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The Fiscal Cliff Will Cause Many to File Bankruptcy

The Fiscal Cliff Will Cause Many to File Bankruptcy
"There has been considerable coverage of the United States again going over the fiscal cliff. In October, when Congress refused to accede to the White House's demands, there was a shutdown of the federal government. At least, that's what they said. In reality, it was more a matter of the White House punishing individuals for the actions of Congress. In reality, the government spent $600 billion that month. That hardly sounds like a closure to me. The majority of Americans do not comprehend what is happening and how the United States came into this situation. The Democrats argue that tax increases are necessary for the United States to continue on its current trajectory. According to their numbers, the government has ran a deficit of $1 trillion per year for the past four years, which the majority of people do not realize. The United States would have defaulted on its debts a long time ago if it lacked the capacity to print its way out of debt. Currently, with QE4, the Fed prints $85 billion per month and uses it to purchase mortgage-backed securities. Now, there is talk of QE5. When will the elected officials declare that enough is enough?The 2013 deficit, according to Shadow Stats, was $6.8 trillion. According to the government, the United States has accumulated only $7 trillion in debt over the past four years. Furthermore, they use the word ""only"" sparingly. The majority of individuals do not care because they do not believe it affects them. In reality, it impacts each and every one of us because someone will have to pay off the government's debt. It will come either directly through tax increases or indirectly through higher fees and interest rates, which will cause enormous inflation. In any case, it will force many Americans into bankruptcy.This year, the Affordable Care Act and additional finance legislation have been passed and are currently becoming law as this is written. All of this will have a significant impact on how Americans will live and survive in the future. When the average family income in the United States is now close to $30,000 per year, it is difficult to believe that adding the cost of healthcare will assist anyone. Last year, the payroll tax was increased, resulting in reduced take-home pay. All of these factors will force many middle-class Americans to file for bankruptcy. It is almost as if they are attempting to eliminate the middle class as opposed to helping it.While all of this is occurring, the mainstream media continues to paint a rosy picture of the economy and convince us that we've reached a turning point because fewer Americans are filing for bankruptcy. Despite the fact that this number may have decreased over the past few years, there are explanations for this trend. According to one hypothesis, many Americans are incurring additional debt and delaying filing for bankruptcy. In addition, banks have recommenced lending to consumers and permitting them to carry large credit card balances. This is the same punch that was consumed prior to the 2007 housing frenzy and financial crisis. We are following the same course that led to a record number of Americans declaring bankruptcy in 2010. There is no means to fix it at this time, so everyone must prepare for the impact. Moreover, there has been discussion of the United States losing its status as a reserve currency due to its high level of debt. Time will tell how this will all play out when the rest of the world decides to cut up the United States' credit cards.
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"The Fiscal Cliff Will Cause Many to File Bankruptcy" was written by Mary under the Finance / Wealth category. It has been read 194 times and generated 1 comments. The article was created on and updated on 31 May 2023.
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