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How Much Is A Trillion? - Crash Course Chapter 12

So big, humans really can't grasp it
Friday, September 5, 2014, 10:45 AM

Chapter 12 of the Crash Course is now publicly available and ready for watching below.

One trillion is a big number. In this short video, we try to help you get a sense for just how big; but the reality is simply that the human brain can't really suitably comprehend magnitudes this large.

Which is why we should be concerned that the US' money supply has ballooned to over $12 trillion dollars over the past decade. And that its outstanding debts and liabilities are many multiples that amount.

We are living in an era where our leaders are making decisions at orders of magnitude that they simply can’t truly understand. And many politicians have less expertise in math, economics or business than most of you reading this. When they vote for the next trillion-dollar bailout, raise the debt level by another trillion, or pressure the Federal Reserve for another trillion-dollar stimulus program – they don’t have any real sense of what the implications will be. No one can.

We have reached the point where we’re operating in territory beyond our neural programming.

As a result, unintended consequences to our current policies are guaranteed. 

For the best viewing experience, watch the above video in hi-definition (HD) and in expanded screen mode

Coming next Friday: Chapter 13: Debt

For those who simply don't want to wait until the end of the year to view the entire new series, you can indulge your binge-watching craving by enrolling to PeakProsperity.com. The entire full new series, all 27 chapters of it, is available -- now-- to our enrolled users.

The full suite of chapters in this new Crash Course series can be found at www.peakprosperity.com/crashcourse

And for those who have yet to view it, be sure to watch the 'Accelerated' Crash Course -- the under-1-hour condensation of the new 4.5-hour series. It's a great vehicle for introducing new eyes to this material.

Transcript: 

During the Crash Course you will often encounter numbers that are expressed in trillions. How much is a trillion?

You know what? I’m not really sure myself.

A trillion is a very, very big number, and I think it would be worth spending a couple of minutes trying to get our arms around the concept.

First, a numerical review.

A thousand is a one with three zeros after it.

A million is a thousand times bigger than that and it’s a one with six zeros after it.

At this level I can really get my mind around the difference between these two numbers. A million dollars in the bank is a very different concept from a thousand dollars in the bank.

I get that.

A billion then is a thousand times bigger than a million, and it’s a one followed by 9 zeros.

And a trillion is a thousand times bigger than that, and it’s a one followed by 12 zeros.

So a trillion is a thousand billions, which means it is a million millions.

You know what? I don’t know what that means!

I can’t visualize that, so let’s take a different tack on this.

Suppose I gave you a thousand dollar bill and said you and a friend had to spend it all in a single evening out on the town. You’d have a pretty good time.

Now suppose you had a stack of thousand dollar bills that was four inches in height. If you did, you know what? Congratulations, you’d be a millionaire.

Now suppose you wanted to enter the super-elite of the wealthy and have a billion dollars. How tall of a stack of thousand dollar bills would that be?

The answer is a stack 358 feet high, seen here reaching 50 feet higher than the Statue of Liberty.

Now how about a stack of thousand dollar bills to equal a trillion dollars? How tall would that stack be? Think of an answer.

Well, that stack would be 67.9 miles high.

And I meant stack, not laid end to end or anything cheesy like that. A solid stack of thousand dollar bills, 67.9 miles high. Now that’s a trillion dollars.

That still doesn’t do it for you?

Okay, I want you to imagine that you’re in a car on a roadway that is lined at the side with a sideways stack of thousand dollar bills.

A nice, compact, rectangular column of thousand dollar bills is snaking along the roadside next to you as you drive.

You drive along -- brrrrrrrrrrrrr -- without stopping for a little more than an hour, and the entire way there’s that stack of thousand dollar bills right next you, on the side of the road, the whole way.

Said another way, the amount of money created in the past year in the US economic system, if it had been printed up as thousand dollar bills and stacked along the side of the road, would stretch from the center of Manhattan to Trenton, New Jersey

So there it is. Either you can visualize the stack better by driving along next to it, or by standing on top if it, or any other way you wish to express this statement.

But make no mistake, a trillion is a very, very big number and we should not be lulled into complacency simply because it is too big to really get our minds around. Instead, we should be very nervous that our money supply now stands at – not 1 – but 12 trillions of dollars.

And the total accumulated debts and liabilities of the US are several times greater than that!

We are living in an era where our leaders are making decisions at orders of magnitude that they simply can’t truly understand.

And many politicians have less expertise in math, economics or business than most people watching this video.

When they vote for the next trillion-dollar bailout, raise the debt level by another trillion, or pressure the Federal Reserve for another trillion-dollar stimulus program – they don’t have any real sense of what the implications will be. No one can.

We have reached the point where we’re operating in territory beyond our neural programming.

As a result, unintended consequences to our current policies are guaranteed. We need to be ready for that.

Oh, and if you think wrapping your brain around the concept of a trillion is hard, let’s turn to Japan for a moment.

In August of 2013, Japan’s national debt exceeded 1 quadrillion yen for the first time.

How much is a quadrillion? Well, if we swapped out the $1,000 bills we’ve been using with 1,000-Yen notes, the stack would wrap around the Earth almost 3 times.

Ok, let’s move on to the next chapter. My brain hurts.

Please join me for our next chapter, a very important one, on Debt.

