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Fed Preparing For US Default Says Plosser

Tyler Durden's picture




 

That giant whooshing, and humming, sound you hear are all the printers at the basement of Marriner Eccles getting refills and start the warm up process. Because according to the Fed Charles Plosser the Federal Reserve is actively preparing for the possibility that the United States could default. Which can only mean one thing: an immediate paradrop of millions of $100 bricks to every man woman and child in the US since as we all know by know Tim Geithner has repeatedly confirmed the Treasury has absolutely no default plans. None.

Per Reuters:

Philadelphia Federal Reserve Bank President Charles Plosser said the Fed has for the past few months been working closely with Treasury, ironing out what to do if the world's biggest economy runs out of cash on August 2.

"We are in contingency planning mode," Plosser told Reuters in an interview at the regional central bank's headquarters in Philadelphia. "We are all engaged ... It's a very active process."

Plosser said his "gut feeling" was that President Barack Obama and Congress will come to an agreement to increase the Treasury's borrowing authority in time to avert a default on government obligations.

And in addition to the warming up, the Fed is also engaging in the following:

The Fed effectively acts as the Treasury's bank -- it clears the government's checks to everyone from social security recipients to government workers.

"We are developing processes and procedures by which the Treasury communicates to us what we are going to do," Plosser said, adding that the task was manageable. "How the Fed is going to go about clearing government checks. Which ones are going to be good? Which ones are not going to be good?"

"There are a lot of people working on what we would do and how we would do it," he said.

Plosser added that there are difficult questions that the Fed itself had to grapple with.

The Fed lends to banks at the discount window against good collateral. But what happens if U.S. Treasuries no longer fit that bill?

"Do we treat them as if they didn't default, in which case we would be saying we are pretending it never happened? Or do we treat them as if they defaulted and don't lend against them?" Plosser said. "Those are more policy questions."s at the basement of Marriner Eccles getting refills and start the warm up process.

We urge the secretary of tax evasion to take a hint or two from his "Treasury Bank" brethren and start contemplating a Plan B since we now stand less than 48 hours away from D-Hour and there is still no consensus.

 

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Wed, 07/20/2011 - 16:24 | 1475022 slow_roast
slow_roast's picture

Are all my gold stocks going to go to infinity? 

Wed, 07/20/2011 - 16:25 | 1475029 Clueless Economist
Clueless Economist's picture

I advoke LOWERING the debt ceiling to 14 trillion.  But then agaib I got my economics degree from ITT Tech

Wed, 07/20/2011 - 16:31 | 1475066 SparkySC
SparkySC's picture

First Major Country to DEFAULT WINS!


 Think of the monster bets Govt's are making.

Wed, 07/20/2011 - 16:45 | 1475111 InconvenientCou...
InconvenientCounterParty's picture

The gov't that borrows the most wins. Defaulting at this point in the game is pernicious nonsense.

QE3 is the Fed buying defaulted Treasuries and backstopping $20T in derivatives? mmm, sounds like they don't have a parachute or a helicopter.

Let's roll out the analysis of who voted for which debt increase and see who the heros and saboteurs are, shall we?

 

Thu, 07/21/2011 - 03:06 | 1475181 Quixotic_Not
Quixotic_Not's picture

Bureaucrats and politicians have an extremely limited playbook consisting of taxation, regulation, and inflation.

These three ugly sisters of bureaucracy effectively serve to steal from people, make things more difficult for them, and rob them of their purchasing power… and yet they’re dressed up as solutions instead of problems.

Regardless of the scenario, Congress will reach deep into this playbook until they chase away every productive citizen and company they can…

In fact, it’s already happening.

Wed, 07/20/2011 - 17:55 | 1475190 Quixotic_Not
Quixotic_Not's picture

Another PIMCO short on the U.S. Economy:

http://www.pimco.com/EN/Insights/Pages/Are-There-Any-Rungs-Left-on-the-H...

Are There Any Rungs Left
on the Housing Ladder?

  • It appears that limited mortgage availability and vulnerable consumer health are restraining demand.
  • Also weighing on the market is regulatory uncertainty over the future structure of mortgage finance and the resolution of foreclosure overhang.
  • We believe the housing market, considered to be a key driver of the economic recovery, will generally remain weak for the foreseeable future.
Though much has been made of the distressed supply overhang, we believe the demand side of the housing equation could more than overwhelm the impact of distressed housing supply. Absent a significant economic rebound or more dramatic policy response, housing demand will likely remain a drag on the housing market for the foreseeable future.
No housing recovery, no wage inflation = Zero, Zip, Zilch, -0- recovery. Good luck 'MeriKa, cause you're terminally ill... Here's one psychopathic parasite (aka Jimbo da RealTard) trying to spin this info, so he can continue flipping homes to suckers:
He ignores the fact that tough underwriting today has much to do with the lenders’ paranoia about buying back mortgages from Fannie/Freddie.  As we transition to private lending, the underwriting will make more sense.  You can already get a seven-year interest-only mortgage in the mid-4% range up to $2,000,000 with 20% down payment (and up to $1,000,000 with 15% down).
http://www.bubbleinfo.com/2011/07/20/housing-demand
Wed, 07/20/2011 - 18:46 | 1475482 Doña K
Doña K's picture

If fed and treasury start handing out Paulson style money, bet on Apple, Gold and Silver.

I just told my 15 year old daughter about this possibility and the next thing was:

"Can I have an ipad?"

Wed, 07/20/2011 - 21:11 | 1475786 Tunga
Tunga's picture

NO gas grill for you! 

Wed, 07/20/2011 - 21:41 | 1475858 darkstar7646
darkstar7646's picture

Only if you're outside the United States.

Three-fifths of all Apple sales are now foreign, and the other two parts of that triumverate WILL be confiscated fairly soon into the scenario.

Wed, 07/20/2011 - 17:47 | 1475281 Sudden Debt
Sudden Debt's picture

The Fed lends to banks at the discount window against good collateral.

ha... haha... HA... HAHAHA.... WHOEHAHAHAHAHAHAHA!

Like they ever cared about "good collateral"!

They lend to every Obama contributor because it's the patriotic thing to do.

2011 IS THE LAST YEAR OF THE UNITED STATES OF AMERICA!! ALL HEIL TO THE UNITED STATES OF JP MORGAN!

BY 2012 YOU'RE ALL TRESPASSING PRIVATE PROPERTY!!

2012 = YEAR 1

Better make it as pleasant as possible and you'all should hold hands, sing KumBahJah while you'll all be deported to Mexico or to the saltmines.

 

Wed, 07/20/2011 - 18:02 | 1475362 Sathington Willougby
Sathington Willougby's picture

At least a few around here can contribute by airbrushing Dr Paul's face out of pictures and such.

Maybe even a handful are literate enough to work in the Ministry of Bloginess revisionist tweeting dept.

Thu, 07/21/2011 - 01:13 | 1476225 Oh regional Indian
Oh regional Indian's picture

SW, that is some awesome irony! Ministry of Bloginess Re-tweeter!

ORI

Wed, 07/20/2011 - 18:12 | 1475394 Ghordius
Ghordius's picture

You mean All heil to the Holy Squid Empire!

Wed, 07/20/2011 - 21:43 | 1475868 darkstar7646
darkstar7646's picture

Why junk that? He's pretty close to correct.

