Are You Smart Enough to Understand Simple Math? - Exactly Why the USA will Collapse Soon

Updated on May 22, 2012

Why Taxing the Rich is Nothing More than Political Theatre and a Mathematically Impossible way to Solve the National Debt.

I am going to explain the problem of the National Debt in very simple terms anyone can understand. No Economics Degree Required. And this simplicity doesn’t even take into account the Personal Debt or State and Local Debt. California is claiming to be \$16 Billion in the hole just this year!

First I want you to understand You are Being Lied to by the Federal Government Every Single DAY! Before I get started on some very simple principals (So simple that even the mathematically challenged can understand easily) I’d like to point out an article today about counterfeit Chinese Parts being used in US Military planes. China is building US Military Equipment and we are supposed to believe they are our enemy? Has there ever been a better time to expose the FRAUD that is the US Military Industrial Complex? China has the 2nd largest expenditure on Military at \$100 Billion. The United States budgets for \$700 Billion… a full 7x more than China who is NOT our Enemy. So who exactly are we going to go to war with that justifies this expense? Please name one country that we should be worried about? This is why the United States Government had to create “Terrorists”. So they could keep feeding the lie to the people that we need to spend \$700 Billion a year on the military. You don’t think we could defend the United States on a paltry \$100 Billion a year or less like EVERY OTHER COUNTRY ON THE PLANET?

Why the Economy is Going to Collapse and the US Dollar will Be Abolished

As of right now as I write this article the US National debt is \$15.7 Trillion according to US Debt Clock dot org. Go see for yourself.

Here is what \$15.7 Trillion looks like as a number:

\$15,737,847,600,000 (I used the current number off the site)

There are approximately 320 Million Citizens

Here is what 320 Million looks like

320,000,000

What happens when we divide the Debt by the Number of Citizens?

15,737,847,600,000/320,000,000 = \$49,180.77 debt per person

So the Debt Per Citizen is currently just over \$49,000 per every man woman and child.

Now lets have some real fun and Stick it to the “Rich”.

If you believe numbers posted on Wikipedia (via Forbes Magazine) there are 412 billionaires in the United States of America. (Source: http://en.wikipedia.org/wiki/List_of_countries_by_the_number_of_US_dollar_billionaires). These Billionaires have a combined Wealth of \$4.6 Trillion. Now here is where it gets “Fun”. The United States Government will spend \$6.3 Trillion this year! (Source: http://www.usgovernmentdebt.us/total).

Follow along with me now… \$6.3 Trillion - \$4.6 Trillion = \$1.7 Trillion. So lets not talk about Taxing these Billionaires… lets take every last bit of wealth they have an liquidate it to pay off spending. See the problem yet? They don’t have enough money to even cover this year! Then what are you going to do? You are understanding the “Simple Math” to this point I’m sure, but it gets even easier… follow along. There are not enough "Rich" Billionaires to pay off even a years spending if we took everything they have not just raised their taxes!

The collapse of the dollar is 100% mathematically inevitable. When the dollar collapses, it will be by far the single biggest event in the entire human history. Everything will change in every town across the globe. And yet most people have not even begun to think about it, much less prepare for it.

What is Money?

Since the inception of the Federal Reserve Act of 1913 and Fractional Reserve Banking ALL MONEY IS DEBT. Excepting for Coin which is not loaned into existence MONEY IS DEBT.

Here is how it works in a simple analogy:

The US Government needs/wants more money so they either borrow it from financial markets/other countries (Debt) or ask the Treasury to Create more money by creating more Treasury Bonds. The Treasury Bonds are then purchased by the Federal Reserve Bank (Private Bankers) at a discount off the face value (Interest). The Federal Reserve then does a few mighty clicks on their keyboards and magically money is created. And that money has interest due!

In even simpler terms….

Lets say you need a \$100 to buy porn, cigarettes, and pay your drug dealer so he doesn’t beat you into oblivion. Or maybe you like most people are just a little short this month and need to feed your family. Either way the principal is the same.

You get someone to agree to loan you the \$100 (Federal Reserve). In exchange for the loan you agree to pay interest (Lets say 5%). So at some point later in time you owe \$105 (simple interest the time doesn’t matter in this case). So you got your \$100 but you have to pay back the \$100 + \$5 interest. Where does that \$5 come from? It doesn’t exist! You don’t’ have it. So how do you get it? Well if you are the Federal Reserve you simply create it at a later date! You make it out of nothing. That \$5 doesn't exist (Sorry no you can't steal it from someone else or borrow it as that would not solve the problem of the newly created \$5 debt... come on now, put on your thinking cap!).