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10 Comments

davefairtex's picture
davefairtex
Status: Diamond Member (Online)
Joined: Sep 3 2008
Posts: 5072
awesome short

Even if you already know that a trillion is a really big number, you should still watch this one.  :-)

Wildlife Tracker's picture
Wildlife Tracker
Status: Gold Member (Offline)
Joined: Jan 14 2012
Posts: 403
Demonocracy Derivative Exposure Infographic

Demonocracy does a great job visualizing a trillion dollars as well. Below is one of my favorite graphics from this full infographic http://demonocracy.info/infographics/usa/derivatives/bank_exposure.html

9 Biggest Banks' Derivative Exposure - 228.72 Trillion

Note the little man standing in front of white house. The little worm next to lastfootball field is a truck with $2 billion dollars. 

There is no government in the world that has this kind of money. This is roughly 3 times the entire world economy. The unregulated market presents a massive financial risk. The corruption and immorality of the banks makes the situation worse. 



If you don't want to bank with these banks, but want to have access to free ATM's anywhere-- most Credit Unions in USA are in the CO-OP ATM network, where all ATM's are free to any COOP CU member and most support depositing checks. The Credit Unions are like banks, but invest all their profits to give members lower rates and better service. They don't have shareholders to worry about or have derivatives to purchase and sell. 



Keep an eye out in the news for "derivative crisis", as the crisis is inevitable with current falling value of most real assets. 

Derivative Data Source: ZeroHedge

climber99's picture
climber99
Status: Silver Member (Offline)
Joined: Mar 12 2013
Posts: 176
NATO countries spend $1 trillion per year

NATO countries spend $1 trillion per year on "defense".  What a great use of money and  resources !  We are truly an intelligent species !  I suppose this will come in useful in the coming resource wars that are gathering pace at the moment. <sarc>

Ed

SPAM_Matthew Blain's picture
SPAM_Matthew Blain
Status: Member (Offline)
Joined: Oct 24 2010
Posts: 14
Who demonstrates Limits To Growth?

Hi All, just a couple of general questions...

 

Is there a politician or political party that publicly discusses Limits To Growth? (And finite resources and all that). Somewhere, anywhere in the world? After my Al Bartlett lightening-bolt moment nearly 10 years ago, I thought (for want of a better term) a few grass roots might have established by now.

 

I'm keen to leave the closet, so to speak.

 

Regards,

Matt Blain

Melbourne, Australia

ezlxq1949's picture
ezlxq1949
Status: Silver Member (Offline)
Joined: Apr 29 2009
Posts: 175
An MP who accepts Limits to Growth

Kelvin Thompson, Federal Member for Wills.

http://www.kelvinthomson.com.au/

He visited Canberra a year or two ago and drew a large audience. Not large enough but it was great to see and hear a FEDERAL member who has his head screwed on straight.

Arthur Robey's picture
Arthur Robey
Status: Diamond Member (Offline)
Joined: Feb 4 2010
Posts: 3936
Hard Choices.

When I look at that pile of money paper I think to myself "You know, what could be the harm of letting some naked kid in Bangladesh or Africa have just one piece of paper?"

Aside from the nostril-flaring outrage of sanctimonious Calvinists at unearned wealth, there is the issue of survival. Is the  survival of said kid desirable? There are 9 billion of us now. (Give or take a couple of hundred million).

Those who protest that the naked kid has less economic impact than their own little darlings had better sit back on their heels a little and think about the moral implications of that utterance.

Hard choices, indeed.

climber99's picture
climber99
Status: Silver Member (Offline)
Joined: Mar 12 2013
Posts: 176
Derivatives real money?

Your 228.72 Trillion of derivative "money" that you mention are just ones and zeros in some computer memory somewhere. They can be deleted at any time.  It is a good illustration of how far removed from reality much of our financial system is and mustn't be confused with real physical assets.  Keeping our real physical assets and trying to steal other Nation's assets is why we spend $1 trillion per year on NATO "defense". Survival of the strongest - it drives our quest for "growth". 

Ed

Wildlife Tracker's picture
Wildlife Tracker
Status: Gold Member (Offline)
Joined: Jan 14 2012
Posts: 403
Climber

Only a small fraction of dollars are actually printed. Technically 99%+ of the currency could probably be deleted at any moment. The problem is somebody has a legal claim on those ones and zeros, and the removal of those numbers would be a death-spiral to the financial system.

Arthur, There is certainly enough paper to go around. Everybody in the world could grab a fat stack. Not so true with this stuff...

climber99's picture
climber99
Status: Silver Member (Offline)
Joined: Mar 12 2013
Posts: 176
Derivatives would cancel themselves out in a crash.

The thing about derivatives is that there roughly the same amount of "money" in short positions as long. Most if it would cancel itself out in the event of a crash.  In any case money systems can be replaced with other ones when they die because they are purely a  human construct.  Real wealth is physical assets that are acquired initially by war,  legitimized in law and then controlled by the army, politicians and media on your payroll.

Ed

Bankers Slave's picture
Bankers Slave
Status: Platinum Member (Offline)
Joined: Jul 26 2012
Posts: 520
Persistent if nothing else.

 

Bodies Incorporated As Collateral For The Credit Of A Nation

Our birth certificates are bonds floated on the money markets and worth unlimited amounts of credit to the nation state. 

Every newborn child when bonded in this manner becomes the future repayment collateral for the credit that was just raised in its name. 

Check out the name on all you govt documentation. All caps letters indicates a body incorporated, not a man or a woman but now a legal entity called a person.

Now go to any cemetery and check out how the names on the tombstones are formed...in all capital letters. Here lies the body incorporated, a dead entity. We were only living men and women for the moments that existed prior to BC bonding into servitude.

And that is where all the obligatory debt promissory note paper originates! Sinister eh!

 

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