How do you get out of this year or next without basically either repudiating the debt ceiling entirely, nationalizing The Second American Civil War (which has already started in some cities), and/or the dollar loses reserve status once and for all?

Thu, 07/21/2011 - 04:18 | 1476298 Havana White
Havana White's picture

Which cities?

Thu, 07/21/2011 - 00:37 | 1476193 CompassionateFascist
CompassionateFascist's picture

Not me. My silver in a JPM vault. Obviously the safest place for it. Just call me evil.

Wed, 07/20/2011 - 21:34 | 1475836 cara leaf
cara leaf's picture

 

EMAIL ADDRESSES OF CONGRESS & SENATORS (it’s 545 against 300,000,000—that’s million)

http://carolelieffthecuriouscapitalist.co

There are 545 of them against 300,000,000 of us!!!!   What is the problem? Of twenty-seven Constitutional Amendments, seven took under year to become law.  If you agree with this thesis, send our diatribe to twenty people. It’s more fun than Amway.  In three days most of America will have read it.

The 28th Amendment: 2012 Congressional and Senatorial Reform Act:

1. No Tenure. No Pension: Congressmen and Senators collect salaries while in office. That’s it. They do not receive pay, pensions, benefits or any other perquisites upon completion of their service.

2. The Congress and Senate will participate in Social Security. There will be no retirement entitlement programs legislated by themselves, for themselves.  Their retirement programs will be identical to those of the people who elected them. This will be retroactive. Congressional and Senate Retirement Funds will immediately transfer to the Social Security system; this effective upon the date of passage of this bill.

3. Congress and the Senate will not vote themselves pay raises. They are elected public servants, not kings and queens. Congressional and Senatorial pay hereafter follows the lower of either CPI, or 3%.

5. From date of passage forward, Congress and the Senate have the same health care options as those who elected them. Us. They’re our elected public servants, not kings and queens.

6. Congress will abide by the same rules and laws it imposes upon those who elected them. They are expressly forbidden to take cut-rate mortgages from Countrywide, Fremont, Goldman Sachs, Bank of America or Citigroup.

7. All past and present contracts with Congressmen and Senators are void as of January 1, 2012.

We, the people, ratified none of this. We had no representation to this flagrant flouting of The Constitution. We did not cast votes on politicians’ perquisites. We did not vote for eternal pensions of our other state and local public servants. Congressional and Senatorial service is an honor, not a career. Our Founding Fathers, envisioning citizen legislators who, upon serving their terms, returned to their families, went back to work and became citizens again. They would turn in their graves.

2012 Voters Bill of Rights and Responsibilities:

1-If you can’t read, you can’t be informed, therefore you can’t vote responsibly.  You are unqualified to make decisions that affect millions of others.  You are unqualified to choose who is most qualified to run our country.  I will not turn my country over to you.

2- Public assistance is not a lifestyle. No one stays on public assistance for more than two years. While on public assistance, you surrender the right to vote.  Without being vested financially in the public good, you have no ‘skin in the game.’  You are in survival mode, one where it is impossible to make impartial decisions about the public good.  Over 50% of Americans do not pay taxes.  It is unconscionable to let those on public assistance vote that those who are not, must support them.  (This does not apply to Veterans.)

3- You forfeit public assistance if you are so irresponsible that you continue to bear children you cannot afford to raise. You surrender public assistance if you bear more than one child you cannot afford. Both men and women are subject to this.  We did not agree, nor will we agree, to be responsible for paying the costs of raising children you cannot afford.  That’s your responsibility.  Not ours. The Fourteenth Amendment was not intended to allow children, born of illegal immigrants, citizenship.  You receive no benefits whatsoever if you are in this country illegally.  Every effort will be made to deport. It is far less expensive to deport than to support millions of families for one or two generations.

Diane Arbus, Crying Child

3. The intent of the Fourteenth Amendment was not to grant wholesale citizenship to the offspring of any immigrant who decides to come into our country illegally. You receive no benefits whatsoever, ever. You forfeit opportunity for future citizenship and/or naturalization. We refuse to sanction or protect those who flouts our laws. Every effort will be made to deport.  It is far less expensive to deport than to support millions of families for one or two generations.

Okay,  time for some fun!

And now!  Playing at a Theatre near YOU!  More fun than a barrel of monkeys, able to leap tall buildings in a single bound!  It’s truth, justice, and….

“Giant Political Email Links”   (see their great 007 website)*Send emails to every loudmouth talk show host in the world in one fell swoop!*Write Letters (full of propaganda) To The Editor of national newspapers (let’s just see how they like it) also in one fell swoop!*Let Hollywood & TV producers know exactly how you feel about all those crappy shows that cause brain cancer in miceall in one fell swoop!  Bill Owens, Suburbia

 

Get faxes & phones of all 545 U.S. Congressmen & Senators!  FOR FREE! Don’t sit around on weekends watching your kids get obese watching Resident Evil on the computer all day, make it a family affair! Let them join the party!  (Tell them it’s even better than Slaughterhouse!) We can annoy them even more than they can annoy us!  (No, not the children…the politicians.)The odds are on our side! BECAUSE IT’S 545 POLITICIANS vs. 300 MILLION TAXPAYING  (well, half of them anyway) CITIZENS…and if you still can’t figure it out for yourself, believe me, the odds could be a lot worse .
Here’s how you play.  Just follow the simple rules and in no time you’ll be having more fun than a barrel of monkeys!   It’s fun, it’s free and it’s All-American!  It might even get your kids out of their Bowling for Columbine clothes!  Just click on the name & VOILA!  It’s like Paris!Connect to congressmen’s and senators’ websites and fill out the message forms! Don’t forget to demand a reply. Include your address. Use our fax list with your modem or printer then paint the town RED… fax them all at once.  If you get in trouble, we’ll bail you out of jail! We’re here to help!  And our customer support actually speaks English!  The most effective way to contact these morons is by filling out their website message forms. Select a Congressman or Senator. Click. Send message!  But you’ll probably have to drive all the way to the actual Conservative Caucus because the links didn’t work here last time I tried!  And for those of you in the bleeding hearts crowd, forget the old line about conservatives against liberals…everything’s changed!  Now it’s US against THEM!

USER INSTRUCTIONS:
1-           Write ONE letter (and try to spell everything right)

2-           Cut & Paste this in every website form

;3-           Click.  Send! That’s all there is to it!  Soon you’ll have Pen Pals all over Washington, DC!   Send that letter to every one you can.

HELPFUL TIPS:

4-          Use their personal website forms (below; click on link; if it doesn’t work, go to our website; we promise, it won’t kill you. Not doing it will) or;

5-          Fax your letter but;

6-          Don’t use mail. They’re still looking for anthrax. You’ll be dead before security clears your stupid letter.

Send as many letters–to as many of them–as you can. Tell your friends you do not discuss the state of our country unless they have proof they’ve written at least one letter. We must do this.  Sociopaths are very intuitive.  They know there’s no political will when you won’t EVEN WRITE THEM A SINGLE LETTER!!  What would YOU THINK IF YOU WERE THEM?  You’d print some money, break out the Dom, invite some strippers and throw a big party! They think we’re just a bunch of p***sies.   And wearing you jaw out in Starbucks & sports bars is useless. If you have time to do that, you have time for the letter. A recent survey found politicians know if they don’t get letters they can control their victims even more!  It means WE ALL FEEL PARALYZED & think it’s NO USE!  There’s no reason for them to act in our interest. It’s the same thing that happened in Nazi Germany when the  oppressed were brainwashed into thinking they had no power. But they weren’t helpless at first.  Part of what killed them was waiting too long. And you, sir, are delusional if you think it can’t happen here.

