Hey Barnsty,Here is the U.S. part of that article.However, the...

Hey Barnsty,

Here is the U.S. part of that article.

However, the oddest thing about this whole development is that the USs fiscal condition is in fact AS BAD IF NOT WORSE than Greeces.

The US is expected to run a $1.7 trillion deficit this year. Assuming that the GDP numbers are accurate (theyre not, but thats an article for another time), the US economy is in the ballpark of $14 trillion. This means were running a deficit equal to 12.3% of GDP. Thats RIGHT next to Greece.

Then of course, youve got our Debt-to-GDP ratio. If you ignore unfunded liabilities like Social Security and Medicare, the US already has a Debt-to-GDP ratio of 98.1%. Thats only slightly off of Greeces Debt-to-GDP of 112%.

Throw in Fannie and Freddies mortgage debts (Uncle Sam own $5 trillion of these now too), and were already well over a Debt to GDP of 112% (actually its 130% or so). And when you include Social Security and Medicare ($45 trillion) this puts total US Debt-to-GDP at 421% ($59 trillion of Debt on a GDP of $14 trillion).

Everyone knows this. Heck, even USA TODAY (not exactly the cutting edge in financial research) notes that in order to pay off our current liabilities, every US family would have to pay $31,000 a year for 75 YEARS!!!

In plain terms, for the US to be criticizing Greeces debt levels is beyond the pot calling the kettle black. Its like a Black-hole calling a kettle black. At this point, were beyond broke. Even if the US taxed 100% of all personal income, we couldnt pay our debt off for years (at least five)

So its small surprise that fewer and fewer investors are willing to lend to the US for any lengthy amount of time. Were not even half way through the year and already weve had several long-term debt auctions that were fishy to say the least. Ill detail precisely what Im talking about in tomorrows essay. In the meantime, start preparing for the Greece situation to hit US shores. Were no better off than Greece, were just larger, and have a trigger-happy money printer for a Fed Chairman.
Good Investing!