US total debt per person ~=700,000 USD

[billstew]

US total debt per person ~=700,000 USD -- well that is what the calculations that I have done so far seems to be telling me.

http://hireme.geek.nz/wiki-spreadsheet.html

Admittedly, the technology needed to fully prove the 700k USD figure does not exist yet -- but economic crisises often bring about new intellectual ideas and technologies. I would like to be proven to be wrong by 20%, baseline nominal.

I am shocked that hyperinflation has not hit the US yet as the average household (~2.28 people) has 1,596,280 USD of debt on its head.

[TRake]

I am glad that I don't quite fit that description as my personal debt is merely ~~230k. The only problem I have is that my US reported income is merely 59k, and I support a wife and 2 kids. I am just praying that gold will go high enough to make my .242 troy oz $5 1986-W commemerative gold liberty rated MS-70 by ICG worth enough to cover my debt for that is the only physical gold I have at the moment.
This would require gold to go to $1,000,000 per troy oz. How likely is that? Am I off the reservation???????

[bpr]

Not sure where these figures come from:

Total US Tax Paying Population 200,751,673

According to the IRS (http://www.taxfoundation.org/research/show/1410.html), there were only about 136 million income tax returns for 2006, and 42 million of them had no tax liability.

Also, the debt numbers seem quite off the mark. $53 trillion in Federal debt? Sounds inflated by a factor of 4 (maybe three after this week's news). The Fed (http://federalreserve.gov/releases/g19/current/g19.htm) releases consumer projections of $2.596 trillion (revolving and non-revolving; I believe homes are excluded), but the guesstimate here is $20 trillion.

As for the $1 million ounce, I don't think our debt (or houses or jobs or anything) would matter at that level.

[Rajiv]

The figure above includes government debt ~ 50% of the total -- so you aren't off the hook -- particularly as the bottom 60% of the US population's per person amount of personal endebtedness are not that high.

[billstew]

Not sure where these figures come from:

According to the IRS (http://www.taxfoundation.org/research/show/1410.html), there were only about 136 million income tax returns for 2006, and 42 million of them had no tax liability.

Also, the debt numbers seem quite off the mark. $53 trillion in Federal debt? Sounds inflated by a factor of 4 (maybe three after this week's news). The Fed (http://federalreserve.gov/releases/g19/current/g19.htm) releases consumer projections of $2.596 trillion (revolving and non-revolving; I believe homes are excluded), but the guesstimate here is $20 trillion.

As for the $1 million ounce, I don't think our debt (or houses or jobs or anything) would matter at that level.

If you count people paying property taxes, sales taxes, state level taxes, import duties etc ... the 200,000,000 number is not that unreasonable (and maybe too low).

My model is not burdened exclusively by the existence of the IRS.

ALSO:
I could not find the IRS taxpayer numbers, nor do give them full weight.

Taxes are not exclusively a federal matter -- and I define a tax payer as someone who pays:

Federal + State + Local + Misc_Tax_types > Total governmental goods and services consumed.

NB: ">" is defined here where the differential is 1 USD nominal.

[billstew]

The figure above includes government debt ~ 50% of the total -- so you aren't off the hook -- particularly as the bottom 60% of the US population's per person amount of personal endebtedness are not that high.

Strictly speaking from the GAAP rules your above point is true.

My debt model (that is also based on these same GAAP rules) implies that regardless of 60% of the population "appearing not to have much debt" (on their heads) -- that the exact opposite is true.

When average_debt_per_person > average_lifetime_GDP_per_person (taxable, as a constraint may or may not be applicable;) the economic system is doomed to failure -- it does not so much matter the mixture of where the debt comes from.

Maybe the wording could read:

IF AND ONLY IF
avg_debt_per_person > avg_taxable_productivity_per_lifetime
THEN Economic_System_Failure = False.


Note:
GDP and GNP may be exchangeable here in the wording -- but should not affect the basic premise.

[Rajiv]

Bill, I was agreeing with you, and suggesting that the personal endebtedness of individuals may not matter as much in the calcualtions that you have done -- which is a good piece of work.

However, When average_debt_per_person > average_lifetime_GDP_per_person gives you an upper limit. However, I believe that collapse will occur much sooner, as per Hudson, when the ability of the system to pay compounding interest ceases.

See also the work of Richard C. Cook, and the social credit movement. See my comments here (http://www.itulip.com/forums/showpost.php?p=80161&postcount=1) and here (http://www.itulip.com/forums/showthread.php?t=8389)

[billstew]

Bill, I was agreeing with you, and suggesting that the personal endebtedness of individuals may not matter as much in the calcualtions that you have done -- which is a good piece of work.

However, When average_debt_per_person > average_lifetime_GDP_per_person gives you an upper limit. However, I believe that collapse will occur much sooner, as per Hudson, when the ability of the system to pay compounding interest ceases.

