Could you spend $100 Billion a week?

In 2009, the US Dollar Debt hit a whopping $12 Trillion.

These days, it’s about $12.8 Trillion. Soon it will be $13 Trillion.

Lately, the US Government has been adding about $100 Billion per week to the debt. Can you imagine spending $100 Billion per week?  Obama can.  The graph looks like this:

US Debt April 2010

And it’s not going to stop there. How do I know? Because, in the U.S., Congress must approve the limit of how much debt the US can accumulate.  Typically Congress only approves “small”, incremental increases every now and then to keep the debt in check.  However, check out the latest limit increase:

US Debt Limit

Reference: http://www.treasurydirect.gov/govt/charts/charts_debt.htm

Wow! That last increase is a little larger than usual, isn’t it? Now, do you think Congress approved such a large increase out of laziness to save themselves a few voting sessions, or did they approve such an increase because they plan on spending the money (printing more money). Gotta print it to spend it.

This is why the US Dollar is toast.  Printing that much more money is like adding water to soup… it makes the quality of the soup worse and worse.  Anything that is priced in US Dollars (like gold, oil, and other currencies such as the Canadian Dollar) should appreciate against the dollar into the future (assuming all else being equal).  This has many propagating effects, which I’ll save for a future blog.

I just wanted to share that limit increase, as I couldn’t believe it myself.