I am feeling more optimistic today. The good news is that Obama's out-of-control spending is scaring even Democrats. And the National Debt Clock has been slowing down recently. On 4/30/2010, the debt was at $12.949T, and since then "only" $89B has been added to it. Its too early to celebrate yet, since there are typically huge adjustments made at the end of a month, but the rate of change looks very good. I want to revisit this after the 4th of July weekend.
Since the national debt is still increasing, why is this good news? Well, the global economy can absorb, and may even expect a certain increase in the US debt. We are not only the lender of last resort, we are also the spender of last resort. The problem is not deficit spending, it is out-of-control deficit spending. And for the moment the spending seems to be in control. Any month in which the deficit increases less than $100B is good news. According to the CBO numbers, the deficit from here on out will be about $50B/mo. I don't quite believe that but I am willing to meet them half-way.
So expect an article about July 6 saying something like "2022 Financial Collapse postponed". I don't think that we are totally out of the woods yet and I don't think our financial system is perpetually sustainable. But I am tentatively calling off my 2022 projection.
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