21 votes

Interest Paid On US Debt Last Month Alone=$103,886,876,062 (70 Billion More Than May)

http://www.treasurydirect.gov/govt/reports/ir/ir_expense.htm

Interest Expense Fiscal Year 2012

(Fiscal Year Total)
$375,867,511,477.84

June
$103,886,876,062.52

May
$30,506,664,352.19

April
$30,121,029,367.43

March
$24,682,649,179.83

February
$17,414,482,614.98

January
$21,122,865,703.96

December
$98,652,091,319.29

November
$21,709,460,451.61

October
$27,771,392,426.03



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Can we Jettison the Debt?

If you have a minute, please visit: http://www.dailypaul.com/244168/july-4th-2013-liberty-day-ch...

There are some who are tring to figure out how!

We are being robbed

We are being forced to pay for the debt and stupid decisions of generations before us... Meanwhile... They're all retiring now and cashing out their retirement savings.

Yah, I am wondering if it

Yah, I am wondering if it might be worth taking the 30% penalty/tax hit before the elections...who knows what will happen if Ron Paul isn't president.

If your talking about your 401k or an IRA

GET THAT $HIT OUT NOW! However, I bet they won't let you take it out even if you accept the penalties. I think they changed the laws without telling anyone and its now takes an act of congress to get at your money. I took mine out about a month before the crash in 2008. (it was just by chance...I didn't know anything about the looming crash) But even back then, I had to write a hardship letter, prove that I lost my job, and do all kinds of other BS.

I think 50% is where the cut off is right now. If you can get your money out and only lose 50% you will be better off than if you leave it invested in money market funds. However, you should immediately buy 70% silver and 30% gold with what you get out. Minus what you need to have a good night or two on the town. :)

We are hoping to buy some

We are hoping to buy some land without debt. Did you have to take any penalties since you filed for hardship? What is your recommendation for where to buy gold and silver?

Bear..

Still had to pay 20% penalty when I took out my 401k money.

There are probably others that can chim in about where to by gold. I'm so poor I've been selling the gold I had just to keep a roof over my head and to eat.

I trust Peter Schiff. He can get you physical gold and silver quickly. His website is http://www.europac.net/ If you drop President Pauls name and/or mention schiff radio or stefan molyneux you might even get an additional discount.

But, like I said...I'm probably not the best person here on the DP to answer that question. Maybe someone else has additional sources.

Thank you for the Schiff

Thank you for the Schiff link. Wishing the best for you and yours.

Don't forget the kickbacks

The neocons are living on kickbacks, they're laughing all the way to the bank. Oh by the way they're laughing at us!

"We can't solve problems by using the same kind of thinking we used when we created them."
Albert Einstein

Republicae's picture

I can assure you that they

I can assure you that they will not be laughing long for they will be subject to the same results of a systemic collapse as everyone else, but they will probably find it much harder to survive when they are being tracked down through the country-side, passing their colleagues heads along the way stuck on poles.

http://militantjeffersonian.com

"We are not a nation, but a union, a confederacy of equal and sovereign States" John C. Calhoun

IMO we won't make it

that clock will run out before we can attain critical mass to free the country.

that shouldn't stop us from pushing forward though, we will need a good percentage of people who understand how we got into this mess and not repeat the same mistakes as we pick up the pieces and rebuild.

the interest is only one component to the massive...i mean MASSIVE, amounts of debt sloshing around the system.

Republicae's picture

There is a corollary issue

There is a corollary issue with the debt burdens of not only the U.S., but also all of the industrialized countries, including China and it is the interconnectivity of the entire global economy. There are so many relationships that all it will take is the collapse of one of the major systems and the whole global system will suffer collapse. The monetary system, which, by the way, is in the stages of collapse, is the primary support of the global economy and it links every single exchange and relay of goods and services together. Unfortunately, there is absolutely no asset value behind the entire monetary system of the global economy. The entire system works because there is a faith in the system, but with such a complex system the level of confidence can be easily shaken.

