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$1.9 Trillion In Renovations To The GSE-Bloated US Debt Ceiling On Deck
You didn't think all those massive stock market gains would come free of charge? The cost: about $1.9 trillion in new debt allowance according to Steny Hoyer, almost $500 billion higher than previous estimates by Senate Budget Committee Chairman Kent Conrad. It took a mere 4 days for Conrad's optimistic estimate of the future cost of today's carefree living to go up by 30%. And who will bear the brunt of this ludicrous leverage: the U.S. soldier. Dow Jones reports that the debt ceiling increase provision will be added to legislation setting forth the Pentagon's budget for 2010. "It is unconscionable for the Democratic majority to pile the debt limit increase on the backs of the American soldier." In ironic retrospect, it will not be so "unconscionable" when the same soldier is sent for some preliminary diligence work west of the Pacific, just in case America's partner in the most crucial prisoners' dilemma game of all time, China, decides to finally defect, and tell the Fed it can monetize its own debt without Beijing's cooption. But that's a topic for late 2010/early 2011.
More from Dow Jones:
According to Treasury estimates, the current debt ceiling is expected to be reached soon. The federal budget deficit in fiscal 2009 was $1.4 trillion and, through the first two months of this year, is on course to be even higher.
According to the figure made public by Majority Leader Steny Hoyer (D., Md.) Friday, the move would hike the government's ability to borrow to between $13.9 trillion to $14 trillion.
Increasing the debt ceiling itself is largely symbolic as the public debt is the accumulation of past deficits, or money already spent.
But were the U.S. to breach its debt limit, it would default on its obligations, potentially lose its prized top-shelf credit rating and have to pay significantly higher interest to its creditors. Such a scenario, albeit an extremely unlikely one, would have tremendous ramifications for the wider financial markets.
And just to make it very clear who is betting the house that China will forever keep buying US Bills at 0% in perpertuity (good luck with the 30 Years), "Reps. Steve Scalise (R., La.) and Kevin Brady (R., Texas) introduced legislation Friday that would require a stand-alone vote on any incrase in the debt ceiling."
The bill would require a House vote of a two-thirds majority in to hike the debt ceiling. While it is almost certain not to become law given the size of the Democratic majority in the House, it is the latest salvo from Republicans who are hoping to tap into growing public angst about the state of the country's finances.
As of last count, the total debt outstanding was at $12.08 trillion (with a marginal cushion as Marla had disclosed previously). Yet with the two most recent Treasury auctions still to close, keep a close eye on this number. The Treasury Secretary and the Senate are both playing far too close to the vest with something which, even if a pure technicality, will force the rating agencies to find the US in default, as much as they would hate to do so.
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...and gold continues to get pounded
Never underestimate the sneakiness of CongressCritters. Only this time they've miscalculated. Their thinking is that tucking this away in the Pentagon budget will jam it right through . And the timing is perfect.....when the sheeple have sugar plums dancing in their heads.
Now if they can get the 2010 Bond market to ignore this little piece of statutory window dressing, they'll be home free come next November.
NOT !!
Keep drinking.....you are almost sober.
Does anybody with half a brain think that the US can repay all that money?? I mean seriously, how dumb can they be? Get your money out before they devalue the dollar to repay the debt with 1/3 less dollars. What a bunch fking bozos
No doubt. But it might take a while to get there, and anything you think is a safe alternative will be manipulated like crazy, and you could get hurt there. The only really smart thing to do, is seek the Lord with all your heart, and lay up your treasure in heaven.
Good Luck with that.
No.
Never underestimate the stupidity of those dollarbugs. Seriously, the dollar has been losing buying power on such a long-term scale that it only has the value of about 4 cents since the Federal Reserve Note (dollar) came into being during the early 1900s. In 2009 alone it has lost approximately 10%, yet still those dollarbugs keep buying bonds and other garbage.