This cycle of creating money and then having to create more money to pay off the debt is why the system is broken. It’s why it’s mathematically impossible to pay off the National Debt. Because the MONEY DOESN’T EXIST! YOU HAVE TO CREATE MORE DEBT TO COVER THE EXISTING DEBT!

Can you write a Check for \$49,000 and send it off to Uncle Sam? Can you get everyone else to do that? No you can’t... because you don't have it! And if you think there are those that do just reference the Billionaire Argument above.

Sure we can talk about “Servicing the Debt”… making perpetual payments that are Interest Only… but even the Interest on the Debt is out of reach, because the system relies on debt on top of debt, which is not infinitely sustainable.

So what is the Solution to the National Debt?

People want to make everything so complex. The Solution is simple. The US Dollar has got to go, The Federal Reserve has got to go, and Fractional Reserve Banking has got to go.

It doesn't matter what you think about "That could never happen"... because it's already in motion. The inept Politicians are doing nothing to deal with the problem. Raising the debt ceiling... seriously... that's hilarious. That's like saying, "hey my cup is leaking". And then offering this solution: Pour in more water!

Once the Dollar, Fed, and Fractional Reserve Banking collapse a new currency can be issued (It will still have to be created out of nothing), but it can have no interest attached to it. The currency has to be backed by something even if it is only perception. The “Growth” of the currency must be controlled to reflect a 1:1 ratio with real population and production growth. The currency must be controlled not by a select group of Private Bankers, but by the People.

Until this happens you can expect things to get worse, much worse, and they are.

Inflation is NOT Higher Prices

Inflation is a symptom of an expanding money supply. Inflation is the devaluation of the existing dollar by introducing more dollars into a pool of money without adding any value to the dollars being issued. Higher prices are the result of inflation.

Here is a very simple example of Inflation

You have a tribe of 100 people. Each person has \$10. So there is a total of \$1,000 in that Tribe’s Economy. They decide to set prices based on the \$1,000 available pool of money. Everything is great until 5 years down the road the Tribe Leaders decide to go to war with another tribe. But they do not have enough money to buy the equipment they need. So they decide to issue another \$1,000. Now they can go to war.

Here is the problem they have just created INFLATION. There are now \$2,000 to trade making the original \$1,000 worth half of what it used to be worth. And the people of the tribe realize there is now more money so they raise their prices (This is how inflation happens).

Last year the Federal Reserve Bank dumped \$7 Trillion of their FIAT Money into the World Banks… and you wonder why Groceries are going up?

Money is just Debt. And what matters is who you as a people, a country, a nation let control the supply of debt. When you let a select few Private Bankers control the money supply you get super rich on one end, hardworking masses enslaved to those super rich in the middle, and MASSIVE SUFFERING by everyone on the other end who has no access to the money supply.

It’s great to be human right?

All of this CAN BE FIXED. But it is NOT going to be fixed because the evil people who are living like Royalty off of your labor do not want to ever have to work for a living.

25

205

51

114

Popular

80

99

• Causes of underdevelopment, Strategies for development

6

Submit a Comment

• AUTHOR

MikeNV

6 years ago from Henderson, NV

I have seen the Youtube video. Normally I deny comments with links, but I let this one in because it's worth watching. The class warfare created by the far left inciting the masses with the lie that somehow the "Rich" are screwing them over is clearly not true. They simply do not understand that under the existing monetary system ALL MONEY IS DEBT. The only way to "fix" is to get away from a Top Heavy Debt based monetary model. Thanks

• Russ Moran - The Write Stuff

6 years ago from Long Island, New York

Yes, the math is simple and scary. I don't know if you've seen this classic video on this subject. Eat the Rich http://t.co/g90XMCA

• Brett Caulton

6 years ago from Thailand

You certainly have a way with words! I agree with what you say, as the banking system has been flawed ever since it was allowed to loan more than a set percentage of the actually money/assets that it held. Nowadays, money is just invented to keep things going, but this can't realistically continue inevitably ... a scary and interesting time is ahead.

Shared, up and awesome.

• AUTHOR

MikeNV

6 years ago from Henderson, NV

They don't block me because I own the content and they make a lot of money of me for doing nothing. That's reality.

