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Fed Preparing For US Default Says Plosser
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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Didn't you notice GS was up huge, and the markets were sucking wind?
They're already short.
Maybe Ben will Literally fire up his helicopter now and start throwing money out. Good work Ben!
what? He'll still only throw money out to the priviledged. It's their job to spend it and let us look up, waiting for the trickle.
What freaking sycophant even went with the idea of trickle down economics when the idea was first floated? Bunch of nuts in this society, I tell you.
Fear not, the can will be kicked....
"The White House shifted gears on Wednesday and signaled that President Barack Obama could support a short-term increase in the U.S. borrowing limit as long as it is part of a broader deficit reduction deal”
"Obama previously promised to veto a short-term extension of the $14.3 trillion debt limit. But White House spokesman Jay Carney said in a written statement the president would consider an exception if congressional leaders look like they're getting close to a deal for a long-term debt limit extension with deficit reduction."
"the president would consider an exception if congressional leaders look like they're getting close to a deal"
translation... anything short of chambliss and coburn crapping on Obama's desk will be considered an exception and disaster will be averted.
fix't
I've always liked Plosser. He wrote the book on, and coined the term, "Real Business Cycles".
The onset of peak oil (2006) is currently being defined by economic collapse.
Economic collapse was to happen ANYWAY.
The blooddrinkers are masking the effects of peak oil that began with ARMs.
ARMs were the trigger to ignite the keg. Take out a loan in 2003/4 and that loan adjusts in 2006/7...just as oil was peaking.
No surprise BS and Lehman's vaporized when oil hit $147 (i know i know - all speculation ...umhmmmm)
Does not matter if the debt ceiling is raised or not...oil has peaked...economic growth has ended...debt can't be serviced...so default is ordained.
Gold to the moon.
And if you think solar panels and nucs are gonna turn this boat around...I got a bridge in AZ I will sell you.
Enjoy the kill off.
There isn't a soul alive that doesn't want Gold to the Moon.
Coincidence, a post I made yesterday about giving each American One Million Dollars, minus all mortgae debt, credit card debt and auto loans....anyhow, its time now to move the Decimal Point by 2 notches. Call a bank holiday, call in all current dollars and issue New US Dollars at $1.00 Current = $100.00 New Dollars
Foreign Debt can be paid at 1% of Current
Yes they will get Dollar for Dollar, no default, its just going to be New US Dollars. So the Foreign Debt can be paid-in-full at 1/100, 1% of Current type USD
Mortgages are kept at Current but Payable with New US Dollars....and no more bad mortgages, and correct and make good all the new ones made. This has to be addreessed, and a few other items too.
So we can put these 2 big problems behind us, and start to bring back manufacturing jobs to the US.
The word "millionaire" is relative to the country you live in and currency used. Many people in the world are technically "millionaires", but its Billionaires there that carry the same meaning we "used to have" for millionaire. I intentionally bracketed millionaires because haven't we been prepped for this already? Think about it. In the past few years we've been hearing Billions and Trillions tossed about liberally. Its not just the country standing with a debt that can't be paid, so are many Americans, with many more heading that way as we stand now. Wouldn't this allow for Jobs, Manufacturing to return to the US? Its not just about Pay, its about the Purchasing Power of your pay. We have been heading Down, and the Emerging Markets Up, big time, for about a decade now.
People who make lets say $800 a week will start making $80,000 a week. Of course a $2 bottle of milk will then be $200...etc., similar to many people in the world, like Japan's YEN, Italy's former Lira, Asia, Mex, Latin America, countries where its common to purchase everyday items in hundreds and thousands. We'll get used to it quickly.
I think that's what Bernanke is shooting for, except he wants to do it "orderly".
Really? That doesn't sound so bad. Of course I was thinking in reverse order, 100 old ones gets one new one and all your debt-mortgage etc-would of course be priced in new ones. Of course im a full time pessimist.
What about coinage?
They never bother with coinage, no matter how bad it gets. Save em up.
http://www.youtube.com/watch?v=_Mw15mqA-ys
I hope this also means the Fed is packing their bags while they're at it.
"Know by now"
I've noticed many typos in Tyler's writing of late.
Fill up your meds and proof read homeboy. You're better than that.
"Tsssk. Such ingratitude after all the times T. D. has saved your life."
Tuco Benedicto Pacifico Juan Maria Ramirez
The Milli Vanilli avatar, along with attack choice 'meds' and patronizing
familial 'homebody' informs of the Plastic McD's conceptual level highest
reached, sad emotional, intellectual and spiritual poverty being complete
in this specimen
It was a joke guys, but TD is better than to slip on the writing after putting in so much thought with most of the content.
