A small excerpt from a recent piece (Read Here) on the latest US Flow of Funds report:
‘During the Bear Market, households have increased debt by $9.38 for every extra $1 of wage or proprietorial income earned – a degree of distress leverage 3.3 times worse than anything previously employed.
‘It has also meant that the sum of all private debt – financial and non-financial – for each member of the private non-farm workforce has risen 32% in three years to close to $250,000, while adding in the on-balance sheet government total pushes the burden close to $300,000 per worker...’
Meanwhile, the Big Kahuna inside the Beltway - as well as all the Little Kahunas in the States and Muncipalities - are in overdive, too...
‘The total amount of government debt - whether federal, state, or local - in public hands has risen by its fastest ever increment this past year, with Washington’s decadal high $268 bln adding to a non-federal record of $174 bln.
‘In fact, since the Voodoonomics-II first came into conjunction with the bursting of the Bubble in June 2001, the past seven quarters have seen a $582 bln gain in this measure – a near 13% increase – and equivalent to more debt than actually existed as recently as 1975, meaning that just seven quarters of profligacy have managed almost exactly to replicate all the depredations practiced from Alexander Hamilton’s first pro-Whig/anti-Jeffersonian coup to the Bicentennial of the Republic.
‘However, if we add in the swelling Social Security deficit – for, as we have argued, it is logically indefensible to argue that the bonds held here somehow represent a societal ‘asset’, anymore than do those outside the laughingly-entitled ‘lockbox’ – the picture looks truly alarming.
‘For now we find that this same period since late Spring 2001 has seen Federal obligations rise, not by the $340 bln included in the calculation above, but by $900 bln – taking the total rise to just over $1.15 trillion, or around $1.6 bln a day...’
Way to go, Boys!
