I'm no economist but I thought I should look into how big a problem is the credit crisis. I have done a few basic sums.
TOTALS FOR THE US IN $BILLIONS
Income
(Total value of all US taxes)
2600
This represents 18.8% of GDP since 1930 the highest tax rate has been 20.9 in 2000
Costs
(Bail out) 850
(Loans Liability) 2000
(Current US Debt) 10600
(War) 144
TOTAL 13,594 (Thats $48k per person)
US GDP 2007 13,810
So if the US government spends nothing on running the country and everything on paying off the debt they will take about 5 1/2 years to pay off this debt.
This puts the the US at about 1:1 debt to GDP which brings them from the 27th most in debt in 2007 to the 6th in the world now.
Below is a graph of debt to GDP before all this bail out stuff (taken from zfacts )
I've got a few movies here to looking at debt
Below is a movie by the that disputes the official government figures http://www.meetup.com/nyinvestingmeetup/
(anyone got opinion on this lot - a bit of research seemed to support thier claim that the figures are being modified optimistically.)
This sounds very scary to me.
Could anyone who knows a bit about this give me some explanation behind numbers that will give me some feeling that the US is OK?
Could we have currency devaluation and rampant inflation? An article here (Argentina Vs US) explains the similarities.
DEFINITIONS
US debt = All the current debt owed by the US government not to be confused with US deficit which is the yearly shortfall between taxed raised and money spent by the US government each year.
SOURCES
Total Tax raised in the US
US War expenditure
Total US Government Debt
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