For years I have talked about the growing impotency of the fiat monetary system in economic terms, meaning that as more and more fiat money is placed into operation, the inflationary depreciation of the currency begins to degrade the actual effectiveness of each economic exchange. Additionally, because there is an essential balance between the economic efficiency of each monetary unit and the ability to maintain actual economic productivity through such exchanges there will come a time when the utility income that is relative to the fixed costs of production fails. Since the entire system has become so distorted through the manipulation of the monetary system and the economic system it supports, there are few reliable mechanisms within the economy that allows businesses and people to determine what decisions are best suited for any given time. The entire system can be subjected to collapse if just one major component fails.

The Panic of 2008 was merely the beginning of the overall global systemic collapse, but the problems that brought about the Panic of 2008 were in the works since at least the 1970s with the foundation of those problems stemming from earlier government monetary decisions such those found in the 1930s and, of course, the creation in 1913 of the Federal Reserve system. Of course, the weakest link is always the problem, but in a system of such massive integration as with the global economy there are multiple weak links that can easily domino.

The entire complex system of not only physical infrastructure, but also economic infrastructure is so integrated that it would not take much for the entire system to be subjected to complete collapse within a matter of days or a couple of weeks at most. There will be a cascading effect of failure in the system as one by one, the infrastructures collapse.

We might not realize it but we have already entered into the stages of collapse, what has been happening however is that the governments of the world, through the use of fiat currency, have been patching up the system in order to maintain it in hopes of finding a solution, but there is no solution in their current point of reference. The entire contraction of the economic system and the ability of governments and their central banks to maintain the most critical structures through massive subsidies are becoming more and more difficult. There will reach a point where no matter how much fiat money (physical and digital) they throw at the problem there will be a decreasing effectiveness in the potency of their monetary magic tricks.

Of course, central bankers all fear deflation, but their assumptions are based on a 1930s understanding of deflation in a world that has not operated in those terms for at least 40 years. Their responses therefore, will be based on that 1930s understanding and thus, the outcome will not be as they expect. Unlike the 1930s, today bank-issued credit is the source of just about every type of money circulating. The system has evolved into one where it requires more credit expansion just to service previous credit burdens. The problem is that in order for this system to continue to function at any meaningful level of effectiveness the GDP must also increase at a level of credit expansion, but the problem, as mentioned before, is that with a fiat monetary system the economic potency is increasingly depleted through such monetary credit expansions. It is a snake eating its own tail and soon the snake will have nothing else to consume but its head.

Of course, the central bankers of the world and the governments that sponsor them are desperately attempting to maintain the system without realizing that it cannot be maintained through the very means that brought about the dislocation in the first place.

Additionally, the Federal Reserve released a paper the other day stating that because of their efforts over the last decade the stock market increased by 50%, but what they fail to say is that it is a completely manipulated system that defies the entire economic structure of reality and that it cannot be maintained. Thus, if 50% of the stock market is based on the artificial manipulation by the actions of monetary policy by the FED then the actual GDP was not actually real, but a mirage that was produced to effect a socio-political outcome. I dare say that we have not seen actual economic and productive growth in this country for well over a decade and the manipulation has been carried out to conceal the actual decline in the overall economic reality in order to maintain a degree of social and political order.

Of course, the trust has been broken long ago between this government and the People, what remains are a few slithers of trust but that is rapidly being tested, not only in this country but also globally. We are all getting poorer by the minute.

