The Government Debt Paradox: Pick Your Poison

http://www.acting-man.com/?p=51318

"The Case Against Government Debt - PERIOD"

http://www.zerohedge.com/article/case-against-government-debt-period

When Japan collapses

http://theburningplatform.com/blog/2010/09/15/when-japan-collapses/

Fed prepared to act if economy worsens

In the "No $hit" category of Fed press conferences, Chairman Bernanke announced that the Fed was "prepared to act if the economy continued to weaken."

http://www.nytimes.com/2010/08/28/business/economy/28fed.html?_r=1

QE 2.0 is just around the corner. The problem is it won't end there.

Dr. Keynes killed the patient

http://www.realclearmarkets.com/articles/2010/08/20/dr_keynes_killed_the_patient_98632.html

American consumers are trying their best to deleverage. In terms of the story, the patient is actually trying to lose weight. But the government is blocking deleveraging and trying to boost consumption. They are forcing food down the patient's throat. According to the Flow of Funds Report, households reduced debt at a 2.4% annualized rate ($330 billion) during Q1 of 2010. Meanwhile, the federal government was piling on debt at an 18.5% annual rate ($1.44 trillion). Since every dollar of government debt is a promise to tax the private sector in the future with interest, this public spending spree effectively negated the Herculean efforts of the private sector to return to a sustainable path.

That's where the arrogance of Washington is really apparent. Scores of millions of American consumers have made the decision that reducing their debt burden is in their best interests right now. But a few hundred individuals in government believe they know better than the collective wisdom of the entire free market. By leveraging up the public sector, they have used their power to confiscate our savings. In short, they are forbidding us from following the common sense path to fiscal health.

If Greece is in trouble, where does that leave the US?

In many ways, the US sovereign debt problems are bigger than Greece's--much bigger. Click on chart to enlarge.