Federal government spending is out of control. No political will to tackle the problems. Everyone just want to get re-elected. Low interest rate environment has inspired much of corporate debt.
John Burris They are just interested in the power and prestige of public office. John McCain could have done very well in the private sector. He spent 21 million of his own money to remain in office.....
John Burris Seriously believe that? Many politicians remain in politics for years not doing anything. They pander year after year to their base and blame opposite party for their lackluster performance.....
How come no one points out that the majority of the federal budget is due to military spending? Cut the foreign military adventures and put the money into rebuilding the US economy. No crash needed.
John Burris ......look at Amason stocks....... 160 times cash flow is sooo over valued. And barely profitable....... the owner makes his money on selling stocks. The American stock market is hugely over sold.
Unfortunately companies are normally under pressure to please shareholders in the short term (quarter to quarter). This causes CEOs to focus note so on short-term stock performance over longevity. A good portion of upper managments compensation is directly linked to stick performance for the year as well
The larger the corporation the lower the return on investment (normally) due to the law of large numbers. So if a company wants to increase revenue by say 10% they will turn tho taking on massive amounts of debt to fund their short term growth and hope they can pay it off over the next 10 years with the increased cash flow while pleasing shareholders be having revenues go up in the short term.
Corps use hundreds of billions of debt each year to buyback shares to lower share count which increases earnings per share. So you can get higher earnings on softer top line growth.
Debt is a Balance Sheet item and isn't a measure of profitability. The interest paid on servicing debt has an effect on profitability and if the interest rate is low then it has less effect on profit.
Yeah, the problem is that all the money generated and loaned went into buying acquisitions and equity, rather than generating value. Now things are slowing (business cycle) and it is time to pay the piper. If there is a bailout we absolutely need to require that these loans go into actual new growth versus consolidation. It has been the ultimate mismanagement of the economy by the republicans and trump to run such deficits when we are doing well, and cutting taxes now, before we need stimulus. Terrible.
A healthy economy has intentionally been sabotaged. The quantitative easing encouraged more debt and inflation. Interest rates rise to counter that but they cant now because it would cause an economic collapse. The only solution is drastic spending cuts.
I got have the correct the Gentleman. It's a first world countries deficit (and a big one at that) behaving like a third world country. I'd say HQE∞ Hyper Quantitative Ease ad infinitum let's show Venezuela how a hyperinflation looks like. FNC and FBC will dig.
America manufacturing base was offshored in the 80s to enrich wall street at the expense of American blue collar workers. Goods that were once made in American factories are now imported and paid for with borrowed and printed money. This is the sole reason America today runs huge trade deficits with China and other developing countries. Its a direct result of Reaganomics. ie wall streets malevolent influence over Washington. Free trade has pitted American factory workers against $1 a day worker in developing economies. They simply could not compete on cost. Wall street profited while American manufacturing went to the wall.
Stave Rattner, most often seen on MSNBC’s Morning Joe as its financial statistician and chart explainer, seems to enjoy having his findings find new life elsewhere, because of his sixty-six-year-old youthful hair dyed appearance, must know by now, above all people one cannot smudge real numbers…
just look at every crisis prior......each one bigger than the last. interest rate cycles are bound to become more violent and out of control until the system cracks. longer deeper bigger crisis are ahead!!
Federal government spending is out of control. No political will to tackle the problems. Everyone just want to get re-elected. Low interest rate environment has inspired much of corporate debt.
Not only do they NOT want to tackle the problems, they want to blame the OTHER side for nothing happening.
Puzzled why they want to get re elected if they're not solving problems. These are well educated people who can make good money in the private sector.
John Burris They are just interested in the power and prestige of public office. John McCain could have done very well in the private sector. He spent 21 million of his own money to remain in office.....
Must be the prestige. Very little power if you don't solve problems with it, have to answer to campaign contributors, etc.
John Burris Seriously believe that? Many politicians remain in politics for years not doing anything. They pander year after year to their base and blame opposite party for their lackluster performance.....