Meanwhile goldbugs went from $35/oz to $1110/oz.
This isn't about repaying the money. It's all about shifting the blame to the next administration.
No, the US gov will never make all the debt good (except by trashing the dollar.) But that isn't really the point. The point is, who's first in line to get repaid, then who's second, and etc. The guy who's first in line will have no worries. Ditto the second. And so on. It's the fools at the end of the line who have the problem.
China is pretty sure they'll be at the front of the line, to be made whole. Probably so. Same for Japan. The heavy hitters.
But lemme see, I wonder who that poor peon is, standing at the end of the line.
It makes my blood boil that these democrats are attaching this to the defense bill. I cannot believe I ever voted for them.
They spent the money and should be adult enough to vote the debt increase and not force everyone to "vote for our soldiers" in a naked attempt to make it bipartisan while wrapping themselves in the flag(IE US SOLDIER).
Now if anyone dare vote against this fiscal insanity they will be voting against the troops!
This truly makes me sick.
Yes, it's thoroughly disgusting.
http://www.iamsorryivotedforobama.com/
Yes I agree, largely symbolic AT THIS POINT.
FWIW I'm learning how to reload my used brass.
Dillon press my friend! And reloading is a must if you plan on shooting much, though be warned it's hard to get primers now. My old man just bought a bunch but had to pay a premium for them.
Though it's also hard to buy ammo still as well. Go figure in the middle of an economic crisis and they can't keep ammo on the shelves.
These are hostile waters.
We have reached the point where the appearance of action can no longer conceal consequence.
However events unfold, we are increasingly risking the stability of our entire system to perpetuate the poor behavior of the few.
And it is through such maligned and self-depreciating actions that they themselves sew the seeds of their own destruction.
OT: Does anyone have info on this article by the European Union Times?
Obama Orders 1 Million US Troops to Prepare for Civil Warhttp://www.eutimes.net/2009/11/obama-orders-1-million-us-troops-to-prepa...
"Russian Military Analysts are reporting to Prime Minister Putin that US President Barack Obama has issued orders ..."
First sentence. You can stop right there.
I'm wondering if this EUTimes is the National Enquirer equivalent in Europe?
Obama comments in 2006. Apparently he feels differently now?
Sen. Barack Obama [D-IL]: Mr. President, I rise today to talk about America's debt problem.
The fact that we are here today to debate raising America's debt limit is a sign of leadership failure. It is a sign that the U.S. Government can't pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government's reckless fiscal policies.
Over the past 5 years, our federal debt has increased by $3.5 trillion to $8.6 trillion. That is "trillion" with a "T." That is money that we have borrowed from the Social Security trust fund, borrowed from China and Japan, borrowed from American taxpayers. And over the next 5 years, between now and 2011, the President's budget will increase the debt by almost another $3.5 trillion.
Numbers that large are sometimes hard to understand. Some people may wonder why they matter. Here is why: This year, the Federal Government will spend $220 billion on interest. That is more money to pay interest on our national debt than we'll spend on Medicaid and the State Children's Health Insurance Program. That is more money to pay interest on our debt this year than we will spend on education, homeland security, transportation, and veterans benefits combined. It is more money in one year than we are likely to spend to rebuild the devastated gulf coast in a way that honors the best of America.
And the cost of our debt is one of the fastest growing expenses in the Federal budget. This rising debt is a hidden domestic enemy, robbing our cities and States of critical investments in infrastructure like bridges, ports, and levees; robbing our families and our children of critical investments in education and health care reform; robbing our seniors of the retirement and health security they have counted on.
Every dollar we pay in interest is a dollar that is not going to investment in America's priorities. Instead, interest payments are a significant tax on all Americans--a debt tax that Washington doesn't want to talk about. If Washington were serious about honest tax relief in this country, we would see an effort to reduce our national debt by returning to responsible fiscal policies.
