling bill, expect to see cuts in healthcare, which could affect our jobs. What's your thoughts on this? Scary, though.

Is there a news article on the "two more days"? 😕

 

[readingfiend]

either prospect you mentioned is a bad one. It would take an economic collapse for some sectors of society to wake up and stop expecting goverment to pay for everything.

I have had friends who have had economic collapse. It was terrible for them but it did cause them a permanent change in their financial habits. I hope that we can indeed find the high road between the two extremes you mentioned but it should be a wake up call for ALL of us to get our finances in order. We are all just a small microcosm of the nation at large.

 

[WhiteSnows]

i think they will pass it. They are just playing game now.

 

[moissanite69]

Debt ceiling fails = stock crash, interests up, student loan/grants cut, big cut in Medicare/Medicaid , massive laidoffs!!!!

 

[Judgment Dragon]

i think they will pass it. They are just playing game now.

What is going to pass? 😕

 

[rxlea]

Meh.

 

[Judgment Dragon]

They are talking about the debt ceiling.

805 807 0958
805 275 0456

 

[aussiepharmer]

The answer is simple(although the procedure is complicated) if such extreme thing happens - Time to cross the border or fly away!

 

[Unchained]

Monday will be a good buying opportunity in the stock market. I'd take my chances that they will pass something Tuesday. It's alot of hot air being blown right now. Fear is high which means you should be greedy. Stocks of companies with great balance sheets are cheap now. Check out CAT.

 

[owlegrad]

Monday will be a good buying opportunity in the stock market. I'd take my chances that they will pass something Tuesday. It's alot of hot air being blown right now. Fear is high which means you should be greedy. Stocks of companies with great balance sheets are cheap now. Check out CAT.

👍

EDIT: Not sure what the alot has to do with this though.

 

[WVUPharm2007]

My debt plan is rather simple.

Kill the top 400 richest people...take their money, stocks, and riches. Being that they own literally 50% of the wealth in the US, it would solve everything.

Then give it to me and I'll fix everything.

Thank You for you consideration.

 

[extra07extra]

How will all of this affect student loans and interest rates?

 

[WVUPharm2007]

How will all of this affect student loans and interest rates?

They would, without a doubt, increase. All interests rates would increase.

 

[owlegrad]

How will all of this affect student loans and interest rates?

The same way bad credit affects all loans. Makes them harder to get and raises the interest rate.

 

[CUninja]

They would, without a doubt, increase. All interests rates would increase.

Private loans, yes... most federally held loans for graduate/professional students are fixed at 6.8% (7.9% for Grad Plus) by law and it would take a change in the law to change the interest rate. For undergraduate students, some federally held loan interest rates are not fixed and are likely to rise.

 

[LazyMooch]

I hope the whole thing crashes and burns and we all have to make our way across the dust bowl into California, at which point we get lower than minimum wage jobs picking grapes.

 

[WhiteSnows]

People. the debt ceiling is just another game the US Gov playing. They own so much money now to foreign and they are trying to bring the Value of the Dollar down. If they can do that, the total money they own will be less. For example, if they own $14 trillion today, they will only own $7 trillion tomorrow because the US Dollars lose its value.

So Washington is trying to play the game. They create such a fake conflict so that the world may be convinced that they are fighting. As the matter of fact, they know what they are doing.

The problem is that american people will face the consequences of high loan interests. This may put us back into another recession.

Just my quick thought.

 

[WVUPharm2007]

Private loans, yes... most federally held loans for graduate/professional students are fixed at 6.8% (7.9% for Grad Plus) by law and it would take a change in the law to change the interest rate. For undergraduate students, some federally held loan interest rates are not fixed and are likely to rise.

The subsidized loans are. I.E. only those covering tuition. If you borrowed more for living expenses, it's 2.11% right now.

 

[WVUPharm2007]

People. the debt ceiling is just another game the US Gov playing. They own so much money now to foreign and they are trying to bring the Value of the Dollar down. If they can do that, the total money they own will be less. For example, if they own $14 trillion today, they will only own $7 trillion tomorrow because the US Dollars lose its value.

