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Current $12.4 Trillion Debt Ceiling To Be Breached... In March
There is no stopping the debt juggernaut: according to Dow Jones the stop-gap increase to the debt ceiling which pushed it to $12.4 trillion from $12.1 Tr, will last only through March. And even if Democrats pass their much maligned $1.9 trillion hike in the total debt to $14.3 trillion, it would only last through early 2011. There is no politically correct way to describe the shitshow America's economy has become.
The $1.9 trillion U.S. debt ceiling increase proposed in the U.S. Senate likely would cover the country's spending into
early 2011, an Obama administration source said Friday.
The increase would bring the U.S. debt ceiling tp $14.3 trillion. The U.S. statutory debt limit currently stands at $12.394 trillion while the public debt subject to that limit is at $12.271 trillion.
The source said the U.S. likely won't reach its current debt limit until March.- Dow Jones
We wonder, how many people on the populist totem pole will Obama have to sacrifice to achieve this goal? And of those, how many were critical to getting America to the point where every dollar of additional budget deficit has to be financed with about $2 dollars of incremental debt.
Interestingly, Congress is realizing the bind it is in, and ahead of the quarterly refunding on February 3 by the Treasury, it released a discussion agenda for a January 28 meeting with primary dealers. As Market News reports:
The Treasury is asking dealers to discuss the impact of fails charges, which have been in place for nearly nine months, on Treasury repo and cash market functioning.
The source noted that Treasury is "pleased" with the drop in fails. "A lot of the problems in the repo markets have cleaned up," he said.
The Treasury is also asking dealers to comment on the market impact of the end of agency mortgage-backed securities and agency debt by the Federal Reserve, which is expected by the end of the first quarter.
"Going forward, what impact, if any, will this have on fixed income markets, and financial markets more broadly," the Treasury asked primary dealers.
Gee, we wonder what PD's will say about the end of MBS monetization. Prepare for Q.E. 2 which is now certainly just around the corner. Dollar shorting time may very well be at hand once again.
Obama's presidency is shaping up to be the biggest disaster in America's history.
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"Obama's presidency is shaping up to be the biggest disaster in America's history."
Biggest disaster so far.
Leave yourself some wiggle room for the future.
His presidency is destined to be at least the second to the worst this century, so far.
Your second didn't crash society, just seriously screwed it up for society. Sorry, but the next crash of the magnitude of this one , or more likely, a greater crash than this one, will probably be the penultimate one. Your first, is actually the second.
Inflation and deflation are always monetary decisions. The water level on any body of water floats all boats (liquidity).
We are living the proof, the market dump is all about the expectation of future liquidity through quantitative easing - Bernanke would print, Volker might not. In addition, the bankers are mad, and they have tanked the market in the past (by restricting loans, decreasing margin available).
Right now: Gold, Silver, Oil, Treasuries, and Dollar (uup) are all down at the same time. In this environment, there is no safe haven.
In this environment, there is no safe haven.
Exactly as designed.
Something like this perhaps?
http://www.wallstreetfollies.com/2002/Hindenberg.gif
Yes, the liquidity gorilla is back. Also, the screaming and yelling by the banks will cause the White House to back off over the next few months.
"Obama's presidency is shaping up to be the biggest disaster in America's history. "
You think a McCain presidency would be any different?
Perhaps less active due to naps.
I keed I keed.
Let the petty partisan sniping begin!
Oh, wait -- Zro already beat us to the punch.
Hey, Zro. I want you to re-read Tyler's post again and find the reference to John McCain. See it? Neither do I.
Take some aspirin, have a nice Epsom salt bath, and try to chill your retarded little knee-jerk partisan jets.
I don't read this blog for my fill of political hatred. I can go to HuffPo or Drudge for that. I was simply asking if the alternative would have been any different. Obviously, we will never know but I put the likeliness of a stimulus package and a bank bailout as high under any party's leader.
Ad Hominem attacks for the win!
If only another Bush were in office, Tyler would not need to ridicule Obama.
It's really not fair. Taking our proudest moment of electing a black man to presidency and messing it up like this. We should have gotten Jeb Bush.
"Taking our proudest moment of electing a black man to presidency" WTF? what happened to the whole "judge by the content of the character " deal? I love it when folks try to fight bigotry with bigotry!
yes, yes.. of course you didn't meant it like that. In which case, you shouldn't have said it like that. oh, and he speaks so well!!
Nope sorry meant it. Everybody who doesn't like racism was very proud. I felt it they dealt it.
I'm a firm believer that you can find something wrong in anything but I think you're pushing it just a bit there. A little bit to thin to be stretching on that string.
I will grant that there was a potential PR benefit to showing the world we could elect a black man as president, but to say I was 'proud' about putting yet another big-government stooge in office, is a little much. (Yes McCain would have been about as bad.)
I was pretty sensitive during that time compared to how completely locked and loaded I am right now. That was some good energy but it lasted what 3 days? A really heavy milestone but relatively meaningless compared to the rest of the garbage.
Speaking of Obama's. The misses is asking people for 10 bucks for Haiti. Must urgently need to raid a slush fund. IMF must be having trouble billing them for relief supplies at 30 percent interest or something.