William Eggleston, The Guide.

Wed, 07/20/2011 - 23:10 | 1476063 ebworthen
ebworthen's picture

 

I like it, but this will never happen until select members of CONgress are hung from the Capitol Dome and the blood of patriots is spilled on the Capitol Steps.

 

Thu, 07/21/2011 - 02:30 | 1476260 Hook Line and S...
Hook Line and Sphincter's picture

Ebworthen,

It's becoming quite clear that COG is in effect. Has been for the past 10 years, but under the cover of half-smiles and soft hands. Watch, within the next year or two, you'll see the fraud that appears to be a functioning Congress brushed aside like the false vision it is, and replaced quite visibly by something that has no resemblance to a patriot.

Authoritarianism stringing us up hook line and sphincter 

Thu, 07/21/2011 - 00:14 | 1476154 Accidental Farmer
Accidental Farmer's picture

For this to work, there would have to be a constitution and a republic in place....but there isn't. The government is a corporation, and we are all employees of that corporation. You have just as good a chance of going in to where you work, and telling your boss to vote himself a pay and benefits cut.

Thu, 07/21/2011 - 00:30 | 1476182 Freddie
Freddie's picture

300 million are not paying taxes.  Probably closer to 40 million.  The rest enjoy the Hope & Change goodies.   The sheep watch TV and it is ALL the same - praise dear leader.

Thu, 07/21/2011 - 04:58 | 1476310 Havana White
Havana White's picture

cara leaf:  Sandbox is thataway.

 

Wed, 07/20/2011 - 23:19 | 1476076 Tangurena
Tangurena's picture

Somehow, I think we can make a boardgame out of this. Start with Risk or Diplomacy, a pile of Monopoly money, some cards like UNO and the spinner from Nuclear War. I can imagine it now, play some "bet the country" or "too big to fail" card (like the 100MT bomb), get triple yield on the spinner and the whole world explodes!

http://boardgamegeek.com/image/154770/nuclear-war

Wed, 07/20/2011 - 16:36 | 1475082 cossack55
cossack55's picture

With that degree you are overly qualified for SecTres.  If you can prove you have "cheated" on your taxes you can have the job for life.

Wed, 07/20/2011 - 16:52 | 1475145 dlmaniac
dlmaniac's picture

<Warning: rant ahead />

It's like one guy farts, and it stinks. The next guy says he's more decent than that b/c he pulls down his pants first then he farts. What's the difference? It stinks just as much.

As for this "Fed working closely with Treasury" blah blah blah, we know they are running covert bailout, QE and guarantee 24/7. So what's the difference whether they reveal it or not?

Wed, 07/20/2011 - 18:12 | 1475385 Troublehoff
Troublehoff's picture

Can I just compliment you on the correct use of your tag there.. with a slash at the end making it an open & close tag

 

..not like you'd use if closing off a rant

 

cheers for your strict adherence to ZHML

Wed, 07/20/2011 - 20:58 | 1475768 WmMcK
WmMcK's picture

You get junks for this?

What's the gripe, ZHML instead of X(A)ML?

Technical grammar nazis?

Wed, 07/20/2011 - 22:26 | 1475955 bigkahuna
bigkahuna's picture

just humbugs.

Wed, 07/20/2011 - 18:52 | 1475498 Doña K
Doña K's picture

If treasury wants velocity, they should hand out money to the people as the article is saying. That will have a better effect on GDP and other economy metrics.

Thu, 07/21/2011 - 01:16 | 1476228 Oh regional Indian
Oh regional Indian's picture

Velocity is the key. It could have been done in so many creative, main street positive ways, long ago.

Clearly the health of main street is not on the agenda. keeping main street alive is. barely at that.

Stimulous, it's really for the top of the pyramid. only.

ORI

http://aadivaahan.wordpress.com/2010/07/24/value-vs-price/

Thu, 07/21/2011 - 02:33 | 1476265 Hook Line and S...
Hook Line and Sphincter's picture

their covert bailout can be yours too if you act now

AU isn't just for breakfast anymore.

Wed, 07/20/2011 - 20:25 | 1475715 IQ 145
IQ 145's picture

 "advoke"--to choke while eating an advocado. possibly.

Wed, 07/20/2011 - 21:05 | 1475776 francis_sawyer
francis_sawyer's picture

But then agaib I got my economics degree from ITT Tech

...in your PAJAMAS, no doubt!

Thu, 07/21/2011 - 00:02 | 1476130 Widowmaker
Widowmaker's picture

C'mon, even ITT Tech grads are getting robbed while ITT Tech sucks the giant government sponsored debt-for-education-for-political-pandering mammary gland in the sky.

Wed, 07/20/2011 - 16:27 | 1475043 nope-1004
nope-1004's picture

Plan B?  From an inbred fascist?

Nice try.  Geithner is complicit in the wealth transfer crime being played out before our very eyes.

Wisdom and intellect are two different things.  Those with wisdom usually carry a few morals around too.  Timmy may be smart, but he's an idiot.

 

Wed, 07/20/2011 - 16:46 | 1475123 sasebo
sasebo's picture

Might I add pompous, pretentious asshole?

Wed, 07/20/2011 - 16:53 | 1475151 TruthInSunshine
TruthInSunshine's picture

Default would be the greatest advent in American History since 1776, and mark a rebirth of the nation.

But it's not enough.

Each head of the Hydra that is the Central Bank must be lopped off with a razor sharp blade, and a Constitutional Amendment must be enacted returning the coinage of money (not Federal Reserve Notes, as it won't exist any longer, but Greenbacks) to the Congress, never to be delegated again.

Finally, a simple yet concrete Balanced Budget Amendment must be put into place, whereby the U.S. Government may not spend a single penny more than the revenue it receives, over any time horizon that exceeds on fiscal year.

We also need to, as a nation, completely kill the idea that any institution is "too big to fail."

Bring back fiscal constraint, kill the Fed and its gross distortion of markets and 'crack dealing whoredom' ways, let Wall Street and banks know that they will live and die by purely by their own decisions...

...and gut the 50% of government that is useless, dead weight on productive Americans, and institute a flat tax not to exceed 12% in total.

 

Quite a wish list? Yes.

Do these things, and America will be unstoppable with a growing, thriving middle class once again.

 

Wed, 07/20/2011 - 16:59 | 1475183 HellFish
HellFish's picture

TruthInSun,

I think I love you!

Wed, 07/20/2011 - 22:23 | 1475949 Remo Williams
Remo Williams's picture

So what are you so afraid.

Afraid that you're unsure of,

a love there is no cure for?

Thu, 07/21/2011 - 00:13 | 1476151 Lonewar
Lonewar's picture

Remo,

 

You got it wrong, Its, "A love there is no Cure for?" =) And where the hell are you when this country really needs you, Chuin, and Smith...