Um...no. The majority of US debt is owned domestically. It doesn't work like that. The largest foreign holder of US treasuries is China at only 8%...

 

[confettiflyer]

Debt ceiling fails = stock crash, interests up, student loan/grants cut, big cut in Medicare/Medicaid , massive laidoffs!!!!

market would have already crashed then, in fact i think long term t-bill rates actually went down by friday.

i think this is just a bunch of hoopla, we've gone into technical default before (i think 1979? somewhere around there), markets moved a smidge.


yawwwnnnn

 

[Judgment Dragon]

They own so much money now to foreign and they are trying to bring the Value of the Dollar down.

Don't you mean "owe"? 😕

 

[confettiflyer]

People. the debt ceiling is just another game the US Gov playing. They own so much money now to foreign and they are trying to bring the Value of the Dollar down. If they can do that, the total money they own will be less. For example, if they own $14 trillion today, they will only own $7 trillion tomorrow because the US Dollars lose its value.

total misuse of the word "own" vs. "owe" makes your post not make any sense.

Even if I did replace own with owe, your argument for the rationale behind a devaluation of the dollar doesn't make sense.

 

[confettiflyer]

Don't you mean "owe"? 😕

he's been doing that since he joined...haha, just autocorrect it in your head when you read his posts.

 

[WhiteSnows]

Um...no. The majority of US debt is owned domestically. It doesn't work like that. The largest foreign holder of US treasuries is China at only 8%...

I just did a quick look at wikipedia:

Foreign ownership

As of January 2011, foreigners owned $4.45 trillion of U.S. debt, or approximately 47% of the debt held by the public of $9.49 trillion and 32% of the total debt of $14.1 trillion. The largest holders were the central banks of China, Japan, the United Kingdom and Brazil.[38] The share held by foreign governments has grown over time, rising from 25% of the public debt in 2007 and 13% in 1988.

Source: http://en.wikipedia.org/wiki/United_States_public_debt

 

[WhiteSnows]

total misuse of the word "own" vs. "owe" makes your post not make any sense.

Even if I did replace own with owe, your argument for the rationale behind a devaluation of the dollar doesn't make sense.

Because you are so stupid to understand what it means.

 

[confettiflyer]

Because you are too stupid to understand what it means.

lololol hahahahahhahaa

fixed

 

[confettiflyer]

I just did a quick look at wikipedia:

Foreign ownership

As of January 2011, foreigners owned $4.45 trillion of U.S. debt, or approximately 47% of the debt held by the public of $9.49 trillion and 32% of the total debt of $14.1 trillion. The largest holders were the central banks of China, Japan, the United Kingdom and Brazil.[38] The share held by foreign governments has grown over time, rising from 25% of the public debt in 2007 and 13% in 1988.

Source: http://en.wikipedia.org/wiki/United_States_public_debt

you just proved yourself wrong again.

WVU is correct, the majority of debt is held domestically (source: your wiki link, $10.01 trillion of $14.46 trillion, or 69% of TPDO).

WVU is correct, China holds only 8% of debt (source: citation #38 of your link, "China, Japan, the United Kingdom and Brazil holding respectively approximately $1.16 trillion, $910 billion, $345 billion and $210 billion as of May 2011.")


you really should read what you link before you make yourself look even more uninformed, just a little tip to ya know, help you along with life.

 

[owlegrad]

total misuse of the word "own" vs. "owe" makes your post not make any sense.

Even if I did replace own with owe, your argument for the rationale behind a devaluation of the dollar doesn't make sense.

I just tried that, and the post still makes no sense to me, although it is somewhat closer to making sense that way. I guess I am just so stupid to understand it? 😕

 

[WhiteSnows]

you just proved yourself wrong again.

WVU is correct, the majority of debt is held domestically (source: your wiki link, $10.01 trillion of $14.46 trillion, or 69% of TPDO).

WVU is correct, China holds only 8% of debt (source: citation #38 of your link, "China, Japan, the United Kingdom and Brazil holding respectively approximately $1.16 trillion, $910 billion, $345 billion and $210 billion as of May 2011.")


you really should read what you link before you make yourself look even more uninformed, just a little tip to ya know, help you along with life.