But we are not doing that. Despite repeated efforts by Senators CONRAD and FEINGOLD, the Senate continues to reject a return to the commonsense Pay-go rules that used to apply. Previously, Pay-go rules applied both to increases in mandatory spending and to tax cuts. The Senate had to abide by the commonsense budgeting principle of balancing expenses and revenues. Unfortunately, the principle was abandoned, and now the demands of budget discipline apply only to spending.
As a result, tax breaks have not been paid for by reductions in Federal spending, and thus the only way to pay for them has been to increase our deficit to historically high levels and borrow more and more money. Now we have to pay for those tax breaks plus the cost of borrowing for them. Instead of reducing the deficit, as some people claimed, the fiscal policies of this administration and its allies in Congress will add more than $600 million in debt for each of the next 5 years. That is why I will once again cosponsor the Pay-go amendment and continue to hope that my colleagues will return to a smart rule that has worked in the past and can work again.
Our debt also matters internationally. My friend, the ranking member of the Senate Budget Committee, likes to remind us that it took 42 Presidents 224 years to run up only $1 trillion of foreign-held debt. This administration did more than that in just 5 years. Now, there is nothing wrong with borrowing from foreign countries. But we must remember that the more we depend on foreign nations to lend us money, the more our economic security is tied to the whims of foreign leaders whose interests might not be aligned with ours.
Increasing America's debt weakens us domestically and internationally. Leadership means that "the buck stops here." Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better.
I therefore intend to oppose the effort to increase America's debt limit.
When Bush came into office, the National Debt stood at 5 trillion USD. He promptly doubled that amount in eight years. Where was Republican's indignation during that time? Besides incurring insurmountable debt, he bloated the size of Government, involved us in 2 unending expensive wars, increased entitlements, and cut taxes primarily for the wealthy---leaving behind a ruined economy. Now everyone is concerned about debt ceilings? Now we are questioning the cost of war? Where was your voice when it really mattered? Your hypocrisy is shameful.
Most of here are well aware of the failings of the Bush years, and you'd be hard pressed to find many that would defend that record. Obama and his change crowd are dancing to the same song, however, and it's getting old. Meet the new boss, same as the old boss.
+1
You are correct. It comes down to a 2 party system that is broken. They are the same crooks. It is now time for the Dems to pillage the country (taxpayers). Old George and co. had 8 years of it. Now its there turn.
If you really want to fix the system vote for term limits and publicly financed campaigns with no private money involved. Outlaw lobbyists. This is a rigged game with the money whores in Washington. They do not give a shit what they are doing to us drones.
CONSERVATIVES did not speak up and criticize him for it. I know I did. Republicans did not. Big difference!
Spare us the lecture, sport - there's plenty of hypocrisy to go around. After all, the same people who called George Bush's FY 2003 budget deficit (inflated by the collapse of dot-com and 9/11) of about 465B "reckless" among other things are now in charge and claiming that deficits 3-times that size - and growing - might not be "big enough".
Bush, Hastert and Frist (etc.), for all their legion faults, were spending pikers in comparison with the current crowd.
So yeah, like I said, plenty of hypocrisy to go around.
Check out this movie showing the major foreign holders of treasury securities from 2002 to the present!
http://computationallegalstudies.com/2009/12/11/who-owns-americas-debt-a...
People don't get elected by telling the truth.
Buy your gold and silver now before the public catches on to what is happening with the dollar. One or two major players say "no - we dont want any more of your treasuries, we've already lost enough". Thats all it takes. a few words out of the wrong mouth. In half an hour, there will be such a scramble out of the dollar, the markets will all be halted.
China or Japan are the obvious ones, but it could also be any of the OPEC countries. Russia and Brazil also hold large amounts of treasuries.
Ive never been a goldbug in my life, but im not stupid either. Its plain to see whats happening to the dollar given the course were on.
By the way,any word on a conclusion on the Japanese duo trying to smuggle the TBs into Swizerland?