Thu, 07/21/2011 - 00:44 | 1476200 rambo1028
rambo1028's picture

+1

Wed, 07/20/2011 - 17:04 | 1475200 tsx500
Wed, 07/20/2011 - 17:11 | 1475224 tip e. canoe
tip e. canoe's picture

as Mr.LH said last night, Stop Making Sense

http://www.youtube.com/watch?v=Cqg_ZGcuybs

Wed, 07/20/2011 - 21:37 | 1475848 Lee Marvin
Lee Marvin's picture

Thank you. Probably one of my favorites and best version! 

Wed, 07/20/2011 - 17:26 | 1475268 XPolemic
XPolemic's picture

Finally, a simple yet concrete Balanced Budget Amendment must be put into place, whereby the U.S. Government may not spend a single penny more than the revenue it receives, over any time horizon that exceeds on fiscal year.

I think that is a dangerous thing to wish for. Taxes could go to 110% of income under that plan.

Wed, 07/20/2011 - 17:45 | 1475320 TruthInSunshine
TruthInSunshine's picture

And voters would know and retaliate in kind.

Ask George H.W. Bush (and that was nowhere approaching 110%).

Wed, 07/20/2011 - 21:35 | 1475843 Man Bear Pig
Man Bear Pig's picture

Taxes could go to 110% of income under that plan

Care to share how/where you came up with 110? I smell troll...

Wed, 07/20/2011 - 22:43 | 1475994 Yen Cross
Yen Cross's picture

  The libtard thinks he talking  GDP! Ignorance at it's best!  The kicker is, I could see that being spun... nice work M/B/P... +1

Wed, 07/20/2011 - 18:00 | 1475360 Captain Kurtz
Captain Kurtz's picture

Throw in a non-essential consumption tax, whereby individuals with higher spending pay more since they use more of society (externalities, human resources, environment etc. etc.) and i'm sold.

Wed, 07/20/2011 - 18:04 | 1475366 Captain Kurtz
Captain Kurtz's picture

note this would not apply to businesses or the middle class buying groceries, only to those who choose to buy an exotic sportscar...annually.

Wed, 07/20/2011 - 18:05 | 1475368 TruthInSunshine
TruthInSunshine's picture

Can't do it because it is a complication that starts us down the road again to carve outs, exemptions, and other taxation complications that are crushing the economy right now.

The tax code is 60,000+ pages.

Let's keep the tax return postcard size always, with nothing more than a number multiplied by a % and a result, that takes 3 seconds or less to compute, period.

Same rules for all, across the board, no exceptions.

Wed, 07/20/2011 - 23:27 | 1476091 lincolnsteffens
lincolnsteffens's picture

+60,000

Thu, 07/21/2011 - 02:32 | 1476263 StychoKiller
StychoKiller's picture

Get rid of automatic withholding, and you might have a deal there.

Wed, 07/20/2011 - 18:02 | 1475363 Shell Game
Shell Game's picture

Very nice list.  Might I add another ammendment wish to the list?

'Congress shall enact a One Subject at a Time clause such that each and every bill brought shall address a single issue and not word more.'

Wed, 07/20/2011 - 18:44 | 1475476 zuuuueri
zuuuueri's picture

or, better, add the requirement that any bill be read aloud, in full, in the house or senate before it can be voted on.  Give each member of the house or senate the ability to claim he didn't hear it read clearly and make the reader repeat something. 60,000 pages? knock yourself out, guys, you will be there for five years just reading the bill.

it's all just a wishful dream, though. even if they had such a law, the first and last time it would be applied would be in voting themselves a way to get around it ;)

 

 

Wed, 07/20/2011 - 23:28 | 1476093 lincolnsteffens
lincolnsteffens's picture

++60,000

Wed, 07/20/2011 - 18:15 | 1475404 camoes
camoes's picture

The chinese overlords won't let US default...they will keep US afloat until they buy up the most productive farmland, real assets and technology that they are interested, only when they strip it out it may happen, but by then US dollar will be used to light up heating because Nat Gas will be 200 USD...

Wed, 07/20/2011 - 19:27 | 1475587 Tuco Benedicto ...
Tuco Benedicto Pacifico Juan Maria Ramirez's picture

Very thought provoking and a real possibility in my humble gunslinger opinion.

 

Tuco Benedicto Pacifico Juan Maria Ramirez

Wed, 07/20/2011 - 20:55 | 1475764 Guy Fawkes Mulder
Guy Fawkes Mulder's picture

"China Begs U.S. to Save the Dollar"

http://rt.com/usa/news/china-us-debt-credit

Wed, 07/20/2011 - 21:32 | 1475832 knowless
knowless's picture

you are correct, however the hicks and rednecks will have the last say i think... land title doesn't mean much when the populace is uncontrollable.

Wed, 07/20/2011 - 21:43 | 1475865 camoes
camoes's picture

They don't need to own land, just the grain elevators, banks, silos, Monsanto and Caterpillar...that's how they do it in Brazil, doesn't matter if you have the land if you don't have the genetically enhanced seeds and special low interest rate financing (which you will definetly need in a double digit per month interest rate).

And hicks and rednecks still will want to make a living and will rather export food to get paid good money.

Thu, 07/21/2011 - 00:26 | 1476173 camoes
camoes's picture

so...who junked me? chinese govt official? u mad because I revealed your plans? herro?

Thu, 07/21/2011 - 00:26 | 1476174 camoes
camoes's picture

so...who junked me? chinese govt official? u mad because I revealed your plans? herro?

Wed, 07/20/2011 - 18:47 | 1475488 Milestones
Milestones's picture

--"never to be delegated again"

 

by Milestones 
on Sun, 11/21/2010 - 14:22
#

 

Mr. T., I addressed this issue a couple of times "The Trials and Tribulations of the Federal Reserve Act of 1913" on 6-15-10 and a couple of times later. In fine, let me answer you in brief.

My argument lies in Article 1, Section 8 (5)-Powers of Congress. The Congress SHALL have power: to coin money, REGULATE THE VALUE THEREOF,--". That power was apparently DELEGATED to the Federal Reserve Bank. That DELEGATION of authority to the Federal Reserve is my question. Did Congress have the authority to delegate that authority to "regulate the value thereof"?

Panama Refining Co. v Ryan 293 U.S. 388 1935

"The Constitution provides 'that all legislative powers herein GRANTED SHALL be vested in the Congress of the United States, which shall consist Senate and House of Representatives.'--The Congress MANIFESTLY IS NOT PERMITTED to abdicate or to TRANSFER TO OTHERS the essential legislative functions with which it is vested.---Cannot be allowed  to obscure the limitations of the authority to delegate, if our constitutional system is to be maintained."

Field v Clark 143 U.S. 649 1892

--"The legislative power must REMAIN in the organ where it is lodged by that instrument."

Sovereignty is granted to "We the People" in the first 3 words of the Preamble. As such, under the Constitution, we the people delegate our Sovereign authority to persons to REPRESENT us in day to day dealings. But it is the reserve of the Soverigns to delegate authority not our reperesentatives. John Locke came to the same conclusion.

