Friday, February 26, 2016

Fed Financials: Support Silver Senator 2016 Here Now

US government releases 2015 financial statements

US government just published audited financial statements this morning, signed by Treasury Secretary Jack Lew.

These reports are intended provide an accurate accounting of government finances, just as any big corporation does.
US government’s financial condition declined significantly from the previous year.

For 2015, US government reports $3.2 trillion total assets.

This includes everything from financial assets like bank balances to physical assets like tanks, bullets, aircraft carriers, and the federal highway system.

Curiously, the single biggest line item among these listed assets is the $1.2 trillion student loans owed to the US government by the young people of America.

37% of US government’s total reported assets are student loans, now considered one of the most precarious bubbles in finance.

$1.2 trillion is similar to the size of the subprime mortgage market back in 2008. 

Student loan delinquency rates are rising, now 11.5% according to Federal Reserve data.

So much of the federal government’s asset base is tantamount to indentured servitude as young people pay off expensive university degrees that barely land them jobs making coffee at Starbucks.

On the other side of the equation are a reported $21.5 trillion in liabilities, giving US government an official net worth of negative $18.2 trillion.

This is lower than last year’s negative $17.7 trillion and $16.9 trillion the year prior.

Each year these financial statements are audited by the government’s in-house agency known as the Government Accountability Office (GAO).

All big companies publish financial statements reviewed by an independent audit firm.

Auditors are a critical component of the financial reporting process.

It’s their responsibility to make sure shareholders and the public can have confidence in financial statements.

When Apple publishes an annual report, auditors go through all the assets and books of the company to make sure management accurately represents the company’s true condition.

When an auditor issues a failing grade, or what’s known as a qualified opinion, there’s hell to pay.

At the very hint of impropriety a company’s stock price tanks immediately. People get fired. SEC investigations are launched.

Based on US securities law and section 404 of the Sarbanes-Oxley Act from 2002, senior executives face criminal charges if their companies receive a failing grade from their auditors.

Year after year the GAO gives the federal government a failing grade in its audit report of America’s financial statements.

In this latest report, not only did GAO chastise the federal government for its “unsustainable fiscal path”, they stated US federal government consistently failed to prepare “reliable and complete financial information– both for individual federal entities and for the federal government as a whole.”

Department of Defense, Department of Housing Urban Development, and Department of Agriculture were all singled out for their failure to prepare complete and accurate financial statements.

This was corroborated by a report published last year stating, the Defense Department somehow “misplaced” $8.5 trillion of taxpayer money over the last 20 years.

GAO cited other material weaknesses in government reporting of supposed cost reductions in Medicare and Social Security.

In all, the GAO calculates US government financial uncertainties total $27.9 trillion, suggesting government’s true financial condition may be far worse than reported.

Bottom line– if this were a private company, Barack Obama and Jack Lew might be wearing dayglo orange jumpsuits in court while facing felony fraud charges.

It’s not just the $18.2 trillion in negative net worth. 

Or the $41+ trillion (by their own calculations) in the Social Security shortfall.

It’s the fact that they can’t even stand in front of the American people with an honest accounting of how pitiful the financial situation really is.

The government of the United States is totally, desperately, hopelessly bankrupt. 

US government becomes even more insolvent with each passing year.

Nearly every single dominant superpower throughout history was eventually consumed by unsustainable finances.

In their decline from power, bankrupt governments relied on a simple playbook to try to maintain the status quo by every means available.

They went to war.

They destroyed freedom. 

They imposed a police and surveillance state. 

They seized assets and wages. 

They waged campaigns of violence and intimidation.

They imposed capital controls. Cash controls. People controls. Whatever it took.

This time is no different. 

The finances of the US government are clear, as is the trend.

We’re not talking about what ‘might happen’ or ‘could happen’. 

We’re talking about what IS happening.

This is not a risk consequence free environment.

No comments:

Post a Comment