Trillions: Big Money Economics

An overview of money-world


(i.e. anything measured in trillions)


By the way, I am using the word to mean a thousand billion.

"A trillion can mean:

Either of the two numbers (see long and short scales for more detail):1,000,000,000,000 (one million million; 1012; SI prefix: tera-) - for all short scale countries - increasingly common meaning in English language usage.1,000,000,000,000,000,000 (one million million million; 1018; SI prefix: exa-) - for all long scale countries - increasingly rare meaning in English language usage but frequent in many other languages."


Before you read on: You MUST visit this link.

(A trillion seconds is 32,000 years). If all of the financial market interventions, loans, guarantees, bailouts and rescues are approved, they will total more than $7 trillion.


World GDP is an estimated 54.62T (2007)
US GDP was estimated as $13.8 trillion (2007)
1.149 trillion U.S. exports (2007)
1.985 trillion U.S. imports (2007)


As of June 2008, the gross U.S. external debt was over $13 trillion.

Public Finances
U.S. Expenses 2.696 trillion (2007)
U.S. Revenues 2.568 trillion (2007)

Apparently, the U.S. dept. of defense can't account for up to 25% of it's budget. That's 2.3T dollars, or 8k per u.s. citizen; LINK.

As of September 2008, the total U.S. federal debt was approximately $9.7 trillion, about $31,700 per capita (that is, per U.S. resident). Of this amount, debt held by the public was roughly $5.3 trillion. Adding unfunded Medicaid, Social Security, Medicare, and similar obligations, this figure rises to a total of $59.1 trillion, or $516,348 per household. In 2007, the public debt was 36.9 percent of GDP, with a total debt of 65.5 percent of GDP.

In Fall 2008, the debt is expected to reach the $10 trillion mark.
Further, benefits under entitlement programs will exceed government income by over $40 trillion over the next 75 years.

In September 2007, when the Congress raised the debt limit to $9.815 trillion. As of July, 2008, the recently passed "landmark housing bill" raises the current debt ceiling by US$ 800 billion to US$ 10.6 trillion to account for the potential bailout of the two mortgage giants Fannie Mae and Freddie Mac.

The on- or off-balance sheet obligations of those two independent GSEs (Gvt. sponsored enterprises) is just over $5 trillion.


The net exposure to taxpayers is difficult to determine at the time of the takeover and depends on several factors, such as declines in housing prices and losses on mortgage assets in the future. Over 98 percent of Fannie's loans were paying timely during 2008. Both Fannie and Freddie had positive net worth as of the date of the takeover, meaning the value of their assets exceeded their liabilities.

The global market capitalization for all stock markets was $43.6 trillion in March 2006.

Total third world debt was estimated to be $1.3 trillion in 1990.
Bribery is estimated to total 1 trillion dollars a year.

Sept. 29th's 777-point stock dive, "dark monday", the largest single point drop in history, was estimated to have been worth 1.2 trillion (upon the news of the bail-out bill not being passed). The tv said something like the stock market has lost 5000 points in the last 10 months, which can also be expressed as "4 trillion down the drain since last Oct."

I write (this) sentence Oct. 9, which has reached a new low today at the close at 4pm eastern, of 8,579.19, dropping 679 points, (compare to it's alltime high on this date a year ago, 10-9-07, of 14,164). How many trillion is that?

Besides Oct. 9 and Sept. 29, there was also Sept. 15 and Oct. 6 (all 2008):

On Sept. 15, also known as "Ugly Monday", the DJIA loses more than 500 points amid fears of bank failures, resulting in a permanent prohibition of naked short selling and a three-week temporary ban on all short selling of financial stocks. On Oct. 6, the DJIA closes at 9,955.50 after a 369.88 point drop, the first time the DJIA has been below 10,000 since December 2003


As of Dec. 31, 2006, the combined capitalization of all New York Stock Exchange listed companies was $25.0 trillion.

Total U.S. household debt, including mortgage loan and consumer debt, was $11.4 trillion in 2005. By comparison, total U.S. household assets, including real estate, equipment, and financial instruments such as mutual funds, was $62.5 trillion in 2005.

In 2003 $318 billion was spent on interest payments servicing the debt, out of a total tax revenue of $1.95 trillion.

There is an estimated 45-62 trillion dollars worth of CDS (Credit Default Swaps) on the market, as of 2007.

Credit default swaps are the most widely traded credit derivative product and the Bank for International Settlements reported the notional amount on outstanding OTC credit default swaps to be $42.6 trillion in June 2007, up from $28.9 trillion in December 2006 ($13.9 trillion in December 2005) and by the end of 2007 there were an estimated USD 45 to 62.2 trillion worth of Credit Default Swap contracts.

In the US, the Office of the Comptroller Agency reported the notional amount on outstanding credit derivatives from reporting banks to be $16.4 trillion at the end of March, 2008. Warren Buffett famously described derivatives bought speculatively as "financial weapons of mass destruction." In Berkshire Hathaway's annual report to shareholders in 2002, he said, "Unless derivatives contracts are collateralized or guaranteed, their ultimate value also depends on the creditworthiness of the counterparties to them. In the meantime, though, before a contract is settled, the counterparties record profits and losses--often huge in amount--in their current earnings statements without so much as a penny changing hands. The range of derivatives contracts is limited only by the imagination of man (or sometimes, so it seems, madmen)." Warren Buffett's Berkshire Hathaway has a market capitalization of $196 billion (chump change, lol).

Al Gore has a 5 Trillion dollar plan to save the world.