"Taking our proudest moment of electing a black man to presidency" WTF? what happened to the whole "judge by the content of the character " deal? I love it when folks try to fight bigotry with bigotry!
yes, yes.. of course you didn't meant it like that. In which case, you shouldn't have said it like that. oh, and he speaks so well!!
Next time, let's elect a black president who doesn't hate capitalism and wealth.
Be nice.
A Democratic congress and Republican president would not have been anywhere nearly as fiscally irresponsible as the current Utopian fantasy.
The last time we had a similar split we got set up for the current mess. The fact remains that both political parties believe that deficits don't matter and that the TBTF institutions are more important to our national defense than the Department of Defense is.
Having power split between both parties makes it very difficult for a single party to run "open loop".
With exceptions, among them that any action relating to financial services has always been open loop in the final analysis.
Only if the Judicial branch doesn't enforce the "Debt Ceiling."
+11
The older I get, the more I realize how sympatico the two parties are.
Here! Here!
Agree with you Miles, potétoes-potatoes.
Of course not. Just like the Reagan years, or Bush 2007/08. Could never happen. Wait, when did that TARP stupidity happen? Oh yeah, right.
Not like I voted for Obama either. It's just a good time to remember that you're choosing between Jack Johnson and John Jackson. Don't blink or you'll forget what each one supposedly stands for.
Speaking of:
http://www.youtube.com/watch?v=GjiBL8Kq9mg
A question I debate weekly. I have come to the conclusion that it was a lose/lose election. What would have happened if McCain had been elected? Lets discuss...
Bomb, bomb, bomb, bomb, bomb Iran. That would have meant WWIII (However there is currently a financial war being fought by GS and Asia. One that we could call WWIII. GS is a rogue and is taking on all comers, including Americans, who do not know there is a war on). He would have sent as many troops to the AF/Pak and he would have sat on Iraq's face as Obama has done. This not to mention he would have bailed out the banks, for sure. The difference? Americans would have not stood for it. We would have been in the streets protesting. With Obama, the status quo remains "hopeful" and confused.
"Hope is the most negative word in the metaphysical dictionary. It means something is going to happen without action being taken." Celente
Doesn't matter. He lost. Get over it. Your guy won, and he is clearly in way, way over his head. If Obama had gone to Citigroup or Goldman with his thin resume last year, do you think they would have given him a place at the executive table? Really? No way. He would have been made a branch manager in Toledo. He has no experience running a huge corporation, which is what the executive branch of the US government is. He got in based on smoke and mirrors. He was deemed the best man for the job, so now that he is failing to deliver, the recriminations will be vicious.
In reality, both parties ran their least best candidates, because everyone knew that this term, no matter who held the job, would be a meat grinder, and the POTUS would be destroyed politically. Obama was the sacrifical lamb who was tossed to the wolves to protect the real Democratic party powers, and he was sold to the gullible electorate as the not-Bush. Now that the really inconvenient truths are coming out about how slimy the DC and Wall Streeters are, he looks like a sixth-grader taking a college entrance exam, desparate for any way out. His biggest challenge in 2012 will not be the Republicans. It will be Ms. Hillary, ala the Kennedy-Carter dust-up of 1980. Only this time there is no dead secretary in a submerged convertible to derail the challenger.
nice analysis.
Really what can you expect from a nation of debt junkies? We won't get "clean" until our dealers cut us off. Most dealers will cut us off but the Fed, who of course will cut the drugs with rat poison. So unless we get a miracle man in the Fed we'll just debt up till the dollar eventually melts under the unholy gaze of infinite debt.
"gaze of infinite debt."
I have gazed into infinite debt once, it was a mortgage for a new home.
"gaze of infinite debt."
I have gazed into infinite debt once, it was a mortgage for a new home.
06/05/1987, 1 month cd: 6.85%
06/05/1987, 10 yr UST: 8.58%
National Debt 12/1987: $ 2,431,715,000,000
National Debt today: $ 12,344,000,000,000
Debt junkies is right. Many seem to be okay with usury and bankruptcy. Its a crime for savers to be getting so little on cash. Greenie and the Beard are the enablers.
Why didn't the USD skyrocket on this news? I mean, there will be so much more of them for us to love.
http://www.wallstats.com/deathandtaxes/ <-- is cool.
You'll need to delete the spaces for that link to work. Sadly, it seems to add spaces to the end of any fixed link I post.
The link worked for me.
Doesn't work for me. But I think I picked up spooks on my internet. I'm getting a bunch of snooping from everything from chinese to emirites to all the Non bank south american routed corporate and "alleged" college designations.
Time to turn my family into a corporation, where at least we have a chance on getting noticed.
Why do they call it a ceiling?
Should the Judges be called on to enforce it?
It's like the alarm on your alarm clock. The original intent was to tell us when it's time to wake the fuck up. Congress has been hitting the snooze button for the last two decades, and the current Congress is apparently trying to unplug the alarm clock entirely.
+1
As analogies go, that was a work of art.
+1
I know one thing that would be different. McCain certainly would not have signed a $787 billion stimulus bill.
