Two Florida school officials won't go to jail for praying

[kandrathe]

The numbers in that excel spreadsheet say exactly what I'm saying - that you're off by a huge margin. If those predictions are accurate, then US revenue has dropped by maybe 15%, 2008 to 2009. That's painful, but it's not a cataclysmic 60%.

Right. But you ignored my source, which said 60%. 2008 revenues were last year, and the 15% number was the drop in individual income tax revenues because layoffs didn't begin in earnest until the last half of 2008. Unemployment benefits are taxed, and most people get some amount of severance. Lack of employment (% employed) continues to be a growing problem. We need to look at % employment because the government no longer measures people who fall out of the system when their benefits run out. Then you skipped the number on corporate tax revenue which was down 58% in 2008, and down more in 2009 when you look at quarterly returns. This is what forced the CBO and the White house to revise their forecast at midyear, in essence telling us they under-predicted the severity of everything.

"Helicopter money" isn't Keynesian. In fact, the whole concept was dreamed up by Milton Friedman specifically to counter the Keynesian notion of a liquidity trap.

Well Friedman took Keynes one better. Keynes had the idea of printing large sums of money and burying it in mine shafts to stabilize the economy, and Friedman had the notion to give it away.

No doubt, assets were overvalued in early 2008, and now they're not. That's what a bubble is, and that's what happens when it pops. Don't confuse GDP with net worth - they are measuring two very different things.

Value is someone elses idea of what things are worth. I was saying government spending is a large portion of GDP. Borrow more, spend more, bigger government, bigger GDP.

Both you and the administration are making predictions of the future, so of course they are "fictitious" - how could they not be? Are they fraudulent? Overstated by 30%? On what basis? They might be overly rosy, but 30% is a gigantic amount. The US has not run to the end of its borrowing rope, and that the world's most powerful economy is probably not about to collapse utterly under a higher debt load. Whether you see the kind of recovery necessary to sustain that load is an open question. I hope the answer is yes, but I have no magic to reveal the future - and neither do you.

What does you gut tell you? Mine is telling me things are worse, and probably much worse than we know. I think next year there are literally thousands of bomb shells that are going to rock the economy, from unfunded pensions, to major corporate bankruptcy, to more states like California becoming insolvent. The cash infusion is running out, and growth is still stagnant. Meanwhile, one in five, to one in ten workers are unemployed or underemployed who are continue to become insolvent. Credit markets will begin to collapse, and the insurance companies who write off that debt, and the banks who run things. Borrowing cannot fix things, it can only delay when the piper actually get paid.