Cool story "MobBarley"
He's not leaving us in the desert either.
The fed isnt going anywhere, debt ceiling will be raised woth deficit spending cuts that will be massive. If noone wants to buy UST, simple, the fed will! lol why do people think that markets will go down? this is bullish scenario if i ever saw one. ohh debt crisis debt crisis OMG what are we gonna do?! "we have come to an agreement, with deficit cuts" is exactly what they will say on aug2. markets will RIPPPP. dont be caught short. THROW AWAY YOUR TECH ANALYSIS, bc it doesnt matter anymore. just BTFD as always rinse, repeat. fucking people at ZH dont get it.
To me that seems most likely. Other than that my main thought is gee, it sure is great living somewhere that can fly apart at the seams at any moment. Of course I guess that could be anywhere. I mean afterall just how safe could we be standing on a giant rock that's flying thru space. LMAO.
+100 @mfoste1
bernanke give the 'people' money..? if the gov reduces someones mortgage debt it really is a bailout of the bank. the home owner bought a house for 8 times their earnings and now it is only 6 times...and they will be ok? the people will never get bailed out. the fed will do whatever is best for the central banking system and politicians will continue to do everythig in their power to enrich themselves at the tax payers expense.
i know people keep saying this but, this cant go on much longer....the QE and taxation and inflation. i get the feeling we are right on the cusp of no return.
Studet loans too?
And what will Gold and Silver be priced at?
"""""Studet loans too?"""""" YES, I didn't incude all the details
""""And what will Gold and Silver be priced at?""""" as for Au & Ag just add 2 zeros
more student loan debt in US than credit card debt.....i thnk there is some risk there. Wanna really bailout the govt and banks? forgive federal student loans that will never be paid back anyways because how can you pay a loan back without a job? damn, thats one fucking crazzzzy idea isnt it? so you pay to go to school to work your ass off to get a good job to work your ass off to pay back for working your ass off in school. kinnnndaaaa seems like a scam to me.
"cusp of no return"? Someone wiser than me please correct me, here. Near as I can tell there has never been a "return" plan, or re-entry scenario even imagined [well, maybe they looked, and said "nnaaaah"]. In other words, it's a one-way, 6-lane highway straight to da fukin' moon, Alice
Bullshit. My fantasies are guided by no rules. Why are we to believe this system of make believe will suddenly evaporate into the ether because a faux rule has been violated?
http://lonerangersilver.wordpress.com/2011/07/20/silver-huge-manipulatio...
Watch this video....http://www.ubest1.com/?page=video/30859#null
and here (off topic)
http://www.dailymotion.com/video/xigpz8_rense-moret-les-plans-sinistres-de-google_news#from=embediframe
Elenin is coming out of Virgo and Leo,
This is heavy and beyond serious.
Google it past the dis-info.
Is it related or appropriate for rational,pragmatic ZH'ers?
Not on the surface, much like a continent destroying submarine, not on the surface.
I think it was JP Morgan who was famously quoted as saying,
"Millionairs don't believe in astrology,Billionairs do".
How is this related to things financial,political etc;
You could go to the Fed for data, Wall street, Harvard U.or the White House?
A rational and scientific approach to a CLOWN CAR is not always the best path.
that would be quite the mindfuck wouldn't it? always held that JPM quote in the back of me head for safekeeping.
got a link or 2 to share?
http://www.jpl.nasa.gov/news/news.cfm?release=2011-135 Comet Elenin is completely without meaning. The poster is just another nit-wit with a desperate need to believe in some kind of big problem.
Funny, my avitar is a response to douchebags with IQ complexes, in the form of Sarcasm,
The lowest form of humor. IQ 101,like Geography 101, get it ?
Sarcasm translates poorly on the web, and for the most part,
you wind up conveying that your IQ is 101. Still, this would
place you on the high side of the bell curve, if you can be
proud of that.
164, if you insist,bell curve Bob Marley,
but that was a thousand beers ago.
thanks, but i'm much closer to IQ 101 than 145 and us nitwits like to stick together, you know?
IF these comet-planet-star alignments are correct, it does seem an odd coincidence that they happen to line up so neatly with 6.0+ earthquakes, doesn't it?
http://www.ufo-blogger.com/2011/04/nasa-elenin-2011-comet-planetary.html
but maybe this can be explained away rationally?
http://www.archive.org/details/witnessofthestar00bulluoft
If you down this PDF and read it,you will never see the world in the same frame again.
or you tube elenin/Virgo for some new agey lead up's to the reallity.