See also the work of Richard C. Cook, and the social credit movement. See my comments here (http://www.itulip.com/forums/showpost.php?p=80161&postcount=1) and here (http://www.itulip.com/forums/showthread.php?t=8389)


Yes, I could tell that you were agreeing with me -- but not everyone would always get that impression -- thus the clarifications.

The spreadsheet model is massively oversimplified -- and the numbers in it are hard to come by. This debt model is like a Wright Brothers plane vs the Concorde it needs to be. The core problem is so much debt existing that not a single person knows how much total debt their really is...

My insertion of tax paying persons is only intended to clarify the meaning of governmental debt -- it does not have any substantial functionality for personal and corporate debt.

People that actually [pay taxes] > [government goods and services consumed] are generally tied to some corporate entity. In that respect corporate debt and governmental debt are intertwined. My current modeling for this effect is very poor -- but in the end their are not enough of them to make a difference ... thus the mess we are in.

If you do look at debt and credit from the GAAP accounting rules, the real world economics in the developed world has mostly separated itself from the core accounting principals that must be obeyed if you want to maintain a sound economy.

Countries that may evade the worst by having followed GAAP principals


Australia
Canada (jury still out)
NZ, but this is not known for certain

[billstew]

Here is the updated spreadsheet, the population numbers are slightly in the future.