Since the entire global economy is based on a type of proxy-wealth involving fiat currency that is a very weak link in the whole global economy. Unlike gold and silver, fiat wealth is nothing more than a proxy for real assets holding no value in and of itself. Take, for instance, many people hold financial assets as an investment, particularly in their retirement funds however, if you consider the actual make-up of such investments they are all based on the fiat proxy-wealth system, which, is largely dependent on trust. Such proxy-wealth investments are nothing more than a re-allocation of values within the market and in order for a person holding such investments to actually profit from them is if those proxy-wealth investments can be readily transformed into real asset-wealth at some point in the future. It is that conversion that is the ultimate source of value for such investments, if there is a failure in any portion of the system then the entire structure collapses and loss ensues on a massive scale. Now, if we consider the fact that the FED has already stated that the last decade of such proxy-wealth investments were subjected to its manipulation to increase their nominal value by 50%, then the real value of conversion without such manipulation would be a 50% loss of conversion value. That should inject a huge question of trust into such security instruments.

The system can and will suffer from a systemic collapse; one weak link can facilitate such a collapse. What will occur, it appears, is that as there will be a debt-deflationary collapse causing a cascading effect within the economy there will also be a corollary hyper-inflationary event created as the governments and central bankers of the world pump massive amounts of fiat currency into the system in an attempt to stave off the debt deflation. Thus, we will experience a growing decline in economic activity, which, at the same time, experience the most drastic inflationary price increases in a rapidly decreasing selection of goods and services. In other words, it will be nothing like the 1930s.

Debt serviceability becomes increasingly difficult and no longer functions as an adequate means of economic exchange, thus the entire contraction of the global economy becomes incompatible with the entire financial system that is based on the credit, which back it. What we have had for decades is nothing less than a hype-credit expansion but eventually the global GDP cannot grow fast enough to service the debt that is created to maintain the system. Again, the snake is eating itself from the tail up to the head, eventually the snake has eaten all of itself and there is nothing left to consume.

Eventually, there will be a complete loss of faith in both the government and its façade of finance; as such, people will begin to exit the system or at least they will attempt to exit it but will be restrained both by government edict and by the fact that there will be a decreasing ability to convert proxy-wealth into real assets as the proxy-wealth is perceived as increasingly worthless. While there will be a period that people will stubbornly cling to their fiat cash, a stage will be reached where fears begin to press them to rid themselves of fiat cash as soon as possible, trying to convert it into any type of hard assets available.

People will awaken to a reality that the entire system has been little more than an extremely complex government/bank sponsored Ponzi Scheme, that all the global financial markets and the ability to convert that proxy-wealth into actual assets is based on an illusion that has been carefully crafted and maintained for decades.

Now, most of what was just written is based on what could be considered a relatively slow collapse, but it is important to understand that such a scenario could rapidly be transformed into an extremely fast collapse with just a few minor changes. It would not take much for a financial collapse to rapidly turn into a complete social collapse within a matter of days of an event. Not only is there an integration of financial infrastructure, but also the physical infrastructure within the economy. There could easily be a massive disruption in the entire supply chain of the global economy due to the fact that it is based on Letters of Credit which, are becoming difficult to obtain as the economic situation worsens around the globe. We would see food and fuel shortages within a day, not only that, but almost instantly there would be hundreds of thousands of people put out of work by such a disruption.

Within a few days the food, fuel and water shortages would escalate, banks would be forced to shut down because of bank runs and no cash. Within a week all travel would come to a compete stop; all functions within the government would essentially cease within a few weeks. In a month we would essentially be placed back into the 1800s.

So, given the real possibility of such a scenario, the best thing to do is prepare.

http://militantjeffersonian.com

"We are not a nation, but a union, a confederacy of equal and sovereign States" John C. Calhoun

The Republicans and Democrats want to continue the insanity

The republicans want more wars and borrowing. The democrats want more social programs and borrowing. Libertarians want no borrowing and freedom. I wonder who I will vote for?

IMO...Once we're cut off from foreign lenders

we'll "cut back" a little plus create more new money. This will cause higher inflation and will likely make it easier to pay China & Japan. Congress will default to foreign lenders by:
A. Refusing to make any payments to them.
(declare them enemies or simply default)
B. Only make interest payments.
C. Declaring existing loans "interest free".
Once the propaganda against China & Japan is in force,
Americans will buy domestic products again...
...and "RP was right" will be a VERY popular saying!