I would contend that the Federal Reserve Act of 1913 is illegal under the Constitution. Further, if we consider Marbury v Madison of 1803, a decision has stood for over 200 years, the case can be stated in far starker terms:

Marbury v Madison 17 Wall 205 Cranch 2 1803

"Thus the particular phraseology of the Constitution of the United States confirms and strengthens the principal, supposedly to be essential to all written constitutions, that a law repugnant to the constitution is VOID; and the courts AS WELL AS ALL OTHER DEPARTMENTS ARE BOUND BY THAT INSTRUMENT."

Not only did Congress not have the authority to submit such a document as the Federal Reserve Act of 1913; likewise President Wilson had no authority to sign it. See the last sentence of the above.

Yes, I know, the Constitution has been turned into a roll of toilet paper to the 1%ers but that is still the document I still march to as do most others . If that not be the case then we would be far better served now to be comparing an AR-15 to an AK-47.

If those unhappy with the way things are want a change, we must state our concerns and grievances in a fashion that those who are totally uninformed can have a place, a handle so that a nightmare of a 2nd revolution can be avoided. 

Rots of Ruck!!      Milestones

Wed, 07/20/2011 - 18:53 | 1475503 Milestones
Milestones's picture

Computer misplaced  this response to Truthin Sunshine @ 16:53 @ 1475151 above    Milestones

Wed, 07/20/2011 - 20:02 | 1475670 tip e. canoe
tip e. canoe's picture

rood ruff milestones

Wed, 07/20/2011 - 23:05 | 1476052 snowball777
snowball777's picture

You seem to have glossed over a little detail that established precedent in 1819...

The Government of the Union, though limited in its powers, is supreme within its sphere of action, and its laws, when made in pursuance of the Constitution, form the supreme law of the land.


There is nothing in the Constitution of the United States similar to the Articles of Confederation, which exclude incidental or implied powers.

 

If the end be legitimate, and within the scope of the Constitution, all the means which are appropriate, which are plainly adapted to that end, and which are not prohibited, may constitutionally be employed to carry it into effect.


The power of establishing a corporation is not a distinct sovereign power or end of Government, but only the means of carrying into effect other powers which are sovereign. Whenever it becomes an appropriate means of exercising any of the powers given by the Constitution to the Government of the Union, it may be exercised by that Government.


If a certain means to carry into effect of any of the powers expressly given by the Constitution to the Government of the Union be an appropriate measure, not prohibited by the Constitution, the degree of its necessity is a question of legislative discretion, not of judicial cognizance.

 

...something about Maryland trying to rid itself of the 2nd Bank of the US with taxation.

 

Wed, 07/20/2011 - 19:02 | 1475524 chistletoe
chistletoe's picture

"Do these things, and America will be unstoppable with a growing, thriving middle class once again."

 

Do those things, and the world still reached peak oil and peak food in 2005,

and worldwide economies and populations will still continue their inexorable decline.

Sorry about that.  Honesty and itegrity are nice things, but they don't solve everybody's wish list for xmas ....

Thu, 07/21/2011 - 02:10 | 1476253 The Architect
The Architect's picture

+1

Thu, 07/21/2011 - 02:12 | 1476254 The Architect
The Architect's picture

Dup

Thu, 07/21/2011 - 02:53 | 1476276 John_Coltrane
John_Coltrane's picture

Breaking chemical bonds isn't the only source of energy.  Fission for now, fusion for later (or just use the sun-the source of the chemical bonds in the first place)

Wed, 07/20/2011 - 19:24 | 1475579 Tuco Benedicto ...
Tuco Benedicto Pacifico Juan Maria Ramirez's picture

No need for amendments.  Just kill the Fed and Central Banking and max bank fractionalization to 10:1.  Reinstitute greenbacks.  No longer would the issuance of new currency concurrently be the issuance of new debt owed to a privately held demon banking cartel.

 

Tuco Benedicto Pacifico Juan Maria Ramirez

Wed, 07/20/2011 - 19:47 | 1475631 gall batter
gall batter's picture

uh, i think we need more than a new tax code, taking down the fed, a balanced budget, etc.  we've dumped too much oil into the gulf of mexico and sealed that deal with corexit.  there's a huge oil spill off the coast of china.  add the nuclear waste that's landing on lettuce leaves in california and oregon from fuku with nuclear waste pouring in to the pacific, and more, more, including wars that pollute with depleted uranium and white phos.  hard to believe that a nip n tuck of our financial situ-, including liposuction of the gurgling lard within the beltway, lopping off the too bigs, or anything will halt the juggernaut.   

Wed, 07/20/2011 - 19:49 | 1475638 gall batter
gall batter's picture

supposed to be a response to #1475151, truth in sunshine.

Wed, 07/20/2011 - 21:38 | 1475853 Things that go bump
Things that go bump's picture

Yes, there isn't much we can do about the looming mass extinctions (including a good probability of our own), but we can certainly rearrange the deck chairs to make ourselves more comfortable while we wait. Perhaps we should take the advice of the poem inscribed on the walls of an eqyptian tomb.

 

 

"Spend the day merrily!

Put ointment and fine oil to your nostrils

And lotus flowers on the body

of your beloved....

Spend the day merrily

And weary not therein,

Lo, none can take his goods with him.

Lo, none that has departed can return again."

(4000 year old Egyptian)

 

 

 

Wed, 07/20/2011 - 23:04 | 1476050 Calmyourself
Calmyourself's picture

 When you throw in white phosphorus you lose all credibility.. You know they used blister agents in WWI and submarines in the revolutionary war and do you have any idea how big the oceans are and stop the mongering of all types..  Relax..  The financial problems are big enough..

Wed, 07/20/2011 - 20:15 | 1475696 Rodent Freikorps
Rodent Freikorps's picture

Ya know,

according to mythology, for each head of the hydra you cut off, it grows two more.

Just sayin...

Wed, 07/20/2011 - 22:44 | 1475995 Yen Cross
Yen Cross's picture

  Hola! Yen.

Thu, 07/21/2011 - 02:41 | 1476271 Hook Line and S...
Hook Line and Sphincter's picture

I bet John Bobbit wished he was a hydra.

Wed, 07/20/2011 - 20:55 | 1475757 uniman
uniman's picture

The single biggest problem with the USG, IMHO, is that it has escaped from its 10th Amendment chains.  It then bypassed the States and went directly to dealing with we-the-people.  The best way to get the USG back into its cage is to simply prohibit/prevent it from dealing with ordinary people on a day-to-day basis.  Imagine all your present dealings with the USG being transferred back to the individual States.

Ideally, we-the-people should spend our political effort dealing with one layer of government.  The individual States work well enough and are reasonably responsive to the will of the people.  In today's world we have to deal with the City, the County, the State, and the USG.  That's simply too much. The USG was created for the convenience of the States and it should be returned to that role.  The States can decide if they need a mechanism for resolving disputes between them, dealing with national defense, or other issues that may be on an interstate scale.  If that's what the States decide then they can choose to feed the USG (or not).

The USG also presents a TBTF problem.  There is a natural tendency to build over arching structures on top of whatever we work with.  Villages coalesce into nation States, nation States create larger entities such as the US and EU.  And now the process continues towards the UN.  Each of these ever larger structures present more complexity, more dis-economies of scale, and more concentration of power.  They are ever further removed from accountability to we-the-people.  When and if the human race ever ventures into space for real, will that model continue?  I shudder the day when we have to kiss ass to the City, the State, the United States, the United Nations, the Inner Planets Confederation, the Solar Agglomeration, and the Federation of Planets.