I am too busy to sit here and argue with you about the detail. I never said WVU wrong. I just simply copied and pasted as a source to look at later.

Again, it is really stupid to correct a person's grammar. By doing so, it does make you better in english writing. People do not ask you to do so, so don't do it.

 

[WhiteSnows]

I just tried that, and the post still makes no sense to me, although it is somewhat closer to making sense that way. I guess I am just so stupid to understand it? 😕

Okay, for example: you owe me $10 today. I can buy 2 cans of soda for $10 today. Tomorrow, $10 loses its value. I can only buy 1 can of soda instead of 2. Then at the end of tomorrow, you only owe me 1 can of soda, instead of 2. So as a lender, I'll get back less value of things after the US dollar loses its value than when it is higher value.

 

[confettiflyer]

I am too busy to sit here and argue with you about the detail. I never said WVU wrong. I just simply copied and pasted as a source to look at later.

Again, it is really stupid to correct a person's grammar. By doing so, it does make you better in english writing. People do not ask you to do so, so don't do it.

that's fine, i'll disregard your poor grammar and attack your inability to critically read what you link to. I hope you don't do this in school...it's like reading the abstract of a paper and coming to an argument armed with only that. granted i'm not surprised, your posts have consistently been off the mark, i just feel like picking on you today.

point is you pasted something in order to refute someone else's post and now you're claiming you're not refuting it and that you were posting it as if this thread were your personal post-it note, nice try. now you're claiming you don't have time to argue the minutiae of what you posted, even better.

 

[WhiteSnows]

that's fine, i'll disregard your poor grammar and attack your inability to critically read what you link to. I hope you don't do this in school...it's like reading the abstract of a paper and coming to an argument armed with only that. granted i'm not surprised, your posts have consistently been off the mark, i just feel like picking on you today.

point is you pasted something in order to refute someone else's post and now you're claiming you're not refuting it and that you were posting it as if this thread were your personal post-it note, nice try. now you're claiming you don't have time to argue the minutiae of what you posted, even better.

I think you should go back and analyze again to see if I dispute WVU's point or not. In fact, I just merely added the source to his point. And that is all I do. I did not say he is wrong, or he is right. I simply added the link so I can go back and analyze when I got the time. Why do you automatically assume that I tried to prove him wrong?

You are so quick to criticize people without even criticize yourself before you post. That does not contribute anything to any discussion.

 

[confettiflyer]

Okay, for example: you owe me $10 today. I can buy 2 cans of soda for $10 today. Tomorrow, $10 loses its value. I can only buy 1 can of soda instead of 2. Then at the end of tomorrow, you only owe me 1 can of soda, instead of 2. So as a lender, I'll get back less value of things after the US dollar loses its value than when it is higher value.

a devalued dollar benefits debtors, yes; however, that lender that loses money during the transaction has to make up for it somewhere. So in your example, now that you're getting effectively 1 can of soda, you gotta lay off some workers so you can get your 2 cans of soda. Beyond that, next time you lend money, you're gonna charge more for interest in anticipation of the dollar being less when the loan is called back in a year or whenever.

 

[confettiflyer]

I think you should go back and analyze again to see if I dispute WVU's point or not. In fact, I just merely added the source to his point. And that is all I do. I did not say he is wrong, or he is right. I simply added the link so I can go back and analyze when I got the time. Why do you automatically assume that I tried to prove him wrong?

You are so quick to criticize people without even criticize yourself before you post. That does not contribute anything to any discussion.

typical insecurity by saying "this post doesn't contribute."

learn to analyze, don't fail your journal clubs, this is my last post on this side-bar, i'm getting bored.

 

[WhiteSnows]

a devalued dollar benefits debtors, yes; however, that lender that loses money during the transaction has to make up for it somewhere. So in your example, now that you're getting effectively 1 can of soda, you gotta lay off some workers so you can get your 2 cans of soda. Beyond that, next time you lend money, you're gonna charge more for interest in anticipation of the dollar being less when the loan is called back in a year or whenever.