Doomed...

...without Paul's trillion dollar cut!

Doomed

Without the help of Almighty God!

" In Thee O Lord do I put my trust " ~ Psalm 31:1~

Obviously!

There are things written that we have all known for so long. Nothing should really be surprising. We do know that in the end we will win, but we also have known that what is going on was predicted in the good book way before we were all born! However, we are supposed to be the salt, so giving up isn't an option.

Before casually tossing in "The Good Book"

Take some time to do 2 things. STUDY the ORIGINS of Government..not just US Government...all Governments. AND STUDY the ORIGINS of Religion. They are interconnected to a degree that it is not possible for a free thinking, logical human being with 1/2 a brain to no see what the real purpose of "The Good Book" really was/is.

I know it's tough to accept...I attended church for over 25 years as an adult. There are 2 primary reasons most people still hang on to organized religion. It is so uncomfortable when you start figuring out the truth that people just stop. They refuse to continue reserarching to confirm what logic and reason is telling them...they just can't handle it. And, "The Good Book" very cleverly included many passages that indicate if anyone ever says anything about God or the bible not being true...then it's "The Devil" trying to "get you".

I'm not the devil. I have read the bible and I have done mountians of research. I have 2 close friends who are pastors. Many pastors and members of the clergy know the truth...but in their case...they have too much invested in both time and money to be willing to accept the truth...as least publicly.

Let the down votes begin! LOL.

Religion in and of itself isn't good...

...and I already know that. You are correct about religion. That isn't what I was speaking of. I am not "religious". There are also many different interpretations of the "good book" as well. Also, it doesn't take a rocket scientist to figure out that the "good book" was written ages ago and has predicted things that are presently going on now. You can put it together like a puzzle. It's not hard. Also, I agree that many churches are not real and they can be filled with people that have selfish motivations. "The Devil gave me a flat tire" and "there's demons in the doorknobs", yeah, I'm familiar with all that stuff too. The rhetoric can also be there without the actual fruits in a persons life(personally that's why I like Paul, because he has lived it...unselfishly).

I have been in churches even longer than you have! I have seen it all. The good, the bad, and the ugly. It all boils down to one thing. Your own personal beliefs and what you choose is truth. One cannot prove to another their own personal witness to truth just as one cannot say that anothers witness is not real. It is personal. You wouldn't know that unless it happened to you.

However, if your a Paul supporter and a lover of liberty, we are actually on the same side! So I'm not going to down vote you just because you have a belief different than mine in that area! I love ya regardless!=) P.S. I enjoy your posts...very good.

I agree 100%. Love is being sent right back at ya!

I'll say this, I'd LOVE for God to pop into my room right this second and prove me wrong! Who wouldn't love to be proven wrong about that?

And for the record I honestly don't care what people choose to beleive. I completely understand. I was there.

President Paul has changed my life. I am far less critical of others regarding just about anything than I was prior to learning about the NAP, Freedom, and Liberty.

So, on we go...together, to Tampa, For Liberty!

IF the Debt-Clock stays On.

+1, you are right, one should live within means /income, and avoid debt.
People borrow because of need, greed, or ignorance of consequence (usury), but only the weak & the fools pay interest.

the Debt-Clock leads to Doom.

Republicae's picture

Natural or market interest is

Natural or market interest is a vital part of healthy markets however, the current manipulated interest structure is corrosive, but it is absolutely necessary to make a distinction between the two!

http://militantjeffersonian.com

"We are not a nation, but a union, a confederacy of equal and sovereign States" John C. Calhoun

Natural Rate of Interest Is Zero-000%

What I find very surprising is that - "Interest is regarded as a Given". It is considered sacrosanct in some circles. We live today in a world of doubt, skepticism, critique, questions & debates, yet "Interest" is unquestionable, it'$ demand-$ have to be satisfied.