Anybody who believes this model is good should continue pushing for its logical results.  Are we going to eventually "vote" for World Senators and Presidents and politicians?  Are we supposed to pay a World income tax?  Is Uncle Terra going to pay all the impoverished billions of the Earth a pension and give them free health insurance?  Will I need a building permit from the UN?  Are we supposed to accept some hybrid political system whereby we simply do not have any power any more?  How do my rights to bear arms and free speech fit into political compromise with some of the more benighted regions of this planet?

As we see now, this is a failed nightmare.  The mistakes made (and crimes committed) on this scale become too big to fail.  So we-the-people simply loose control.  Can we do nothing other than stand and watch as the world burns?  Perhaps it's time to learn and accept that human space is simply bigger and more complex than anything we can ever build to contain it.  Despite the warts on that model, the alternative is much, much worse.

grandfubar.com

Wed, 07/20/2011 - 21:08 | 1475780 New World Chaos
New World Chaos's picture

Another amendment:  The Commerce Clause is revoked and all laws based on it become null and void.  Say goodbye to subsidies, the drug war, and most of the vast regulatory bureaucracy.

Wed, 07/20/2011 - 21:13 | 1475789 francis_sawyer
francis_sawyer's picture

and gut the 50% of government that is useless, dead weight on productive Americans, and institute a flat tax not to exceed 12% in total...

@TIS

I'm going to tell you that I'm not opposed to anything you say... But be prepared... A great portion of what you'd cut out there are basically the "affirmative action" beneficiaries (which comprise a large part of the fat of the federal [& even state & local payrolls])...

Few of these peeps even have a clue as to how commerce works without Uncle Sugar...

Zip-a-dee-do-dah bitchez...

We're gunnin' for a major civil war sooner or later...

Wed, 07/20/2011 - 22:56 | 1476034 cranky-old-geezer
cranky-old-geezer's picture

... and a Constitutional Amendment must be enacted returning the coinage of money (not Federal Reserve Notes, as it won't exist any longer, but Greenbacks) to the Congress, never to be delegated again.

a) We don't need any amendment, it ALREADY SAYS gold & silver.

b) That DOESN'T mean paper currency, of ANY type. 

Thu, 07/21/2011 - 00:07 | 1476140 Widowmaker
Widowmaker's picture

Who knows how to spend your money better than the market's bullshit banking cartel.

Remember these guys only win, all one has to do is see how they got there.

Is Linda Green the modern Mudd?

Thu, 07/21/2011 - 00:50 | 1476206 CompassionateFascist
CompassionateFascist's picture

No, not hardly. Must also close the borders to stop inter-national flow of sweatshop labor - this to restore working class real demand - and terminate the "free trade" racket in order to reverse the hemorrhage of middle class jobs to foreign sweatshops. In other words, autarchy. And none of this will happen w/o Civil War II. Not "legislation". Civil War. Race vs. Race. States vs. Center. Rurals vs. Urbs. Coming soon, to a country near you.  

Wed, 07/20/2011 - 19:37 | 1475605 poor fella
poor fella's picture

If I could edit video, this would be Geithner and Molly Shannon REALLY LOVES the vibrations of the printing presses!

http://www.youtube.com/watch?v=r8Ps9310ih8

Wed, 07/20/2011 - 16:29 | 1475044 redpill
redpill's picture

OT, but it is rare to see such delicious ownage on the boob tube: http://www.realclearpolitics.com/video/2011/07/20/msnbc_to_gop_congressm...

Wed, 07/20/2011 - 16:39 | 1475092 cossack55
cossack55's picture

Classic.

Only would have been better if he would have responded "and a Doctorate in Common Fuckin' Sense, Bitch".

Wed, 07/20/2011 - 16:43 | 1475106 chumbawamba
chumbawamba's picture

God damn if that wasn't a bitch-slap heard round the world.

He should've followed up by asking Little Ms. Pretty if she had a journalism degree.

Then again, he has a degree in Keynesian economics, so the whole thing is merely relative.  He's still a douche, like the rest of his colleagues.

I am Chumbawamba.

Wed, 07/20/2011 - 18:15 | 1475401 Troublehoff
Troublehoff's picture

Hey Chamba,

Just wondering... what happened with all your credit cards?

did you tell the JPM to get fucked?

Wed, 07/20/2011 - 18:47 | 1475486 HungrySeagull
HungrySeagull's picture

Obama has people to fill the Beast and Air Force one. Credit Cards are for the little people.

Wed, 07/20/2011 - 19:17 | 1475559 Tuco Benedicto ...
Tuco Benedicto Pacifico Juan Maria Ramirez's picture

"Only the little people pay taxes." 

 

--Leona Helmsley a.k.a.  "the queen of mean"  (now pushing

   up wilted daisies and dandelions)

Wed, 07/20/2011 - 16:49 | 1475134 Pool Shark
Pool Shark's picture

 

OT or not; that's classic redpill,

Stickin' it to a vaccuous MSLSD talking head; revealing her for the ignorant idealogue that she is...

 

Wed, 07/20/2011 - 18:12 | 1475391 WonderDawg
WonderDawg's picture

Classic bitch slap. But I agree, he's still a douche.

Wed, 07/20/2011 - 18:23 | 1475429 camoes
camoes's picture

And a degree in economics doesn't mean much, in some cases could be even worse...but the bitch deserved to be asked if she had one...

Wed, 07/20/2011 - 19:14 | 1475551 Tuco Benedicto ...
Tuco Benedicto Pacifico Juan Maria Ramirez's picture

Congressman:  May I be so bold as to ask if "you" have a degree in economics young lady?

 

Interviewer:  No, I am sorry I don't happen to have a degree in economics but I give good head.  How do you think I got this assignment?

 

Congressman:  Fine.  Give me head till I'm dead.

 

Screen goes blank

Wed, 07/20/2011 - 22:55 | 1476032 PhattyBuoy
PhattyBuoy's picture

"May I be so bold as to ask if "you" have a degree in economics?"

 

No, but I stayed in a Holiday Inn Express last night ...


Thu, 07/21/2011 - 00:15 | 1476156 Widowmaker
Widowmaker's picture

You beat me to it:  

"No, but I just saved 15% on my auto insurance by switching to Gekko"

I might as well have a swoosh tatoo'd on my ass.

Wed, 07/20/2011 - 21:03 | 1475773 WonderDawg
WonderDawg's picture

That would definitely have made it epic.

I'm with you on the economics degree, though. I mean, Bernanke has one, too, right? Highest honors as well. The degree doesn't mean shit, if it isn't accompanied by a healthy dose of common sense and maybe some integrity.

Wed, 07/20/2011 - 16:46 | 1475118 Beam Me Up Scotty
Beam Me Up Scotty's picture

Nah, all its going to take is 2 ounces  of platinum (or maybe gold pressed latinum) to fix this problem.

[url]http://wallstreetpit.com/79740-is-coin-seignorage-obamas-magic-bullet[/url]

2 Trillion Dollar coins

Problem solved.

Wed, 07/20/2011 - 16:54 | 1475158 SMG
SMG's picture

So if this does happen, it's going to spike interest rates,  which short term will be good for the dollar and bad for PM's.

Interested in comments on that thought.