But that is not the point. We are in the middle of a balance sheet depression triggered by excessive debt at all levels: consumer, business, government. It does not matter who is in officer per se to fix this---it will take time.
That said, President Soetoro has exacerbated the problem by turning on the printing presses and by expanding government. That is not the solution.
Does that indicate a willingness to follow the previous uni-party administrations and congress with privatizing Fannie & Freddie, passing one of the biggest corporate welfare bills of all time (MEDICARE Part D) while telling the nation deficits don't matter?
Why? Does your logic tell you a Repub doesn't do bailouts? Bush did, twice (TARP 1/TARP 2)! Barry/Jon/George/Bill/Magog/Ronnie one in the same. same family, same rules. All puppets of sorts, all have a little power. H.W. is the main "thinker" but dude is dumb as dirt too, just like Barry, just like Dubya, Clinton did NAFTA WTO. They bend over and take orders. Stupid is as stupid does, and all they do is stupid. stupids.
Stupid do do dumb - Mac Dre
Sorry I call BS on that one! McCain made an ass of himself trying to steal the biggest bailout spotlight!
Ceiling? ok, so hype to commence in 3..2..1. Hype, kinda sounds like herp. "Man I just got the hype."-'Merica. "Me too!"-China.
Pullback till March, hyperinflation to follow. This is what they want by the way! The corperations want to bleed the treasury because while they will not have the wealth and power they had before the greatest depression, they will have more power than the 'merican sheepole.
Debt's going parabolic. If they get $1.9 trillion though this year (which won't be easy by any means), how much will they need next year?
The center cannot hold.
Sometimes crazy-ass Denninger sounds crazy-ass. But on some things he's dead-on.
No Bernanke, no QE2. The "gentle, mild mannered professor from Pinceton" is the one and only printing machine...unless of course Greenspan got his old job back.
Bring on Volcker.
It doesn't matter we are past the apex. There is $28 trill waiting to be put into M2, which is up 18% YoY '08 and '09. If Volker raised rates 2% every Fed meeting all year he would still be behind the curve. Unless he raised it 10% at once, the DoeLarr has no shot. G's up hoes down (Gold up Dollar down).
I'm not following. Where does your $28 Trillion number come from?
*Using Fractional reserve lending multiples.
Then I guess we can "thank" all the big banks for clamping down on all consumer and small business lending. "We had to destroy the economy in order to save it" or something like that.
David Rockefeller has "Order by Chaos" tattood on the inside of his thigh.
What is the result for the Fed's nominal rate from the Taylor Rule? With unemployment up, positive GDP due to government spending, and inflation apparently tame, then the Taylor rule implies that the Fed rate should be low.
Apparently? Start with the -4% deflation from March last year. Now they tell us it is around 0%. that is a 4% gain. these are the Governmet's stats too! John Williams has it moving towards 10% btw, and I like that guy!
In case anyone was wondering, raising the debt ceiling by that much will place it very, very close to surpassing the GDP (100%). In other words, we owe as much as our country produces on an annual basis
Meh. All we have to do is go 1 year without consuming ANYTHING, while producing the same GDP we otherwise produce, and we'll be right back to no debt. Easy schmeezy.
Or we could just devalue the dollar by 90%.
+!!
February 1st ;)
Meh. All we have to do is go 1 year without consuming ANYTHING, while producing the same GDP we otherwise produce, and we'll be right back to no debt. Easy schmeezy.
Or we could just devalue the dollar by 90%.
Those figures, as drastic as they seem, aren't as bad as they appear. Still bloody horrible, but doable.
Quick Opinion Poll:
Does the Fed Extend the MBS purchase plan or not and why?
-------
My answer is not extend. The Mass. election was the turning point to being more fiscally responsible and not destroy our dollar.
GNP is 14 trillion
debt is 12+ trillion?
So whats the problem?
nada
Relative speaking the US gov is in better shape IMO than most home owners.
you mean, they actually care about the statutory limits ?
that's one respected rules, that's good news isn't it ?
Let's not blame Obama OK? At least for all of this, because that is stupid beyond belief.
There's Hamilton, who didn't want a central bank
You can go to Andrew JAckson, who fracked us with the FED and shot down the bimetal standard
Roosevelt implemented Authoritarian rule and stole gold from people and started 2 front wars to jack up the new deal. Plus overnight inflation by doubling gold's worth.
Johnson and the welfare state and massive spending. Add Vietnam war to the kitty.
Nixon, to pay for war expansion and cutting off the gold standard
Reagan and his military spending insanity to bankrupt the USSR
Bush, Clinton for excessive inflationary years-and letting Greenspan back in and Clinton for signing the international banking treaty which killed Glass-Steagalls
Bush2 for icing the cake with deregulation, braintrust demolition and adding 2 wars to the bill
Obama for handing decisions to the established financial kleptocrats
Obama is a callow, on-the-job-trained President. He has zero bureaucratic experience and told Geithner to "handle" the economy. Well, that didn't work. Now WHAT?
Just buy Gold on the dip. At some point I believe a debt for equity swap is the answer. Then we will own ourselves!