It is incorrect and unsuitable to say "natural rate of interest", No such thing ever existed before, nor will it exist in the future. As for the "market rate of interest" - this can only be observed in auction of bonds, in this instance the credit-worthiness of the issuer (govt) is considered by the buyer /investor. You do recognize that it is manipulated currently.
It is 'natural' for bankers to form a cartel (cabal, club) and dictate interest rates by creating (false) shortage of liquidity, thru (statutory) minimum reserve requirement dictated by the central bank.
Many theories of interest are propounded by the economists who are in the pay of banksters. Pls read two better ones -

"Natural Rate of Interest Is Zero", 2004.
http://www.cfeps.org/pubs/wp-pdf/WP37-MoslerForstater.pdf

Natural Rate of Interest Is Zero,
JOURNAL OF ECONOMIC ISSUES Vol. XXXIX No. 2 June 2005
http://moslereconomics.com/wp-content/graphs/2009/07/natural...
This paper argues that the natural, nominal, risk free rate of interest is zero under relevant contemporary institutional arrangements.

Republicae's picture

No, interest is not regarded

No, interest is not regarded as a given unless it is manipulated, the fact is that interest is a part of economic market phenomenon, it didn’t just happen when someone decided to charge interest, it is a signal of time preferences that cannot be substituted by either manipulation or by an edict to band such interest. Without market interest the whole economy eventually becomes distorted in much the same way it does when the interest rate is manipulated.

What is interest? Well what it is not is an artificial number that is decided upon by a group of bankers and manipulated to create a socio-political outcome that would not be possible under normal market conditions. Now, perhaps I shouldn’t have used the word “natural” but it is appropriate in regards to what happens within an unencumbered economy, in other words within an actual free market. What the “natural” rate of interest represents or reflects is the underlying factors of market movements within the economy. It is the “collective” signal of untold billions of permutations within the decisions of billions of people who form the market itself.

In a free market, without government or central banking influence, it governs the allocation of resources between what is consumed today and what is invested for future usage, without it there could be no proper allocation and distortions would result. It provides the difference between the unconsumed present output of productivity and is always, under a free market, consistent with the consumers willingness to postpone consumption into the future.

So, no matter what you call it, whether you call it the “natural” rate of interest or something else, it is a market phenomenon that is ever present, not because someone is setting a rate of interest, but because of the myriad of economic factors involved with the decisions of billions of people within the market itself. So, what does the “natural” rate of interest represent? Certainly not usury, but an essential part of the economic market process, without it there would be no free market as we understand it, nor would there be any real prosperity because there would be no method of determining either economic calculation or for that matter the allocation of resources within the market to produce goods for consumption.

Additionally, if you were a person who needed capital to start a business and I had necessary funding to provide you with such capital, why would I use my funds to finance you if I am taking my available funds out of my control and putting those funds in your control? Why would I risk such a venture if I am to receive nothing but my principle in return, at least if you are successful in your business venture, but you might not be successful, you might fail. That is a risk I would be willing to take is my funds were actually working for me as I lend to you at a rate of interest that compared to the risk I was taking in lending it to you.

The reality of the “natural” rate of interest can be considered little more than the pattern of consumption over time by the participates within the market place. It is vital for the market, not only localized, but generalized markets to be provided with such signals, without them, as I said there ultimately will be a break-down in the allocation of resources and the entire pricing structure of the market will become distorted, sending off signals that do not provide the participates within the economy adequate decision making understanding.

It appears that we are talking about two entirely different things, are we not, for you state that there is no natural rate of interest and yet you have failed to describe what the natural rate of interest really is in your comments. Instead you have connected the term “natural” rate of interest with the current manipulated monetary system and markets, it is not that. The “natural” rate of interest has nothing to do with what is taking place within the manipulated command markets today, that is totally an artificial construct created to provide the lifting of wealth from one sector of the economy into another sector.

