[The Dark Wolf]

Originally Posted by Drew

Jeez, makes you wonder what ours really is.

Is there any nation actually in the black? I mean, you figure statistically there must be, but I don't believe I've ever heard of one...

Get ready for it...


Russia.

They've been running in the black for awhile now. I heard it the other day on NPR. Go figure!

[Leon]

alright, so i'm dumb when it comes to finance . what does being "in the black" mean?

[Drew]

Originally Posted by The Dark Wolf

Get ready for it...


Russia.

They've been running in the black for awhile now. I heard it the other day on NPR. Go figure!

It's official, fellas - we lost the cold war.

Leon - "in the black" means you're runninga profit, as opposed to "in the red" which means you're running a deficit. Check out some of the accounting format types for Excel for a great visual example.

[noodles]

Originally Posted by Drew

And to be anal, while we were running a surplus for the first time since probably the Roosevelt era, we didn't HAVE a surplus - we were still in national debt, it's just we were posting surpluses that had us projecting to pay off the national debt by 2010.

Absolutely correct, but worded wrong. We had a budget surplus, but a national debt. This means that we owed money, but the government was bringing in more money than it needed. This surplus was being used to pay off the debt.

The side effects of this was the strengthening of the dollar, while inflation started slowing way down. All of the sudden, the prices of goods and services came way down--while it was actually the value of the dollar going up, currency is "fixed", and everything else changes around it. When people spend more, businesses grow larger to fullfill the need. This means creating new jobs and giving handsome raises to retain people. What do people do with extra money? You can see how this becomes cyclic. With interest rates down, people were getting loans to buy cars and houses left and right. With the economy booming, people were investing more.

Thank Alan Greenspan, and Bill Clinton for listening to him. The policy of "tightening the belt" with taxes, coupled with Al Gore's personal vendeta against government spending, was to solve the problems created by the "trickle down economics" of the Regan era. Clinton also had the balls to enact "government furlows", literally shutting down "non-vitale" parts of the government at the end of the year, to keep the having to borrow money.

I remember how rough it was in the early ninties. I also remember how the lean times were responsible for creating the boom times that kicked in in the mid nineties. No boom can last forever, but with the right president at the healm to manage things, the market wouldn't have crashed down anywhere near as hard like they did in 2001.