KUHTSU

A subject that will impact the globe, make it into history books, destroy wealth, crush families; in general, a catastrophic world warping event…to clearly illustrate “The Big Picture” is not what our company is about (or is it). Keeping Kuhtsu’s goals and objectives in mind and excluding Apocalyptic A-Bombs or pandemics; the US debt seemed like a good place for us to begin our journey together.
The general expert consensus is in; America will definitely default. None quite know when, but the majority agree default, like a thief in the night, is coming. If the experts agree on the diagnosis and prognosis, without action, what should be done to prevent it? After all, waiting only makes the negative impact worse when it occurs. Oddly, everyone knows how to fix it, but they would rather have the (mostly) invisible hand of the market tell them where to start, rather than doing it themselves.

At the end of the day, if your “goes-ins” are less than your “goes-outs”, you are running a deficit. Deficits create debt. You can solve this by getting more “goes-ins” or reducing your “goes-outs”. As many of us know, this can require a lot of tough decisions. If you are the US government, you don’t have to give up Starbucks or become a Walmart greeter. You can simply print more money, reduce inflation, or sell more bonds. If you want the details on this, of which there are many, feel free to read the oodles and oodles of literature from economic experts. Below is some summarized work product theft courtesy of Claude:
“The bottom line most experts share: doing nothing is the worst option. Waiting 5–10 years to act will require substantially larger adjustments than acting now, and the recommended path is a “thoughtful pro-growth deficit reduction package that begins promptly and phases in over time,” combining lower health care costs, securing Social Security/Medicare trust funds, spending reductions, and new revenue” – Mostly from the COMMITTEE FOR A RESPONSIBLE FEDERAL BUDGET

Having experienced 9/11, the global financial crisis, Covid, company desolations, our confidence that the America people (as well as the rest of the world) performs well, is not high. Maybe that is simply human nature’s inertia. Maybe we are simply programmed not to do anything until we must. How do you plan for an event of that scale? How would money be managed? How should you invest your money? Is real estate better than gold bars, are stocks better than bitcoin? How should a business invest its resources?

How much can a society withstand? As I write this, we are choosing not to invade Iran, because society wouldn’t accept the required casualties. We used to raise taxes to fight wars or sell war bonds. In effect, our current increased gas costs might be some type of war tax but paid to companies instead of the treasury. After a default, we could end up paying more for gas and higher taxes, to repay the debt. Right now the government is still able to sell bonds to service the debt, but that is at a 20+ year high. At some point, it’s increased tax city for all of us. How much can a society withstand?

And here is where I will downshift from the macro to the micro. Ultimately, these are not the questions Kuhtsu wants to help our client’s answer. The subject matter is simply too big with too many potentially unpredictable outcomes for us to spend our time resolving. Our species started with small communities, and we believe that is where the real joy of the human condition lies. Consider the orc. What if the orcs wiped out all the men, elves, and hobbitses. What if Sauron’s reconstitution was successful and the armies of darkness fill the corners of middle earth. Would they not have to develop agriculture and markets? Would that not need to construct orc baby schools? The church of Sauron needs road systems for his unholy mass each Sauronday, right? Without this wouldn’t the world simply die? Just one more desolate planet sailing through a black matter universe.

Therefore, I submit these grand good vs evil, total destruction, default questions have no real answer. Here at Kuhtsu we are more interested in the micro-questions. How can we band together, like the dwarves and hobbits of yore, and get that greedy dragon off our gold? What do we do with the gold once we have it? How about we exchange it with our neighbors and make each other’s lives a little bit better. Fewer orcs, fewer dragons, and more gold for everyone.