Wed, 07/20/2011 - 17:24 | 1475262 Whalley World
Whalley World's picture

Look at the 70's, interest rates climbed along side the rise in Gold and Silver.  Can't see a reasone why this would not happen again.  When faith in paper crumbles, even at higher rates, it will prove beneficial to real money.

Wed, 07/20/2011 - 19:08 | 1475535 Tuco Benedicto ...
Tuco Benedicto Pacifico Juan Maria Ramirez's picture

Agreed.  Look what happened to metals when Volker jacked up interest rates in early 80s.  However, we are entering unchartered territory.  I will hold the physical and you can buy the Greek two year notes at 32% interest.

Tuco

Wed, 07/20/2011 - 21:58 | 1475908 Man Bear Pig
Man Bear Pig's picture

it's only bad for PMs if you actually believe interest rates will come back down. if you were given the choice today to chose between $100,000 over 10 years at 20% interest or $100,000 in gold (REGARDLESS OF $/OZ!), which would you chose?

Wed, 07/20/2011 - 16:59 | 1475177 Long-John-Silver
Long-John-Silver's picture

To infinity and Beyond Bitchez!

Wed, 07/20/2011 - 17:42 | 1475305 LongBalls
LongBalls's picture

Your gold stocks will go to infinity but not because of a default. Not yet anway. Problem is, what will that paper buy you? When they go to infinity it will because complete trust in fiat is gone. Your stocks are valued in fiat. This is complete theater to scare people and push congress to do what they want. Which is to issue more debt. A U.S. default hurts the banks. They will not allow the U.S. to default untill they have the rights to all its national treasures (highways, ports, parks, power grid, etc.). Greece proved this. It's coming. But probably next year or 2013. IMHO anyway. None-the-less, the vice is about to get tighter on the American people.

Wed, 07/20/2011 - 18:29 | 1475447 camoes
camoes's picture

You will buy renmimbi, swiss francs, singapore dollars, brazilian reais...and/or they will reset and create a new currency pegged to another or god forbid, to gold.

Look up at the history of hyperinflation in other countries, they will probably first cut the zeroes at the US dollar in the beginning, call it something like the "New dollar", "Amero", "The Bernanke", take your pick.

Can you imagine buying your Ipad 5, just 2 billion bernankes, or finance it in 5 years at 250% per month??

 

Wed, 07/20/2011 - 17:53 | 1475339 geologyguy
geologyguy's picture

Slow Roast...you do understand that your gold stock certificates are just that...certificates.  Pieces of paper...so should Debtmaggeddon truly strike and sends this party spiraling out of control, you will have a bunch of paper.  It's not as though you can exchange those pieces of paper for gold, silver, food or some other desirable asset.
Bottom line is if push came to shove, you would own whatever assets you had under your control at our current point in time.  Have a house with a $300,000 note on it?  Grats, it is now your's free and clear.  Occupy an apartment complex...sorry, looks like you are SOL.  Got precious metals, guns, ammo and non-perishable foodstuffs?  Grats, you are ahead of the game.  Stuck holding a bunch of paper which says persons X, Y & Z owe you money?  Best of luck to you bucko.

Wed, 07/20/2011 - 18:27 | 1475442 cossack55
cossack55's picture

Nice. Very succinct. Bravo.

Wed, 07/20/2011 - 19:01 | 1475520 Tuco Benedicto ...
Tuco Benedicto Pacifico Juan Maria Ramirez's picture

Gold stocks increased by 400% during the Great Depression.  One needs the exchanges to be open and running, however.  Own the physical and maintain proper silver/gold/lead ratios.

 

Tuco Benedicto Pacifico Juan Maria Ramirez

Thu, 07/21/2011 - 03:26 | 1476286 Dre4dwolf
Dre4dwolf's picture

If it does go to infinity , chances are it would be no different than if it went to zero.

 

Well as far as what those infinity dollars would by you .

 

 

Wed, 07/20/2011 - 16:24 | 1475023 Careless Whisper
Careless Whisper's picture

Once again.... all they (Fed Cartel Banking) have to do is forgive the $1.5 Trillion in Treasury Bonds they own.

 

Wed, 07/20/2011 - 16:46 | 1475121 Cognitive Dissonance
Cognitive Dissonance's picture

All your defaulted Treasury Bonds are belong to us.

Wed, 07/20/2011 - 16:58 | 1475171 Sudden Debt
Sudden Debt's picture

I bet you'll get a few euro's for a million$ bond on Ebay.

Collectors... go figure...

 

Wed, 07/20/2011 - 17:22 | 1475254 Captain Planet
Captain Planet's picture

Ah, sell the USSA as collectors items, kinda like what we are doing with Greece. Should keep the lights on till the next election. 

I'll take Glacier National Park for some gold. 

Who wants the Florida Keys? 

Big Bend NP in Texas ain't bad either, plus you'll have a few agricultural experts to help you grow food. Though 90% of its volume has been consumed by Amairica, you still have a trickle of the Rio Grande in your backyard.

Wed, 07/20/2011 - 17:42 | 1475308 Sudden Debt
Sudden Debt's picture

I've got 4900 silver ounces which I will trade for Yellowstone park. ALL OF IT!

I'll also give you 30 ounces of gold for California if you get the trespassers out.

 

Wed, 07/20/2011 - 18:33 | 1475455 I Am The Unknow...
I Am The Unknown Comic's picture

Aha!  Now we know what you are really after: you just want to drive around on the freeways all by yourself.  Well, I got news for you SD, Meth Man isn't going to give up his convertible driving privilidges! 

Wed, 07/20/2011 - 18:58 | 1475515 Tuco Benedicto ...
Tuco Benedicto Pacifico Juan Maria Ramirez's picture

You would be overpaying for California!  Just buy the Baja Peninsula from Mexico for 2450 ounces of silver.  I understand all the Mexicans have moved North.

 

Tuco Benedicto Pacifico Juan Maria Ramirez

Thu, 07/21/2011 - 01:04 | 1476218 Motorhead
Motorhead's picture

Happy National Day to you.  I have some St.-Feuillien and some Chimay blue at the house.  I reckon I'll pop open a bottle or two this evening.

Wed, 07/20/2011 - 21:22 | 1475806 New World Chaos
New World Chaos's picture

Only place in America where peyote still grows wild.  I'll take it and kick out the cactus pigs.

Wed, 07/20/2011 - 17:01 | 1475193 Duuude
Duuude's picture

"The Fed lends to banks at the discount window against good collateral."

 

"Tha Fed eats their shareholders craaap"

 

There, fixed it fer ya.

 

Wed, 07/20/2011 - 17:46 | 1475322 LongBalls
LongBalls's picture

Exactly.....They created it out of thin air anyway. It's not like they slaved for it on a 105 degree day. It's nothing more than magic!

Wed, 07/20/2011 - 18:08 | 1475377 Freewheelin Franklin
Freewheelin Franklin's picture

In Soviet Russia, bonds own YOU!

Wed, 07/20/2011 - 16:24 | 1475024 Cleanclog
Cleanclog's picture

But (quiver) . . . didn't the ECB say it won't use monetary policy to "Finance" government debt?

Oh never mind - wrong Central Bank.

Wed, 07/20/2011 - 17:07 | 1475155 Ghordius
Ghordius's picture

FED Godzilla is way stonger than ECB King Kong.