Al Gore challenged the United States to "produce every kilowatt of electricity through wind, sun, and other Earth-friendly energy sources within 10 years. "


Do it or Else..
"Gore's fantastic—in the truest sense of the word—proposal is almost unfathomably pricey and makes sense only if you think that not doing so almost immediately would result in an uninhabitable planet. Texas oilman T. Boone Pickens recently came out with a plan to generate 20 percent of America's power through wind. His estimate was that it would cost $1 trillion to build that capacity and another $200 billion to update our electrical grid to transmit that energy around the country. (And what would be the environmental impact of all those windmills dotting the countryside? Or solar panels covering our pristine deserts?)By my math, using Pickens's numbers, converting the whole economy to renewable energy in a short period of time might cost $5 trillion—and that is if you assume that government-led projects come in on budget. (Remember, the current U.S. gross domestic product is $12 trillion.) That would be like creating another Japan. Or fighting World War II all over again. The latter analogy is especially apt since the Gore Plan would effectively transform our free-market economy into a command-and-control war economy full of rationing and scarcity. Of course, there are many folks like Gore who view global warming as the moral equivalent of war. But Gore would extend the concept into the economic equivalent of war. Again, all this makes sense if you think we are doomed otherwise. "


I wouldn't say "doomed" exactly, but what do I know. Gore's worst case scenario should have us pretty worried, though. If we lost over 1T in a single day, then why not shell out 5T, right? Seriously, Obama should do something big. We should snowball our way through global problems, using cost-benefit analysis, and really make the world drastically better.

T. Boone Pickens says, As imports grow and world prices rise, the amount of money we send to foreign nations every year is soaring. At current oil prices, we will send $700 billion dollars out of the country this year alone — that's four times the annual cost of the Iraq war. Projected over the next 10 years the cost will be $10 trillion — it will be the greatest transfer of wealth in the history of mankind.

Canada
“The Athabasca oil sands contain the equivalent of 1.7 trillion barrels of oil,” Mr. Hansen says. “About 20 percent of that total can be produced, using current technology” – namely, surface mining and steam extraction underground. At today’s prices, tens of trillions of dollars’ worth of oil are at stake. The oil sands have attracted more than 100B in investment, so far." -csmonitor


ghg (green house gas)"- "the price you pay for the life you choose"


At the same time, Syncrude – a joint venture that includes Canadian Oil Sands Ltd., Imperial Oil (an ExxonMobil subsidiary), Petro-Canada, Nexen, Conoco Phillips, and others – is Canada’s largest single emitter of greenhouse gas, since it must burn 750 cubic feet of natural gas to generate the steam needed to produce a barrel of bitumen. That’s the equivalent of burning one barrel of oil for every eight barrels produced. Steam extraction water settles in highly toxic tailings ponds, too. Aboriginal communities are worried about toxic drinking water and poisoned fish.


As for corporations,
ING has $1,918,969,700,000 (about 1.9T) in assets
Fortis has $1,273,716,800,000 (about 1.3T) in assets
Citigroup has $2,187,631,000,000 (about 2.2T) in assets


(As a direct result of the U.S. subprime crisis, Citi’s 2007 profits sank 83.2% to $3.62 billion.)


The Fortune 500 ranking (by revenue) lists


Walmart as number 1, with 378,799,000,000 (about 379B) -there are no Trillion dollar a year revenue companies.


Is your head spinning yet? Remember, it's only money.



Although, there have been trillionaires, quadrillionaires, and quintillionaires in Zimbabwe. There's even a hundred-billion dollar note. Zimbabwe is suffering from an acute economic crisis. The country has the world's highest rate of inflation and just one in five has an official job.


WASHINGTON - Americans' retirement plans have lost as much as $2 trillion in the past 15 months, Congress' top budget analyst, in the Congressional Budget Office, estimated Tuesday.


Here's a factoid of dubious authenticity, from rense.com:


Retired management consultant Gaylon Ross Sr, author of Who's Who of the Global Elite, has been tipped from a private source that the combined wealth of the Rockefeller family in 1998 was approx (US) $11 trillion and the Rothschilds (U.S.) $100 trillion.


The author goes on to say that the billionaires are actually bit-players.
One family, 100 TRILLION dollars?


Currency, checking accounts and traveler's checks with a statistic called the M1 money supply. Adding money in money market funds, savings accounts and small CDs gives us the M2 money supply. The U.S. M1 money supply was $1.182 trillion in May 2002, and the M2 money supply $5.543 trillion.


"high net worth" individuals are said to be worth $30.8 trillion, From the Wall Street Journal (Online). July 25, 2005


An interesting quote:"The whole financial system is a house of cards. . If everybody decided to take what they had coming out of their accounts and bury it in the garden, the financial system would collapse, civilization would end, and we'd all go back to being hunter-gatherers. (J/K?) The modern world is made possible by the trust and sheeplike predictability of millions of depositors. (Deposit insurance makes it less of a crapshoot than it once was.)"

European governments have injected around 2T dollars into their troubled banking system.

One discussion group has a comment with an ominous warning:"For broad categories of things that are moneylike, look up M1, M2, and M3. Each category moves farther away from hard currency, and more toward things that are 'moneylike'.The government is stopping publication of the M3 figures, if I remember correctly. That's a VERY bad sign. It means they need to hide something."

As for gold, According to the BBC there is only enough discovered gold in the world to fill your average football stadium to the brim.I love how so much of our economy isn't in the "real" sector, as they say. What's going on...a huge portion of our economy is fake, phony, false, unreal? GET REAL, economy.

I also love how they call it a "bail out", as if the financial system were a canoe. Makes it sound as if there were too much liquidity, instead of the other way around.