Again, as I read your comments, you are talking about something that has nothing whatsoever to do with the “natural’ rate of interest which, as I have explained, is a market phenomenon, not something that is readily manipulated by either central bankers or banks.

Strangely, the paper you link to refers to the very person that “coined” the term “natural rate of interest”, that was Kurt Wicksell. Additionally, the paper you link to states some very interesting things, things that you have apparently overlooked what is actually being said.

Here is actually the crux of the matter and I will refer to the very line you used to argue the case that there is indeed a “natural rate of interest”, please read this line again carefully:

And while many economists reject the very notion of “natural” itself, this paper argues that in general there are significant instances in which natural magnitudes do apply to the economic system, and, specifically, that the natural, nominal, risk free rate of interest is
zero under relevant contemporary institutional arrangements.

Now, what did it actually say? Well, it doesn’t say that the natural rate of interest is zero, it states that under relevant contemporary institutional arrangements it is zero, and I agree with that because under contemporary institutional arrangements there is no way for the market to present a “natural rate of interest” because the entire institutionalized economic system is so distorted through institutional manipulation. So, under current conditions the natural rate of interest is indeed zero, but under free market conditions the market would determine the natural rate of interest as market movements occur.

The paper goes on to state the following:

In a state money system with flexible exchange rates running a budget deficit—in other words, under the ‘normal’ conditions or operations of the specified institutional context—without government intervention either to pay interest on reserves to offer securities to drain excess reserves to actively support a non- zero, positive interest rate, the natural or normal rate of interest of such a system is zero.

Now, it is obvious that the authors are nothing more than Chartalists which, is a glorified form of Greenbacker, they tend to be highly Statist in their preferences of government controlled and managed monetary systems and oppose both free markets and free market money as Dr. Paul promotes.

http://militantjeffersonian.com

"We are not a nation, but a union, a confederacy of equal and sovereign States" John C. Calhoun

* * * * * re the sub:eject of usury.

thank you for your careful study - and clarifying the fine points related to interest. I/we gained much from your labor.
The 'free'market canNot beat secret societies /cabal. Now we hear about the manipulation of L.I.B.O.R., this mischief was played by an association of private banks, with little or no supervision by the regulators or the Bank of England. It had been going on for a long time, only now it has come under the light.
usury is a nasty topic, it$ very tiring (]:)>

I am just guessing

But maybe the servicing of debt is particularly expensive on the 6 and 12 month of the year because of the bond system? I noticed last December was 98 trillion which is still 68 trillion more than last month.

This is the problem with public debt. We have to pay this every month with taxes and this is exactly why Keynesian economics fails. When this number gets bigger and bigger the private sector has less money to spend therefor there will be no economic recovery until this number gets smaller. That is why government must cut spending for there to be an economic recovery.

Spending will not be cut imo

From History it seems things continue as is till the wave breaks.

People who seek government subsidies and employment and services and favors, etc., are for the most part are desperate people.

Things can be normally sustained for at least another 5 years or so imo.

I do see government spending at all levels steadily increasing until then.

donvino

What I find so funny

is that the vast majority of Americans think that when SHTF happens, it's going to be the poor and the people on welfare that will suffer most. I disagree. Most poor people and people on welfare have other income and devoloped a system of barter and other ways of keeping themselves fed and with a roof over their heads.

The corportate welfare and the MIC and compaines that count on millions each week for THEIR income will be knocked into reality very fast. Poor people have adjusted to living very meager lives and there days will not change drastically when their puney check from the State is cut in half or not sent at all.

On the other hand, the rich NEED to pay for lots of $hit they have leveraged...and those bills will not stop coming due when uncle sam has no more subsidies for them.

Good Point

As well, I do think soccer moms will have a very difficult time adapting lol

donvino

Monies

Most likely those monies will be utilized to buy more bonds imo.

donvino