World needs a new economic system by 2075

I owe the world $26 trillion and I will never pay it back.

What if your biggest creditor says that to you, it also wants perpetual rollovers and requires more funding as well. That is the prospect around US Government debt…

here is the link to US debt clock:

http://www.usdebtclock.org

In my view this amount will not reduce in any time in the near future, even under any republican plans, at most they may have surplus (yes I am being extremely optimistic here) for a short time before spending all that on lower taxes. The other thing to notice here is that it is increasing currently at near zero percent interest rates, a 1 percent interest rate rise will create additional burden of $260 billion on US Government budget.

The situation is not any better for most of the world governments be it the UK, Japan, most economies in Europe. I picked US here since US Dollar is currently the only viable global reserve currency and it is issued and backed up by a very precarious financial position.

And the point is….

I look at various budgeting strategies of global governments with amazement. The current economic system in the world means a perpetual refinancing of debt and ever increasing more borrowing for all governments. It sounds like and perhaps is a never ending big Ponzi scheme and governments are saved by the finite lives of humans and absence of any alternative economic system. Those same heavily indebted Governments then issue currency and set interest rates on the basis of which global economy runs.

Assuming in the next 50 years humans do achieve the objective of prolonging life span to double or more. I believe at that time we certainly need new way to run global economy, issuance of currency and funding governments. Otherwise, let’s put a new financial word in our daily lives… anyone for greenback supported by one quadrillion US government debt in year 2100…that is $1,000,000,000,000,000 to pay no one and everyone at the same time….