The US budget picture in black and white
Ever since we first published the TREND letter a decade ago, we have harped about the coming debt disaster the world was facing. Sadly, our predictions are all coming true, but even sadder is the fact that most in the Western world simply do not understand the enormity of the problem or choose not to listen, as the message is too painful.
There is one constant throughout this problem and that is that no one wants to make do with less than they are become accustomed to. Most households seem to understand that at some point you cannot live beyond your means because if you keep borrowing, there is a point where no one will lend you more.
For governments, this seems to be a much bigger challenge as when folks who would not put their family into such a state of indebtedness, seem to change their tune when they get into government. They get blinded by the power of office; the power of giving the people what they want; without regard to whether the country can afford the service.
We are living in a culture of "entitlement" which has been engendered over the past 40 years, and has now brought the western world to a tipping point. We are an investment newsletter business and have no interest in discussing political vents. What we are talking about here is the simple principle of each country living within their means and taking responsibility to protecting their citizens and future generations from paying for the debts that the current government decided to endure.
This is not rocket science. We are talking about only spending what you have. The following clip explains the math that the US needs to deal with. This is not political, it is reality. There will be pain to deal with it now, but if this can is kicked any further down the road, the pain becomes extreme.
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