6 years ago

hey Mike, good points you make in this bit, nicely written too - although I'm surprised they haven't blocked your account yet :) keep up the good work!

• AUTHOR

MikeNV

6 years ago from Henderson, NV

The Bottom line is still that a system that creates money out of nothing and is loaned into existence at interest will EVENTUALLY COLLAPSE REGARDLESS of who is doing what because the PERPETUAL DEBT MODEL doesn't work. It can not work. It's only a matter of time before it collapses.

The True Blueprint for Disaster is the Federal Reserve and FIAT MONEY under a debt model of Fractional Reserve Banking.

So Tax, Spend, Borrow, Print... still doesn't matter. The "Math" is very simple.

• AUTHOR

MikeNV

6 years ago from Henderson, NV

The simplest way to understand why the System is broken is this.

If you create a dollar and loan it into exitance at interest. The money to pay the interest does not exist. So at some point the only way to pay the interest is to print even more money. Eventually the dollar becomes so devalued that it's worthless.

At this point today's dollar is worth about 4 cents compared to the collar that existed when the Federal Reserve Act was put into play in 1913.

Game Over. Perpetual Debt is crashing under it's own weight.

• Anthony Goodley

6 years ago from Sheridan, WY

I agree with every word you wrote here. I have researched some of the things you mention here like how our money is created out of debt, the fractional reserve banking system and fiat money and you really do know what your talking about here. You have a clear understanding of the problem and the inevitable crash that must happen sooner or later. I'm betting on sooner and truly believe that those in power wish to crash the dollar and the US economy in the process. Which of course would royally screw things up on a global scale too...

Why else would the Fed keep printing up trillions of dollars annually if they didn't care about the negative effects??

Our founding fathers were very opposed to a Central Bank, which is what the Federal Reserve is. So much so they had to fight twice to kill off efforts to implement one. Sadly they finally got one in place with the Federal Reserve. The dollar has been losing value ever since and is almost to the point it can no longer lose any more of it's purchasing power.

Oh yes one last very important point. Sometime last Fall or Winter our national debt surpassed GDP according to the debt clock you referenced. How can you pay off your debts when you owe out more than you have coming in? It is a point of no return unless our expenditures are drastically reduced. Yea right... LOL

• JON EWALL

6 years ago from usa

MikeNV

The blueprint for a disaster is that the government has not approved a budget since Obama took office in 2009. Congress and the President ignores the laws that they passed regarding spending money and taxation of the citizens. One party believes that taxing the rich MORE will solve the problems. The other party is agreeable to more taxes ( Fairer on all parties ) only if spending is cut to make the transaction , deficit neutral.

Both parties are playing roulette with the American economy as they make matters worst. Check these links and be the judge.

1. The Senator Coburn report '' WASTE IN GOVERNMENT'' http://coburn.senate.gov/public/index.cfm/rightnow...

2. 5/09/12

Obamacare, Taxing jobs out of existence

WHY are companies not hiring?

http://www.humanevents.com/article.php?id=51364

3. 4/10/12

Potential impact of Obama's 'Buffett rule ' President Obama’s

2011 tax returns rate was . 20.5 % , a lot less than his secretary

http://www.foxnews.com/on-air/your-world-cavuto/20...

4. The President's Speech Distorts the Truth to Distract From His Failed Record

5. PAYGO compels new spending or tax changes to not add to the federal deficit.

http://chicagoconsultant.com/page2.php?category=2&...

6.Social Security Revenues Have Been Used to Mask Deficits

https://hubpages.com/politics/What-Social-Security...

Washington is CORRUPT!

In Nov. we the people will have our opportunity to make the changes necessary to save our country.

• breakfastpop

6 years ago

Great hub. Do us all a favor and send it to the Obama and the Dems. Up and interesting and useful too.

• Deforest

6 years ago from USA

There's something that I misunderstood if the tribe has more money in what way is it compelled to increase the prices therefore creating inflation, weakening parallelly

its economy? Doesn't it go against its own interests?

• James Ranka

6 years ago from Port Neches

Excellent information! I've known these figures and equations to be real and provable, but seems to me, most Americans don't give a flyin' rip. They continue to post the same, silly "discover your angel" wording surrounded by flowery borders on Facebook and go their merry, ignorance is bliss ways. The day of reckoning WILL soon be here . . . and VERY few realize the severity of this upcoming upheaval!

working