If nations are in debit and banks loosing money who is lending nations the money to be in debit im very confussed?

Yet every Tom, Dick and Harry thinks they have the solution: "gold", "belt tightening", "reform", etc, etc, etc....In a nutshell: banks have money to lend because people have deposited money in the bank, and they tend to keep it there for a long time. While it's there, on the books, the banks take the liberty of loaning out your money! They've convinced legislators that it's perfectly okay for them to loan out most of your money-- they only have to keep a tiny bit of it around.

That's why banks can "fail" if they get an unexpected run of people wanting to take their money out-- most of it is lent out, making the bank money with YOUR money. Sneaky, eh? Then if the bank "fails", if say they put all your money on the next Arnold Schwartzenegger movie, then they just go crying to Congress and get them to refill their coffers with YOUR tax dollars.

Nice job if you can get it. BTW, neither banks nor the govt, as you often hear, sometimes twice a day, they don't just "print money". Greenbacks are not the same thing as "capital".

I'll try to give as clear and middle ground an answer as possible. Governments borrow money to make up the difference they don't make it collecting taxes or revenue, this is normally through what they call bonds I OWE YOU. These bonds are sold in various forms with lengths of required investments terms, 5, 10, 30 years etc.The governments says to investors (other governments, pension funds, individuals etc) of these bonds in exchange for lending us this money we will pay you interest on these bonds every whatever the term for the bond.

Hence all the talk of interest rates, which generally are set depending on how secure the investment is. The banks on the other hand as stated before make their money by lending your money you put with them out to other banks, companies and individuals for whom they change an interest on that money. Now the debit you spoke of comes in to play when basically there is an imbalance or lack of appetite for that debit.

Low prospects for the bank to continue making money or more expenditure that the government has than the prospect for it to raise revenue through taxes or bond auctions. This is what investors evaluate when they consider investing in a bank or government.

The banks are not owned by the government. A bail out is not a purchase.

No, you are not stupid, or at least not stupid for thinking along this line. That should have been a question brought up during the debt ceiling debates we recently had. Many people think that the solution is to just raise the debt limit.So they give the Treasury the authority to borrow more money, they can't vote the Treasury the ability to raise said funds.

But they always come up with the 'borrowed funds'. That is what the whole 'quantitative easing' stuff was about. There were no big lenders at the auction window so the Fed steps in and issues funds.

The terminology is 'printing money' although most is just electronically conjured up out of thin air. It is inflating the currency. They say we borrow about .40 of every dollar we spend but the reality is more like we borrow about .10 and make up about .30.

You can also make your numbers by tricky accounting. Remember TARP?'troubled asset relief program'- well a troubled asset is really a liability. You can take a large negative number on a balance sheet and convert it to a large positive number if you just change the definition.

We are in a different position than a country like Greece. They can't print their way out of an imbalance. Our currency is the world's reserve currency.

It is in a round about way backed by something. When Libya pumps oil out of the ground and sells it, they are pumping dollars not euros. Obama has inflated the currency and a barrel of oil costs roughly twice now what it did when he came to office.

If you noticed last week Vladimir Putin called the USA parasites for the way we treat our currency and influence everyone else's currency. And he's right. We were able to export lots of our inflation.

It is the opinion of many people that this sort of behavior is uncool. The world is taking steps to remove the parasite and it will not be pretty when we are forced to live within our means.

I cant really gove you an answer,but what I can give you is a way to a solution, that is you have to find the anglde that you relate to or peaks your interest. A good paper is one that people get drawn into because it reaches them ln some way.As for me WW11 to me, I think of the holocaust and the effect it had on the survivors, their families and those who stood by and did nothing until it was too late.