A lender has to lay off workers to get back the 2 cans of soda is another way a debtor says: " it's your problem, I just pay you less than what I owe to you and... whatever you do to make it up is your problem".

And why would I continue to lend a person who can't pay back my money plus interests? A lender is not stupid to do that. China already calls for a new super global currency to replace US dollars years ago when they realized that there is no way the US can pay back its debt.

 

[confettiflyer]

A lender has to lay off workers to get back the 2 cans of soda is another way a debtor says: " it's your problem, I just pay you less than what I owe to you and... whatever you do to make it up is your problem".

And why would I continue to lend a person who can't pay back my money plus interests? A lender is not stupid to do that. China already calls for a new super global currency to replay US dollars year ago when they realized that there is no way the US can pay back its debt.

huh 😕

OH replay = repay. i promised not to make fun of your horrific grammar anymore.

anyway...lenders lend to countries/persons who have a higher risk of default all the time, it's priced into the interest rate paid on the loan.

 

[owlegrad]

Okay, for example: you owe me $10 today. I can buy 2 cans of soda for $10 today. Tomorrow, $10 loses its value. I can only buy 1 can of soda instead of 2. Then at the end of tomorrow, you only owe me 1 can of soda, instead of 2. So as a lender, I'll get back less value of things after the US dollar loses its value than when it is higher value.

I understand the concept of deflation, but to argue that "Washington" is deliberately trying to cause the dollar to lose value in the global econ...never mind, economics has never held much interest for me.

There will be an eleventh hour raising of the debt ceiling. Everything between now and then is posturing.

EDIT: I meant devaluation apparently.

 

[WVUPharm2007]

I just did a quick look at wikipedia:

Foreign ownership

As of January 2011, foreigners owned $4.45 trillion of U.S. debt, or approximately 47% of the debt held by the public of $9.49 trillion and 32% of the total debt of $14.1 trillion. The largest holders were the central banks of China, Japan, the United Kingdom and Brazil.[38] The share held by foreign governments has grown over time, rising from 25% of the public debt in 2007 and 13% in 1988.

Source: http://en.wikipedia.org/wiki/United_States_public_debt

...and like I said, most of the debt is owned domestically. And making the relative value of the dollar shrink as a ruse to decrease relative debt makes no sense in any way...

 

[owlegrad]

huh 😕

OH replay = repay. i promised not to make fun of your horrific grammar anymore.

anyway...lenders lend to countries/persons who have a higher risk of default all the time, it's priced into the interest rate paid on the loan.

You are terrible today!

Although I just want to throw this out there - constantly using the wrong words is not poor grammar. Poor grammar would be incorrect tense, subject-verb disagreement, or violating any structural rule concerning language. Using the wrong words is...actually I am not sure what it is, but I wouldn't call it bad grammar.

 

[WhiteSnows]

huh 😕

OH replay = repay. i promised not to make fun of your horrific grammar anymore.

anyway...lenders lend to countries/persons who have a higher risk of default all the time, it's priced into the interest rate paid on the loan.

Then watch what will happen when the US default this Tuesday. I wish it will happen then you will know that they [washington] will:

- Raise your student, car, house loan's interests
- Increase tax on you
- Cut back medicare and medicaid, you will have less chance to get a job

 

[WhiteSnows]

You are terrible today!

Although I just want to throw this out there - constantly using the wrong words is not poor grammar. Poor grammar would be incorrect tense, subject-verb disagreement, or violating any structural rule concerning language. Using the wrong words is...actually I am not sure what it is, but I wouldn't call it bad grammar.

It is a typo. I corrected after I saw it. It should be "replace".

 

[owlegrad]

It is a typo. I corrected after I saw it. It should be "replace".

Yup, that's the word!

 

[confettiflyer]

I understand the concept of deflation, but to argue that "Washington" is deliberately trying to cause the dollar to lose value in the global econ...never mind, economics has never held much interest for me.

There will be an eleventh hour raising of the debt ceiling. Everything between now and then is posturing.

Devaluation and deflation are different things. Devaluation is taking a fiat currency and having it decrease in value relative to others. Simple: I go to europe, and it costs me $10 to buy a soda.