Comets -> Astro-NOMY, your cluelessness. Yes, a 4km wide comet hitting Earth would be worse than Lehman and Bear. No, that isn't going to happen.
“Comet Elenin will not only be far away, it is also on the small side for comets. And comets are not the most densely-packed objects out there. They usually have the density of something akin to loosely packed icy dirt.”
Did I say that this ice cube will have a gravitational effect on Earth?
Did I say anything other than I thought and know,it is coming out of the constelation Virgo and then Leo,I find that VERY interesting because my entire life revolves around living, not just the aquisition of wealth,to pose before my neighbors.
No one expects the Spanish inquisition!!!
If you diss me,diss me for MY Words! not my respondants.
http://www.levendwater.org/books/witness/the_witness_of_the_stars_bullinger.pdf
Have a read,it might make your balls drop.
The funniest part of the article:
"The Fed lends to banks at the discount window against good collateral."
Why the hell isn't Plosser out in the Grove? Doesn't he know there is a big boy party going on? He should just let Bernanke and Geithner deal with the problem.
Nothing occult like happening at the Grove, is there?
Non of that silly astrological magical baloney.
Please refer to my post above,another paradigm is afoot amongst our fearless leaders and it is not "scientific" or compassionate, but it is ancient and mostly hidden.
Who has a guest list or links?
"I know people keep saying this but, this cant go on much longer....the QE and taxation and inflation. i get the feeling we are right on the cusp of no return."
I feel the same way, actually way past the cusp. There always seems to be a new way to kick the can. It seems the "wildcards" in their accounting always surprise me.
It can't go on forever but who knows when... All I know is that if it was me doing this type of accounting, myself and Bernie would probably be cellmates.
This is quick on its way to being a 1000 threader. Nice! Bernoccio should announce QE3 immediately upon default. Then grab your ankles and look for some gold down there. 2011 Silver Eagles are coming out at $54 each I believe. Hope you have a few. The barter system will soon be in full effect since Bernoccio says that Gold isn't money, its an asset that is held as a tradition. Ben can have my dollars and I'll keep the family tradition.
Wow, no mention of Goldman Sach's role in the chirade, because we all know someone from there is involved....if not for anything less than a 100% on the dollar guarantee again.
Is GLD or SLV the best PM stock? What others do you recommend?
You don't buy gold and silver stocks.. you buy physical.
+1 - Unless you can take delivery immediately, it doesn't mean shit imho.
STOP thinking PAPER or STOCK!
THINK ACTUAL COIN OR BULLION SITTING ON YOUR DESK that you can see, touch and enjoy.
BUY PHYSICAL.
If the default happens, your bank and stock accounts will VANISH. That's not a joke.
Buy and take delivery of physical, dig a hole, hide it and dont tell anyone.
The Gold and Silver of today is in 401K and IRA's and folks have forgotten the real value of physical Gold and Silver. I agree, must start accumulating Gold and Silver to avoid this crap.
Buy and take delivery of physical, dig a hole, hide it and dont tell anyone.
The solution is simple. Just close all federal departments that are not explicitly authorized in the constitution. That'll reduce outflow enough so all legitimate bills plus SS can be paid. It is time for millions of federal workers to go looking for a productive job. Then close down all US military bases on foreign territory, except for any the host country wishes to fully pay for [temporarily]. That will balance the budget and even leave a little extra cash to start paying down the debt.
Of course the vastly better solution is to follow the example set by the other nasty empire, the USSR. The best case scenario is, the USSA simply shuts down and vanishes. The state and local governments in the USSA are more than plenty enough government.
Would be nice. Unfortunately we don't live in that kind of world.
Don't we?
The USSR did used to exist, did it not?
I was referring to your solution as unlikely in this world i.e. small .gov. I appreciate your optimism.
Hmmm... where in the Consitution does it explicitly state that we should have Soc. Sec.? I am having trouble finding that bit.
You won't find SS (or Medicare, or Medicaid) in the constitution. That's why I said "plus" before SS. I guess I could have been clearer.
I'm just saying, if people want to end SS, Medicare, Medicaid type stuff gradually, that can be done. But yes, 99% of what the central government does is not called for, including ALL of the overseas bases and ALL of the undeclared wars. The military of the USSA should be about 1% of what it is today.
