tlwmkw
newbie
Many of you here have given good explanations about our nations current credit crisis so I thought perhaps someone could explain this to me.
My question is this: If there is a liquidity crisis and no one is lending money then where is the government getting the cash for the bailout from? They keep telling us that there is a huge deficit and that it is growing so that means the government is still borrowing money from someone- Who? Why is money easily available to the gov if no one is lending?
I find this whole thing very scary because the gov keeps spending far more money that they collect in tax revenue. How can this continue? It wouldn't work for me if I kept on doing this (spending far above my income)- eventually no one would lend me money just like the banks that are failing due to lending to folks who couldn't afford the houses. Will the same thing happen to Uncle Sam? Will our government end up defaulting on the loan and then the US will belong to China or India? I just don't get it. If anyone can explain this please help me out.
My question is this: If there is a liquidity crisis and no one is lending money then where is the government getting the cash for the bailout from? They keep telling us that there is a huge deficit and that it is growing so that means the government is still borrowing money from someone- Who? Why is money easily available to the gov if no one is lending?
I find this whole thing very scary because the gov keeps spending far more money that they collect in tax revenue. How can this continue? It wouldn't work for me if I kept on doing this (spending far above my income)- eventually no one would lend me money just like the banks that are failing due to lending to folks who couldn't afford the houses. Will the same thing happen to Uncle Sam? Will our government end up defaulting on the loan and then the US will belong to China or India? I just don't get it. If anyone can explain this please help me out.