Deflation is the lowering of the cost of goods/services. Simple: I go to seattle, and it costs me $.45 for a triple-vanilla latte at starbucks. win!

Devaluation = good for debtors. 5minutes lends me $10 today, I pay him $10 next week, but because of devaluation, it'll only be worth $5 in today's money.

Deflation = bad for debtors. 5minutes lends me $10 today, I pay him $10 next week, but because of deflation, my salary went down along with the costs of everything, so that $10 is gonna hurt tomorrow MORE than it hurts today....AND 5minutes gets to buy more triple-vanilla latte's at starbucks next week vs. today.

 

[confettiflyer]

Then watch what will happen when the US default this Tuesday. I wish it will happen then you will know that they [washington] will:

- Raise your student, car, house loan's interests
- Increase tax on you
- Cut back medicare and medicaid, you will have less chance to get a job

1) nope, nope, and nope. my loans are capped at 6.8% so unless congress decides to retroactively raise rates for loans disbursed, it's not gonna happen.

2) well we knew taxes were going up in the future anyway, no surprise here.

3) medicare/medicaid are getting cut regardless of whether the US defaults or not, and again no surprise here.

 

[confettiflyer]

It is a typo. I corrected after I saw it. It should be "replace".

well given your stellar reputation in this thread i figured it was on purpose

 

[moissanite69]

I hope the whole thing crashes and burns and we all have to make our way across the dust bowl into California, at which point we get lower than minimum wage jobs picking grapes.

If we fail to raise debt ceiling, students won't be able to get loans for pharmacy schools, pell grants will be cut/gone, medicare is gone. Your job is most likely gone, too. Interest will be shoot up to sky. Your student loan interest will be 15%, instead of 6.8% or less....🙂 so much fun huh? Massive laidoffs coming, too. And of course, stock market will crash. Dow will go back to 6000 points like 2008.

 

[owlegrad]

Devaluation and deflation are different things. Devaluation is taking a fiat currency and having it decrease in value relative to others. Simple: I go to europe, and it costs me $10 to buy a soda.

Deflation is the lowering of the cost of goods/services. Simple: I go to seattle, and it costs me $.45 for a triple-vanilla latte at starbucks. win!

Devaluation = good for debtors. 5minutes lends me $10 today, I pay him $10 next week, but because of devaluation, it'll only be worth $5 in today's money.

Deflation = bad for debtors. 5minutes lends me $10 today, I pay him $10 next week, but because of deflation, my salary went down along with the costs of everything, so that $10 is gonna hurt tomorrow MORE than it hurts today....AND 5minutes gets to buy more triple-vanilla latte's at starbucks next week vs. today.

I meant devaluation! I blame it on my poor grammar.

 

[WhiteSnows]

1) nope, nope, and nope. my loans are capped at 6.8% so unless congress decides to retroactively raise rates for loans disbursed, it's not gonna happen.

2) well we knew taxes were going up in the future anyway, no surprise here.

3) medicare/medicaid are getting cut regardless of whether the US defaults or not, and again no surprise here.

Washington has history of changing laws to fit its model. Don't be so naive that your student's loan is capped.

If they can't pay or borrow money from foreign, they will take your money to do so.

 

[confettiflyer]

Washington has history of changing laws to fit its model. Don't be so naive that your student's loan is capped.

If they can't pay or borrow money from foreign, they will take your money to do so.

It would take the reversal of TWO laws/regulations to make me pay more on my student loans.

1) up interest rates retroactively, which can happen, but has never happened. i'm too lazy to look at my promissory note, but if it's a contract with a set rate, it can't be changed and any change would be invalidated by the courts (i highly doubt there's a "interest rate is subject to change by congressional action" clause on it).

2) rescinding the College Cost Reduction and Access Act of 2007, unlikely but possible.

i think you're incorrect in that the precedence with these programs are that washington has never clawed back programs in their entirety, the history is they've changed the rules for anyone new going forward but not retroactively (see: high-3 retirement in the US military, rules/regulations as applied to those newly ascended vs. previously served).