Or to be more accurate, the whole central government of the USSA should shut down and vanish, just like the USSR did. I don't understand why people think it is utterly inconceivable that the federal government of the USSA simply cease operation and vanish. The other evil empire in the last 50 years did exactly that, and everyone on earth is better for it.
Davy Crockett had much to say on this subject,
his words still ring true,methinks.
http://www.pointsouth.com/csanet/greatmen/crockett/crocket2.htm
Oh, to live on a planet populated by people like that.
Unfortunately, that planet shall not be earth.
And that's the problem.
They need to get rid of all the debt ( just write down every mortgage in america to 25% of principal thats where home prices are going anyway)
Wasn't Plosser the guy they put up with all them smart ideas of how they were gonna sop up all that liquidity? C'mon y'all, keep your eyes on the ball. Its just a circus act.
By the way, love the Barney Frank avatar.
We're going to default eventually. So let's have at it and start over.
Let the games begin. Its over. 401K etc will be converted to annuties and the rtns will be peanuts
Gawd, I've never in my life seen such a collective group of inept morons. If I had to pick who is dumber, the morons at the Fed or the morons at the treasury I'd be hard pressed.
Gawd, I've never in my life seen such a collective group of inept morons. If I had to pick who is dumber, the morons at the Fed or the morons at the treasury I'd be hard pressed.
it might actually be the guy who keeps hitting the save button
sub 50 Chinese PMI rumor hitting wires.
Link?
Because that would be something.
I mean that in all seriousness, though I must confess that the man has me so dazed and confused that I'm not sure what is serious or not, anymore.
I used to think I could use logic and rational thought to calmly plan on what was likely to occur, and then I discovered that those who run and rig the game were on to those who planned on using logic and rational thought to calmly plan on what was likely to occur.
Chaos and Fog of War forces you to operate on Doctrine because information is never complete. Formulate your plans and advance them forwards. If PM's is a battle as one plays chess, I already in it up to my eyeballs.
The stakes are nothing less than your Freedom and very Life in a Nation that is one of the few in this world where one can be able to exercise the things we have done.
I'll shut up because I am not much of a Orator. I rather verbally abuse my crew until they are all moving in the same direction at the same speed towards a task completion.
+1
So in other words:
"...does the Brotherhood really exist?..." (That, Winston, you will never know. ...)
money is not gold..
"We are developing processes and procedures by which the Treasury communicates to us what we are going to do"
Do you know when a Fed Bank President is lying?
So what are they saying? Is Fed going to unleash a $100 dollar bill tsunami and drown everyone in worthless notes? Is this what QE3 is?
Damn, I wish I had invested in a bomb shelter......
If my Bank account was inflated as one inflates a balloon over night, I would be absolutely moving very fast to purchase what goods and services at the old prices until the Nation finished upgrading, reprogramming and applying new price stickers to everything.
The one place you will not see me is in the mall or any place that has fluff or imaginary friends. I have weapons, ammo, prep, crops and land and so on etc etc etc. The rest of the County will flock to the big mall downtown and feast like children on candy at holloween until they get sick. When the sun rises again and they emerge from the piles of discarded foam, wrappings and plastic they are going to be hurting really badly.
It seems like nobody truly knows what to do, except the Tea partiers and they are willing to everything except defense in order to cut spending.
Defense because YOU, ME and OUR FAMILIES, NEIGHBORS etc etc etc are bought and paid for by the millions of Vets who have fought and died for our Nation. What they have purchased with the blood on the tree of Liberty is precious and priceless.
I for one refuse to prostrate this Nation before our enemies. No fucking UN Blue Helmets or Arab Speakers blaring call to prayer at 5am in my County. No sir.
We will all be raped over the coals before it's through. For all intensive purposes, the pre-Madonnas have won . . .
"Attention all banks of the solar federation"
"Attention all banks of the solar federation"
"We have assumed control"
"We have assumed control"
"We have assumed control"
-The Priests Of The Temples Of Sphincter
You just shit all over Neil Pearts lyrics. May you be reincarnated as Dennis Kneale
nooooooooooooooooo
++++++
Nah, I was just adapting them to be more contemporary. 2012 rather than 2112. You don't "Hold the Red Star proudly high in hand" do you?
I hope they pass the deadline, and otool holds the largest, wealthiest, constituency( Hostage) ViA: S.S. The last nail in his coffin will be inserted. Then we can buy him a !'st class ticket on the [ MILLENIUM FALCON ] And send his Wookie ass to the SUN!!!
I hear Ruperts G550 is available as well. He is upgrading after the witchhunt ends...
