T-Minus Two Months Until The $500 Billion Rolling Debt Ticking Timebomb Goes Off

Ever since the famous Stanley Druckenmiller Op Ed published in early May, which called for an outright default of the US, saying it would not be
the end of the world, and in fact the US would emerge stronger as a
result of finally taking the first steps to getting its fiscal house in
order, there has been a visible shift regarding the US debt ceiling discussion, with republicans (so far) digging in and refusing to budge on the issue. After all, on the surface Druckenmiller is absolutely correct: with interest rates near record lows for the past 3 years, interest payments would be manageable for a long time even if general rates were to surge due to the Treasury's fixing of low cash coupons over the past 3-4 years, amounting to about 20-30% of all annual tax receipts. There is however one very big problem with this argument, one which we pointed out back in April 2010 when we said that "What people don't realize is that...unless the UST can roll its debt not on a monthly
but now weekly basis in greater and greater amounts, the interest rate
doesn't matter. All it takes is one semi-failed auction and it's game over as hundreds of billions in bills become payable." Enter the always forgotten maturing debt argument. And as a just released presentation by the Bipartisan Policy Center titled "Debt Limit Analysis" reminds us, aside from the actual deficit funding math, which is that in August there is a $134.3 billion cash shortfall that has to be funded with debt, there is a far greater risk. Or, put numerically, 467.4 billion far greater risks. This is the amount of debt that matures through August 31, and has to be rolled over or the US is bankrupt... in every sense of the word. Once again, America's politicians and media get broadsided by the definition of gross versus net. Because, in reality, the inability to issue more debt post August 3 means a halt to all new debt issuance. Which, unfortunately because it means Geithner's scaremongering is actually correct, would imply the end for the debt ponzi.

Below is the maturity schedule in August from the BPC:

And their commentary, which recaps what we said 14 months ago:

• Treasury must “roll over” almost $500 b in debt that matures during August 2011
  • New debt is issued and the proceeds are used to repay the maturing debt plus interest due
  • Treasury will require market access throughout August to avoid defaulting on maturing debt
• About $380 b in short-term T-Bills maturing, plus $90 b in long-term securities
  • Quarterly refunding auction on August 15

And that's not it. On a Net basis, there is in addition another $134.3 billion in deficit that must be satisfied somehow. Alas, after August 3rd it will become impossible to plunder savings accounts going forward which means a game over in the kick the can down the road game:

Breaking down the spending side:

The BPC's observations on what happens on August 4 absent a deal are rather spot on:

• If the debt ceiling is not raised by August 2, all three ratings agencies will put the United States on watch for a downgrade, at a minimum. Fitch (6/8/11):
  • “If the debt ceiling is not raised by the [X Date] and timely and full payment of its obligations, including Treasuries, is not secure, the U.S. sovereign rating will be placed on Rating Watch Negative.”
• An actual downgrade would cause major losses among holders
• Even without downgrade, it is likely that rates would increase, perhaps significantly
  • Less likely, but possible, that Treasury would lose market access during such an unprecedented event and default

As a reminder we are now 32 days away from D-Day, and about 60 days from the need to fund half a trillion, all of it with new gross debt issuance.

To date, there has been no progress in D.C. at all. Will there be progress in the next 4 weeks? They better, or as demonstrated, the extend and pretend game, contrary to the well-meaning intentions of the likes of Drucknemiller, is about to come to a very violent end.

Full presentation link.

Debt Ceiling Analysis

Comments

[Mr Lennon Hendrix]

Soon, we will all be millionaires!

[dwilso39]

Zimbawe style baby; that what I'm talking about: 100Trillion dollar notes!!  BALLIN'

[cgbspender]

I recently picked up a set of Zimbabwe fiat trash notes, in denominations of 10, 25, 50 and 100 million Z$. I'm slowly adding to my "Failed Currencies" collection. So far I've got some Assignats, Zimbabwe Dollars and a few US Silver Certificates.

[AmCockerSpaniel]

Wrong wrong wrong; Only the upper 1/10 or 1% is getting the new money! The rest of "all" are getting you know what.

[dwilso39]

So that means my Gold and Silver are Golden (intended).

[AmCockerSpaniel]

YES; But you know, it will take as much GOLD to buy what ever, as it does today. It's like having a no penalty (early with draw) CD, that just keeps up with inflation. In 1911 it took about one ounce of gold to have a tailor made suit. Today it takes about one ounce of gold to have a tailor make you a suit (if there are still tailors out there). It is for this reason, we don't want more than 1~3 years of the buying amount "you need" of the stuff.