The ceiling? A piece of paper... A small promise not to do as the last many times... A flicker of shame on a politician's face...

Wed, 07/20/2011 - 16:25 | 1475027 slow_roast
slow_roast's picture

It would be the ultimate FUCK YOU to China to default though right?  They'd be holding the bag on their USTs and then have a bunch of Euros, which would be so strong that the economies in Europe would entirely sieze up and be worthless as well. 

 

 

Wed, 07/20/2011 - 16:31 | 1475060 cougar_w
cougar_w's picture

No doubt China has bought insurance up to their eyeballs.

Though under the circumstance it's kinda hard to imagine anyone being in good enough health to pay out in the event of a US sovereign default.

Wed, 07/20/2011 - 17:18 | 1475242 InconvenientCou...
InconvenientCounterParty's picture

"No doubt China has bought insurance up to their eyeballs"

you can't, by conventional means, insure against the alpha TBTF.

Unconventional means yes. They could un-peg the yuan and watch the $ go into compound prolapse. They could stake their claim on Taiwan and establish a new world order. The opportunity for both is growing.

Wed, 07/20/2011 - 17:39 | 1475299 Steaming_Wookie_Doo
Steaming_Wookie_Doo's picture

I believe they also have insurance in their Song class subs with the sonar defeating coating (same one that popped up--undetected--in the middle of a US war game back in 2008). One or two of those off the eastern seaboard might be an interesting gambit.

Wed, 07/20/2011 - 18:19 | 1475416 Troublehoff
Troublehoff's picture

why would you want to insure against your end goal, the overturn of the West

Wed, 07/20/2011 - 16:33 | 1475075 SheepDog-One
SheepDog-One's picture

Ah so....but remember the 'airplane contrail' off the Cali coast...maybe next time not headed out to sea but to DC.

Wed, 07/20/2011 - 16:43 | 1475103 Careless Whisper
Careless Whisper's picture

We gots planes too.

Oh, and those genuises over at American Airlines are buying even more of 'em. I think I'll try their logic tonight at home.  Honey, I'm home... the economy is so good I think I'm gonna borrow a ton of money and buy two brand new fully loaded pickups, a Ford F-150 and a Chevy Silverado. Gotta spread it around. The new pickups get 20% better gas mileage.They pay for themselves. hehe.

Brilliant.

 

Wed, 07/20/2011 - 17:24 | 1475264 TruthInSunshine
TruthInSunshine's picture

Buy two Chevy Volts that you can tow with those trucks, because they're supposed to be fuel efficient, too.

Wed, 07/20/2011 - 17:02 | 1475199 pods
pods's picture

I remember seeing that original vid SD1.  The long version that zoomed in and out..

Even compared the trajectory to the flight they pawned it off as.

Scary stuff.

pods

Wed, 07/20/2011 - 18:30 | 1475448 cossack55
cossack55's picture

One can only hope. 100 megaton oughta do it.

Wed, 07/20/2011 - 18:53 | 1475505 Tuco Benedicto ...
Tuco Benedicto Pacifico Juan Maria Ramirez's picture

The Pentagon said they don't know exactly what that was last fall or where it came from.  Translation:  We know exactly what that was and who triggered it and it wasn't us.

 

Tuco Benedicto Pacifico Juan Maria Ramirez

Wed, 07/20/2011 - 16:39 | 1475091 Amish Hacker
Amish Hacker's picture

And the ultimate FU to Japan and the UK, the next largest holders of UST's. But the #1 largest holder is that consortium of private banks known as the Fed, and no one is allowed to say FU to them. Ergo, no default is coming.

Wed, 07/20/2011 - 18:22 | 1475426 Troublehoff
Troublehoff's picture

it's all just pieces of paper

a scoring system that is broken

it is a fantasy

Thu, 07/21/2011 - 02:52 | 1476275 Hook Line and S...
Hook Line and Sphincter's picture

'a scoring system that is broken'

succinct and accurate...

and wired to a nuclear and exotic weapons scoreboard

Wed, 07/20/2011 - 17:29 | 1475277 boiltherich
boiltherich's picture

As of March Chinese holdings of foreign reserves topped 3 trillion in dollar value, though the amount we Americans owe of that is right about 1.2 trillion (unless they have found another quarter trillion or so bought for the Chinese by a straw buyer) and the other 1.8 trillion is from trade with other nations, three guesses who a large chunkof that is from, if you Guessed the Eurozone and euro reserves you would be right. 

If I were China I would be a whole lot more afraid of their own inflationary spiral because of all the yuan printing they have to do so they can buy dollars and euros to hold down the value of the renminbi.  The Euro is going to turn out to be a failed currency in a short time, the Chinese will not like that, and the dollar will be renamed the American Lira so the mandarins in Beijing will really be pissed about that.  In the end it is their own fault for pursuing a grossly rapacious mercantilist trade policy built on the slave labor of hundreds of millions of peasants.  If you are in awe of the rate of modernization and building in the PRC it is because they know the game is almost up and the flows will stop, the reserves will be worthless and the world will be in the worst depression it has ever imagined. 

By the way, that IS the optimistic view! 

Wed, 07/20/2011 - 23:09 | 1476060 snowball777
snowball777's picture

It would be the ultimate FUCK YOU to China to default though right?

And makes about as much sense as foiling a rapist by burning your own crotch with hydrofluoric acid.


Wed, 07/20/2011 - 16:27 | 1475028 espirit
espirit's picture

Ha Ha. Buy the rumor, sell the news in this centrally planned economy.

Sounds bullish.

sarc on/off, I forget which.

Wed, 07/20/2011 - 16:50 | 1475143 Perseid.Rocks
Perseid.Rocks's picture

There is no 'preparing' to default. We've been defaulting on our debts for the past 100 years through devaluation of the currency. This plosser is a tosser. The US dollar has devalued 99% in the past 100 years.

That's the Fed's purpose... devalue the currency so the politicians can spend beyond their means. All this stuff about full employment is just to keep the little guy feeling like he's important (he's not).

Wed, 07/20/2011 - 20:43 | 1475742 IQ 145
IQ 145's picture

 + yes. it's amazing really; using "default" as a media event and distraction, while the de-valuation continues.

Thu, 07/21/2011 - 01:44 | 1476239 firefighter302
firefighter302's picture

"This Plosser is a tosser".  Perseid.rocks

I'm voting quote of the week on that one.

Brilliantly stated, mate!

 

Wed, 07/20/2011 - 16:26 | 1475031 Fazzie
Fazzie's picture

 Naw the Fed is just ramping up the scare tactics to help the political whores in Washington keep the money flowing from taxpayers pockets to bankers,politicians,Ukranian whores and drug dealers. Thats all theyre doing.

Wed, 07/20/2011 - 16:28 | 1475047 Fazzie
Fazzie's picture

 Apologies to all Ukranian whores and coke dealers. I didnt mean to lump your relatively honest profession in with such utter parasites, just making a point,

Wed, 07/20/2011 - 16:31 | 1475061 pods
pods's picture

Agreed Fazzie, at least they work for a living.

pods

Wed, 07/20/2011 - 16:40 | 1475098 cossack55
cossack55's picture

With more of a sense of honor than any of those scumbags on the hill or at the WH.

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