I'm seeing a plan in your future....trains...gas...old people. Solvency!
Nice 1!
You fools being lead by King Fool, Tyler, keep saying,(and betting), the market is going down. For God's sake, give it a fucking rest and get over it. This machine is programmed to go only one way, up. The world is totally fucked and we wake up and the sun rises. I buy hand over fist and it works. Simple.
Tongue my crapper, ya worthless libtard... Explore yield curves, and purchasing power you worthless tool...!
actually, he has a point. getting out too early means missing the ride. ask me how I know.
there is no such thing as long term, its just an infinite number of short terms and the people investing short term are doing very, very well.
Yen! Stay cool, you know I know you know.
Just move the US Government under Maiden Lane 4, and someone will eventually buy back some bits.
[T]he 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.
Notice how Reuters conflates the federal government with the entire economy. What a bunch of ignoranuses.
That's because Reuters is controlled by the global finance cartel, or TPTB. Take any of their reporting on finance with a true grain of salt and a healthy scepticism, and corroborate your information against other sources at all times. Just my .02 worth.
http://www.youtube.com/watch?v=OVtinv5LSnE
Print, print, print some more,
Fiat, fiat, on the floor.
Money, money, everywhere,
Printed from our progenies inher-
inher-itance now, don't you see?
You don't need it to be real,
You just need to steal,
You just need to believe,
Ignore the peeps in the sieve.
Grind those old folks and babies to bones,
It's party time at the at the FED, hang up da' phone!
I read Timmy is too busy preparing to write down (i.e., Bailout all speculators and Flippers):
"If the Treasury indeed announces this plan, while touting its aim of "helping families," it will be very interesting to see if the families being helped include speculators, wealthy borrowers and those who enjoy a vacation homes in the Hamptons."
http://www.thestreet.com/story/11192386/1/mortgage-bailout-plan-would-st...
"...developing processes and procedures by which the Treasury communicates to us what we are going to do," Plosser said..."
I thought the Fed was an independent body....why would it obey the Treasury, the Fourth Branch of the Gubberment?
..the FED is a PRIVATE Bank..
Tim Geithner has repeatedly confirmed the Treasury has absolutely no default plans
Not that he would ever lie.
my best guess...once the fed owns all the outstanding treasuries it will finesses them into oblivion on its balance sheet with some miracle accounting trick and the problem goes away for tim. THEN they figure out what to do next. its a very elegant solution, actually.
But, for sure, they have a plan and have always had a plan.
What a bunch of fucking horseshit.
The U.S. isn't going to default. It's just more bullshit fear.
They scared us with Saddam. They scared us with TARP. They scared us with stimulus.
It's time to tell these motherfuckers to go fuck themselves.
But what do I know?
http://geraldcelente.proboards.com
I agree.
Geither does not have a backup plan, because honestly this has and will become Obama's responsibility if August 2 arrives without a 'solution'. I am convinced Obama already has a backup plan in his mind and we will see it come out on August 3 if things stay as they are. I believe he will invoke the 14th amendment about the validity of debts and he could well order the Treasury coin seignorage issue that I have seen some recent discussion about. Obama knows Congress is dysfunctional now and has been for some time, his neck is on the line if things get too fucked up in the country and he will execute his Executive powers to avert this kind of anarchy. What options does he have other than this? That's right, he doesn't.
This is starting to remind of the hype and the bullshit leading up to Y2K, and about Armageddon next year supposedly.
What this does illustrate is that our Congress has in many ways become a useless appendage. It may make some people feel good, but the truly hard decisions are kicked upstairs and this one will be as well.
This is a very good post rich with ideas rarely spoken anywhere I've seen thus far.
A debt ceiling impasse that turns into a literal matter of constitutional law, testing boundaries of what the POTUS can and can not do, and how he can or can not do them, in terms of an end run around such an impasse, the time involved (even with expedited court proceedings), and the risk of adverse decisions by the courts, could be ruinous on so many levels that the abyss would not be a term that would be inappropriate.
This is far worse than y2k and Obama will go to the courts if need be. The courts haven't been too brainy lately but they should concur. But, this will leave a mark. Mainly, faster contraction of derivatives. While our government plays finger pointing.
The point is the hype compares to Y2K not the actual event (or lack of). Nothing substantial is going to happen on August 3, much like nothing happened on 1/01/2000. There is a workaround already in place, and I'm betting that someone somewhere in the TPTB are smirking big time at watching the domestic debate about a potential default.