<table border="0" cellspacing="0" cols="4" frame="void" rules="none"> <colgroup><col width="94"><col width="343"><col width="158"><col width="304"></colgroup> <tbody> <tr> <td align="left" height="18" width="94">
</td> <td align="left" width="343">Known Data</td> <td align="left" width="158">
</td> <td align="center" width="304">Notes & Sources</td> </tr> <tr> <td align="left" height="18">
</td> <td align="left">Total US Population</td> <td sdval="306001001" sdnum="1033;0;#,##0" align="right">306,001,001</td> <td align="right">Millions of people via US Census Clock</td> </tr> <tr> <td align="center" height="18">guesstimate</td> <td align="left">Total US Working Population</td> <td sdval="253980830.83" sdnum="1033;0;#,##0" align="right">253,980,831</td> <td align="right">US residents with tax generating income</td> </tr> <tr> <td align="center" height="18">guesstimate</td> <td align="left">Total US Tax Paying Population</td> <td sdval="208264281.2806" sdnum="1033;0;#,##0" align="right">208,264,281</td> <td align="right">US residents “taxes > govt resources used”</td> </tr> <tr> <td align="left" height="18">
</td> <td align="left">
</td> <td sdnum="1033;0;#,##0" align="left">
</td> <td align="right">
</td> </tr> <tr> <td align="center" height="18">guesstimate</td> <td align="left">Removal Working Population from % pop</td> <td sdval="0.17" sdnum="1033;0;0.00%" align="right">17.00%</td> <td align="right">Remove children and elderly poor</td> </tr> <tr> <td align="center" height="18">guesstimate</td> <td align="left">Removal non-Tax Paying Pop from % Working Pop</td> <td sdval="0.18" sdnum="1033;0;0.00%" align="right">18.00%</td> <td align="right">Remove nominal tax payers</td> </tr> <tr> <td align="center" height="18">
</td> <td align="left">Governmental Interest Rate Average</td> <td sdval="0.0455" sdnum="1033;0;0.00%" align="right">4.55%</td> <td align="right">Guesstimate</td> </tr> <tr> <td align="center" height="18">
</td> <td align="left">Commercial Interest Rate Average (non CC)</td> <td sdval="0.085" sdnum="1033;0;0.00%" align="right">8.50%</td> <td align="right">Guesstimate excluding Credit Cards</td> </tr> <tr> <td align="center" height="18">
</td> <td align="left">Consumer Interest Rate Average, housing</td> <td sdval="0.075" sdnum="1033;0;0.00%" align="right">7.50%</td> <td align="right">Guesstimate</td> </tr> <tr> <td align="center" height="18">
</td> <td align="left">Consumer Interest Rate Average, non housing</td> <td sdval="0.1555" sdnum="1033;0;0.00%" align="right">15.55%</td> <td align="right">Guesstimate, mainly for credit cards</td> </tr> <tr> <td align="left" height="18">
</td> <td align="left">
</td> <td sdnum="1033;0;#,##0" align="left">
</td> <td align="left">
</td> </tr> <tr> <td align="center" height="18">
</td> <td align="left">Federal Government Debt</td> <td sdval="53010100100100" sdnum="1033;0;[$$-1009]#,##0;-[$$-1009]#,##0" align="right">$53,010,100,100,100</td> <td align="right">Dollars (2009)</td> </tr> <tr> <td align="center" height="18">
</td> <td align="left">State Government Debt</td> <td sdval="5010100100010" sdnum="1033;0;[$$-1009]#,##0;-[$$-1009]#,##0" align="right">$5,010,100,100,010</td> <td align="right">Dollars (2009)</td> </tr> <tr> <td align="center" height="18">
</td> <td align="left">Local Govt Debt (county, city, water districts, etc)</td> <td sdval="3501000100011" sdnum="1033;0;[$$-1009]#,##0;-[$$-1009]#,##0" align="right">$3,501,000,100,011</td> <td align="right">Dollars (2009)</td> </tr> <tr> <td align="center" height="18">
</td> <td align="left">Consumer Housing Debt</td> <td sdval="30000100100100" sdnum="1033;0;[$$-1009]#,##0;-[$$-1009]#,##0" align="right">$30,000,100,100,100</td> <td align="right">Dollars (2009)</td> </tr> <tr> <td align="center" height="18">
</td> <td align="left">Consumer Credit Card Debt, Car Loan Debt etc...</td> <td sdval="20000100100101" sdnum="1033;0;[$$-1009]#,##0;-[$$-1009]#,##0" align="right">$20,000,100,100,101</td> <td align="right">Dollars (2009)</td> </tr> <tr> <td align="center" height="18">
</td> <td align="left">Commercial Sector Debt</td> <td sdval="10000000100011" sdnum="1033;0;[$$-1009]#,##0;-[$$-1009]#,##0" align="right">$10,000,000,100,011</td> <td align="right">Dollars (2009)</td> </tr> <tr> <td align="left" height="18">
</td> <td align="left">
</td> <td sdnum="1033;0;[$$-1009]#,##0;-[$$-1009]#,##0" align="left">
</td> <td align="left">
</td> </tr> <tr> <td align="center" height="18">subtotals</td> <td align="left">Interest Incurred Debt (commercial, 5 years)</td> <td sdval="4250000042504.68" sdnum="1033;0;[$$-1009]#,##0;-[$$-1009]#,##0" align="right">$4,250,000,042,505</td> <td align="right">Trillions of constant dollars (2009)</td> </tr> <tr> <td align="center" height="18">subtotals</td> <td align="left">Interest Incurred Debt (consumer, 7 years)</td> <td sdval="37520161511512.4" sdnum="1033;0;[$$-1009]#,##0;-[$$-1009]#,##0" align="right">$37,520,161,511,513</td> <td align="right">Trillions of constant dollars (2009)</td> </tr> <tr> <td align="center" height="18">subtotals</td> <td align="left">Interest Incurred Debt (governmental, 20 years)</td> <td sdval="55984292273110.1" sdnum="1033;0;[$$-1009]#,##0;-[$$-1009]#,##0" align="right">$55,984,292,273,110</td> <td align="right">Trillions of constant dollars (2009)</td> </tr> <tr> <td align="left" height="18">
</td> <td align="left">
</td> <td sdnum="1033;0;[$$-1009]#,##0;-[$$-1009]#,##0" align="left">
</td> <td align="right">
</td> </tr> <tr> <td align="left" height="18">
</td> <td align="left">Debt Total</td> <td sdval="219275854427460" sdnum="1033;0;[$$-1009]#,##0;-[$$-1009]#,##0" align="right">$219,275,854,427,460</td> <td align="right">Dollars (2009)</td> </tr> <tr> <td align="left" height="18">
</td> <td align="left">
</td> <td sdnum="1033;0;[$$-1009]#,##0;-[$$-1009]#,##0" align="left">
</td> <td align="right">
</td> </tr> <tr> <td align="left" height="18">
</td> <td align="left">Implied outcomes</td> <td sdnum="1033;0;[$$-1009]#,##0;-[$$-1009]#,##0" align="left">
</td> <td align="right">
</td> </tr> <tr> <td align="center" height="18">subtotals</td> <td align="left">Debt per person</td> <td sdval="716585.415442678" sdnum="1033;0;[$$-1009]#,##0.00;-[$$-1009]#,##0.00" align="right">$716,585.42</td> <td align="right">What is owed per person</td> </tr> <tr> <td align="center" height="18">subtotals</td> <td align="left">Debt per working person</td> <td sdval="863355.922220094" sdnum="1033;0;[$$-1009]#,##0.00;-[$$-1009]#,##0.00" align="right">$863,355.92</td> <td align="right">What is owed per working person</td> </tr> <tr> <td align="center" height="18">subtotals</td> <td align="left">Debt per (working) tax paying person</td> <td sdval="1052873.07587816" sdnum="1033;0;[$$-1009]#,##0.00;-[$$-1009]#,##0.00" align="right">$1,052,873.08</td> <td align="right">What is owed per tax paying person</td> </tr> <tr> <td align="center" height="18">subtotals</td> <td align="left">Debt per {Household} </td> <td sdval="2116872.91442221" sdnum="1033;0;[$$-409]#,##0.00;[RED]-[$$-409]#,##0.00" align="right">$2,116,872.91</td> <td align="right">Total owed per household (2.28 per House)</td> </tr> </tbody> </table>