Good insight
How come no one points out that the majority of the federal budget is due to military spending? Cut the foreign military adventures and put the money into rebuilding the US economy. No crash needed.
dude, the military is one of the biggest economic factors in the us, war is what drives half of your economy, that's why you have that many ;)
Why aren't corporations buying down debt instead of doing stock buybacks?
Because the stocks will crash if the companies don't buy the stocks. The American stock market is hugely over sold and the stocks are worthless.
I think it's far more likely they own stocks and stock options and thus want to keep them high.
John Burris ......look at Amason stocks....... 160 times cash flow is sooo over valued. And barely profitable....... the owner makes his money on selling stocks. The American stock market is hugely over sold.
Unfortunately companies are normally under pressure to please shareholders in the short term (quarter to quarter). This causes CEOs to focus note so on short-term stock performance over longevity. A good portion of upper managments compensation is directly linked to stick performance for the year as well
Yes, yet another thing that needs to change in the USA.
How is there high corporate debts at the same time corporate profits are high?
The larger the corporation the lower the return on investment (normally) due to the law of large numbers.
So if a company wants to increase revenue by say 10% they will turn tho taking on massive amounts of debt to fund their short term growth and hope they can pay it off over the next 10 years with the increased cash flow while pleasing shareholders be having revenues go up in the short term.
Corps use hundreds of billions of debt each year to buyback shares to lower share count which increases earnings per share. So you can get higher earnings on softer top line growth.
Debt is a Balance Sheet item and isn't a measure of profitability. The interest paid on servicing debt has an effect on profitability and if the interest rate is low then it has less effect on profit.
Yeah, the problem is that all the money generated and loaned went into buying acquisitions and equity, rather than generating value. Now things are slowing (business cycle) and it is time to pay the piper. If there is a bailout we absolutely need to require that these loans go into actual new growth versus consolidation. It has been the ultimate mismanagement of the economy by the republicans and trump to run such deficits when we are doing well, and cutting taxes now, before we need stimulus. Terrible.
A healthy economy has intentionally been sabotaged. The quantitative easing encouraged more debt and inflation. Interest rates rise to counter that but they cant now because it would cause an economic collapse. The only solution is drastic spending cuts.
just look at the ballooning us deficits projected to reach 1trillion a year in 2020
At least Mad Magazine still makes me laugh!
Let the GOP give more tax cut to the rich, that will help everyone. Think?
Doesn't work drives buisness to nations with better laws.
Get a Gun and ammo, stock up on food! This is coming soon!
Learn how to grow food and teach others. That'll make you more friends than any guns ever will.
gonna complete his setence..
"this is, tjis is..." a complete disaster.
I got have the correct the Gentleman. It's a first world countries deficit (and a big one at that) behaving like a third world country.
I'd say HQE∞ Hyper Quantitative Ease ad infinitum let's show Venezuela how a hyperinflation looks like. FNC and FBC will dig.
You are right there! QE4 and US$ crisis is inevitable....
America manufacturing base was offshored in the 80s to enrich wall street at the expense of American blue collar workers. Goods that were once made in American factories are now imported and paid for with borrowed and printed money. This is the sole reason America today runs huge trade deficits with China and other developing countries. Its a direct result of Reaganomics. ie wall streets malevolent influence over Washington. Free trade has pitted American factory workers against $1 a day worker in developing economies. They simply could not compete on cost. Wall street profited while American manufacturing went to the wall.
Could cryptocurrency be the best solution to this?
Nope
No, its fake also.
Stave Rattner, most often seen on MSNBC’s Morning Joe as its
financial statistician and chart explainer, seems to enjoy having his findings
find new life elsewhere, because of his sixty-six-year-old youthful hair dyed
appearance, must know by now, above all people one cannot smudge real numbers…
Oh, if I only had a dollar for every time a financial show talking head asked their guest to tell them exactly when the next sky was going to fall!
just look at every crisis prior......each one bigger than the last. interest rate cycles are bound to become more violent and out of control until the system cracks. longer deeper bigger crisis are ahead!!