Where this could be VERY interesting is if late Friday they have NO resolution the stock market will make a large move, probably down as they won't want to hold anything over the week-end with this unresolved, well what a coincidence that Friday is options expiration, so we get a large drop, all/ most call holders get hosed, than a resolution is announced late Sunday b4 foreign markets open MUCH higher, now all the TBTF banks have a huge inventory of stock they took cheap due to option expiration, thoughts?
The real part of this is the slow grinding loss of faith of the heart of America in their government and institutions, and their slowly but steadily cashing out of the system and not paying their mortgage, bills, taxes.
The mules and oxen of the corrupt system are leaving the farm, and the farmer's boney body will be trompled then picked clean by the crows - sooner or later.
Rot in HELL Washington and Wall Street!
Well.. HELL is really a ROTTEN place..
www.youtube.com/amgineco
.. after death+resuscitation ..these men have seen it.. wouldn't really wish it on anyone..
But they can rot in a prison somewhere [preferably w/o TV, phones +w/ dirt floors] .. ANYWHERE!
I'll add this footnote. While the American public's attention has been focused on Aug. 2, those of us on ZH know that the current default started on May 16 and when this gets settled, we are already $200-$250 billion in the hole towards the next debt limit review since Geithner has plundered other retirement fund cash balances to function the government over the past 60 days plus. I have seen no reputable MSM report on this status for weeks. That overdraft should be repaid before anything new happens. Will Geithner repay the retirement funds he's been tapping for weeks? When it gets right down to it, will he? I'll bet they may be considering how bad the uproar would be if they reneged on this obligation, and force appropriated this money without repayment against the government employees will, and deplete their retirement accounts. How soon before they come after everyone else's the same way?
Interesting tidbit in there:
"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?"
I've read that the bureaucracy, various agencies and so on would have a hard time coordinating who to pay and who not too. Just a giant bureaucratic clusterfuck.
So this makes it sound like they might have to keep writing checks and recipients would have to figure out if they'd be honored or not. This would create even more chaos then just informing people they won't get a check. Every contractor who gets a fed check for some service or other will be scrambling to find out if it will be honored.
I wonder if they would try to throw together an IOU system ala California?
The latest Washington Post ABC poll has some dramatic results
" Even among Republicans, 58 percent see the GOP as too resistant to a deal, up from 42 percent in March.
I think we should stop the countdown, Dr Chandra.
Best ideas for the ludicrous short-term monkey/lemming 11th-hour debt-ceiling deal reflation trade?
As above,so below.
remember the words of Davy Crockett.
http://www.pointsouth.com/csanet/greatmen/crockett/crocket2.htm
How will the Fed cover the checks on the Treasury checking account?
Well if the balance sheet for the week ending July 13 is an indication, they'll borrow it from the banks in the form of newly typed up bank reserves.
$27 bn of treasury checks were cashed, covered by typed up reserves of $24 bn.
So, as with the prior week, bank reserves escalates even in the absence of QE.
The Fed added a new wrinkle last week. Tyler has long focused on the magical category of 'other assets.' Yet, last week, the FED discovered an extra $17 bn in 'other liabilities. Money wthat was used, in part, to cover the non QE QE purchases of $6 bn in Treasury paper.
So, QE continues post QE, bank reserves increase even in the absence of formal QE and the magic of 'other assets' and 'other liabilities' blossom anew.
Its a Debt star trench scene.......then heavy taxation....
The disneyland banner of vader made me think of it.
Translation-the more bearish ZH is, the higher the s&p goes. 100% absolute fact! Buy The Fucking Dip!
Europe is still living in denial. Now there's PIIGS add Belgium in now at 97% GDP. There's not enough money on this planet to save the U.S. or Europe with all the debt obligations, future and present. All these leaders want to do is kick the can until they retire on their cushy caribbean island far away from the travails of debtopolis. The eventual outcome of all of this is each solvent country having to, at some point, arbitrarily forgive the debt of money owed them as was done with some of the emerging market countries in the 90's.
thought i walk through the valley of death, i shall fear no evil nor death, for i am "The BErNaNKe"
Bullish?
When the Fed plans for default the people must plan for their safety.
I think that everyone should pull out enough cash from banks to last out for a month at least.
Pulling out money from the TBTF banks would anyway be an ideal and a correct thing to do as they are the ones who got us into the mess in the first place.
Timmy and gang are extremely capable of closing down all banks for a couple of weeks
Tomorrow's headline "President Gets Increase; More Lies Ahead."...