Debt Relief & Management

Posts Tagged ‘grassroots’

21 Century Great Depression causes and what to do.

Causes:
The snowball spiral caused by debt started the decline in the American economy.

Concerns in the US include national and external debt, entitlement liabilities for retiring baby boomers who have already begun withdrawing from their Social Security accounts, corporate debt, mortgage debt, a low savings rate, falling house prices, a falling currency, and a large current account deficit. As of June 2008, the gross US external debt was over $13 trillion, the most external debt of all countries in the world. The 2007 estimate of the United States public debt was 65% of GDP. As of September 2008, the total US federal debt was approximately $9.7 trillion, about $31,700 per capita. Including unfunded Medicaid, Social Security, Medicare, and similar promised obligations, the government liabilities rises to a total of $59.1 trillion, or $516,348 per household.

The primary economic concerns have centred on: high national debt ($9 trillion), high corporate debt ($9 trillion), high mortgage debt (over $10 trillion as of 2005 year-end), high unfunded Medicare liability ($30 trillion), high unfunded Social Security liability ($12 trillion), high external debt (amount owed to foreign lenders), high trade deficits, and a serious deterioration in the United States net international investment position (NIIP) (-24% of GDP). In 2006, the US economy had its lowest saving rate since 1933. These issues have raised concerns among economists and national politicians.

What to do

In 1933, when the danger of recession appeared most serious, government sought to strengthen the economy by spending heavily itself or cutting taxes so that consumers would spend more, and by fostering rapid growth in the money supply, which also encouraged more spending. In the 1970s, economic woes brought on by the costs of the Vietnam conflict, major price increases, particularly for energy, created a strong fear of inflation. As a result, government leaders came to concentrate more on controlling inflation than on combating recession by limiting spending, resisting tax cuts, and reining in growth in the money supply.

The US also has one of the most highly regulated banking environments in the world; HOWEVER, MANY OF THE REGULATIONS ARE NOT SAFETY AND SOUNDNESS RELATED, but are instead focused on privacy, disclosure, fraud prevention, anti-money laundering, anti-terrorism, anti-usury lending, and promoting lending to lower-income segments.

Of major concern is the fact that the magnitude of the NIIP (or net external debt)is a bit large. Fueled by the sizable trade deficit, the external debt is so large that many wonder if the trade situation can be sustained in the long term. Complicating the matter is that many of America’s trading partners, such as China, depend for much of their entire economy on exports, and especially exports to America. Many controversies exist about the current trade and external debt situation, and it is arguable whether anyone understands how these dynamics will play out in an historically unprecedented floating exchange rate system. While various aspects of the US economic profile have precedents in the situations of other countries (notably government debt as a percentage of GDP), the sheer size of the US, and the integral role of the US economy in the overall global economic environment, create considerable uncertainty about the future.

This enormous inflow of capital from China is one of the root causes of the financial crisis engulfing the US as of September 2008: China has been buying huge quantities of dollar ets in order to keep its currency undervalued and its export economy humming, which has caused US interest rates and saving rates to stay artificially low for too long. These low interests, in turn, created the housing bubble (when interests are low, people can afford more expensive houses while keeping their monthly mortgage payments the same), whose collapse has caused the recent turmoil in the financial markets worldwide. Leading economists such as Larry Summers (former Treasury Secretary under Clinton) and Paul Krugman had been warning about this pernicious cycle since the mid-2000s.

An Up dated version of the New Deal programmes of Franklin D. Roosevelt, is URGENTLY NEEDED.

Duration : 0:4:20

Read the rest of this entry »

Learn Now or Pay Later is a weekly personal finance series produced by Cambridge Credit Counseling Corp. The goal of this educational series is to better prepare the public to deal with matters pertaining to credit, debt and money management. This week’s webisode is the second in a three-part edition featuring Christopher Viale, President and CEO, discussing how debt management plans work and the benefits of using such an option.

Duration : 0:1:52

Read the rest of this entry »

Citizens from Kansas speak out about the future of health care.

Duration : 0:8:58

Read the rest of this entry »

After 17 months of directing Operation Hillary, the would-be commander-in-chief is confronting some serious debt. $22.5 million of it. According to a report by the Federal Election Commission (FEC) released Friday, Clinton owes $10.3 million to everyone from printers in Iowa to caterers in Pennsylvania to Mark Penn’s consulting firm in D.C. She’s also down the $12.2 million she personally loaned her campaign.

http://blogs.tnr.com/tnr/blogs/the_plank/archive/2008/06/25/choose-your-own-debtventure.aspx

Faced with a campaign debt of over $20 million, Hillary Clinton discussed the issue with her former rival Barack Obama ahead of their first campaign appearance together to project Democratic party unity. The two spoke by phone Sunday night, the first time the likely Democratic nominee and his former rival have exchanged words since their private meeting in Washington weeks ago before Clinton conceded defeat and endorsed Obama. They discussed retiring Clinton’s campaign debt, a conversation Democratic sources cited by ABC called “constructive”.

They also discussed their forthcoming joint fundraising appearance in Washington on Thursday and the first campaign appearance together appropriately in the small town of Unity, New Hampshire, Friday. Though the former first lady won the New Hampshire Democratic primary, the two received 107 votes each in Unity. More on the US campaign trail

Clinton conceded the Democratic race to Obama June 7, just four days after splitting the final two primary contests in South Dakota and Montana.

The pair held a secret meeting in Washington at the home of Senator Dianne Feinstein, a Clinton supporter, prior to Clinton’s concession but had not spoken since that time. Battle for the White House

Besides talking to Obama, Clinton Monday turned to her supporters for help in settling the well over $20 million in debt, nearly half of which she loaned herself personally earlier in the year when her campaign was virtually broke and faced life-or-death primary contests.

Under campaign finance laws spearheaded by current presumptive Republican nominee John McCain, Clinton must pay herself back before the party’s convention in late August, or else she is only allowed to receive $250,000.

In an e-mail to supporters, Clinton says she “has something I want to say,” and directs readers to a Web video in which she says “Today, I still need your help.”

The video reads: “By helping us pay off our campaign debt, you’re not just helping Hillary elect a Democratic president and grow our majority in Congress. You’re making it possible for her to work as hard as she can on the issues we care about.”

Clinton also continued to praise onetime rival Barack Obama, saying she knows the Illinois senator shares the same goals as she.

The Obama campaign is reportedly open to helping Clinton raise money to pay off her lingering campaign debt, though no agreement has been announced yet. Under campaign finance laws, the Obama campaign is not allowed to retire Clinton’s debt directly
http://sify.com/news/fullstory.php?id=14701275

Duration : 0:10:19

Read the rest of this entry »