I didn’t say cash flow I said cash accounting vs accrual accounting.
The cash method and the accrual method (sometimes called cash basis and accrual basis) are the two principal methods of keeping track of a business's income and expenses. In a nutshell, these methods differ only in the timing of when transactions, including sales and purchases, are credited or debited to your accounts.
You must adopt one method and one method only. But the USG with their infinite wisdom and power think they can use both.
But to be clear we don’t have a cash flow problem as far as closing the budget deficit each year. Because like you said we borrow it. The crux of our problem is spending vs revenue. When we solve that problem we stop creating yearly budget deficits therefore reducing the need to meet our cash flow problem by borrowing which obviously reduced the debt.
SS, The liabilities are accruing but the revenue is being siphoned off to support a different portion of the venture( they are stealing our retirement funds) and not invested to take care of the growing liabilities. Oh they say they are investing in government bonds, but these are inter-government bonds and not marketable. So the only source of funding them is to return them to the government. Well when the revenue goes cash flow negative (when all revenue is expended on benefits, the siphoned will reverse and revenue will be drawn from income taxes to fund the shortfall). The best answer I have seen is to privatize SS. Here is a link that might help.
BTW Netscape was bought by AOL in 1998. Banks net profit margins are between 11%- 20%.
Grain of salt….not a vetted source, but they quoting yahoo finance.
I want to skip to your final point so all I will say about your rebuttal on the Fed is, The profits go back to the US Treasury except for the 6% dividend.
I agree with you final point somewhat…. I am a capitalist but the problem is in corporate governance not that they are evil corporates. The stock market has been turned into a casino. With the advent of the mutual fund the board of directors has become nothing more than honorary positions and means nothing. Back in the day the board consisted of the people that owned the most shares in the company and they took their duties very seriously because it was mostly their money. When the mutual funds became the largest shares holders there was a power shift from the board to the CEO. Investing use to be about dividends now it the greater fool…..I can buy it today if I find a greater fool to buy it tomorrow. I am not defending this position because of my station in life. I used to be a broker and left because of what the USG was doing to the dollar. I walked out on a 6 figure salary plus bounces because I would never be able to live with myself knowing I was recommending investment in assets based in dollars…..I trade for myself, but only options. I would prefer if the market would return to the old days, I would be able to truly take advantage of my god given talent of research and provide a valuable service to my community…..but I refuse to be a charlatan, But with that said and please do not take offense to this but your comments are laced with the language of the conspiracy theorist dialog.
"Before we can ever ask how things might go wrong; we must first explain how they could ever go right"
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