[Man Bear Pig]

Be wary of the "men's suit comparison". Just a couple hundred years ago a wealthy man amidst 1 billion others on this planet might have had a handful of fine men's suits, a nice house and a large plantation. Today a wealthy man would have dozens of fine suits, a couple mansions, a large yacht, 29 flat screen TV's, an iPhone, and a sizable paper-wealth trading account. And that is among 6.75 billion souls on the planet. Compare wealth with wealth, not suits with suits.

http://fofoa.blogspot.com/2009/11/gold-is-wealth.html

[carbonmutant]

Timmay knows better than any of us that there is an end to the road.

And Raising the Debt ceiling will only delay the inevitable...

[Freebird]

Your new Chinese overlords are waiting patiently for a phone call.

[carbonmutant]

 I don't think buying EUROs is a solution to their problem..

[baby_BLYTHE]

I dare them not to print

[dwilso39]

I dare them "too print".  Silver $500/ oz.; Gold $8,000/oz.  My only problem will be what color to buy the yatch in???

[Calmyourself]

The price of yachts may be up a bit by then, buy now, beat the rush on yatches..

[dracos_ghost]

But but but... CNBC says the markets are off to the races now that the Eurozone debt contagion is over.

[JW n FL]

this is a transitory issue that Tyler has brought up.. it will pass.. buy stocks and enjoy the ride up!! LULZ!!!

[Caviar Emptor]

This is the ultimate political theater with both sides knowing they're going to raise the debt ceiling and bailouts till the cows come home. But they each want to exploit the aura of "crisis" to get a bigger share of the newly minted money and other things they want. It's called negotiation skills. Has nothing to do with what they preach. In fact who are the GOP to preach fiscal responsibility with their track record (Reagan administration tripled the Federal deficit while preaching small government). 

They will raise. 

[SheepDog-One]

Fine with me, go ahead and print a couple more trillion, Id love to see my gold and silver blast off 30% higher overnite.

[DoChenRollingBearing]

Since we as individuals cannot influence what they do in DC, SheepDog is completely right.

Gold and silver will shine!

[BigDuke6]

There you go talking about gold again....

Good man.

[FlyPaper]

Out of curiosity, which party controlled Congress while the budgets under Reagan went up?  And what happened to tax revenues?    

[Calmyourself]

Shh, you just confuse them and then someone will say there is no left and right only a dichotomy and no spoon.

[knowless]

http://1.bp.blogspot.com/_O4uNza0PAx4/TKaXxcqelzI/AAAAAAAAAAw/56DJHouWA0...

[Hank Paulson]

Again, you can never have a failed bond auction, the system is specifically designed to never fail, you don't even need to sell bonds actually.  I don't know why people get nervous about a failed bond auction, it cannot happen, mathematically.  

[gdogus erectus]

Yeah, funny how there's no problem printing money to keep paying interest or keep the war machine going but just wait until someone asks for their pension money back after they have been raided.  "We just can't afford it."  "There's no political will." 

[DosZap]

Are we expected to Swallow this crap?.

HUNDREDS of missions daily are being flown over Libya,and now were lobbing million $ missles in Somalia.

Where are the funds coming from for these Billion dollar a day NEW adventures?.

But, we MUST do something about the DEBT!.

It's called stop ALL uneccessary spending,and cut where you can w/out starting a war on the streets.

That would make Seven,with it being the worst.

[downrodeo]

Word.

And now, some thoughts from Bill Hicks:

Here's what we can do to change the world, right now, into a better ride. Take all that money we spend on weapons and defense each year and, instead, spend it feeding, clothing and educating the poor of the world, which it would do many times over -- not one human being excluded -- and we can explore space together, both inner and outer, forever. In peace.

Full story:

http://tehomet.net/bill.html

[AGuy]

Sounds like a great way to make a population bomb. Ever see the move Soylent Green? We breed like a bacteria colony, ever growing until we consume all of the available resources, then endure the die off cause by insufficient resources.

[NuckingFuts]

Soylent Green is delicious.  Tastes just like chicken.   Coming soon to a government food station near you.

[Libertarian777]

the flaw in your argument is that when you educate someone, you lose power over him. Better to just send him some 'aid'... and 'educate' him about how great our aid is. We can't educate and feed the masses. They might figure out the system. Then we're in the sh1tter.

<2nd attempt>

"Math question cannot be longer than 3 characters but is currently 4 characters long."

captcha... what is 33 x 37 = .... 1221... but limited to 3 characters... WTF is this captcha run by the Treasury department? the National Debt is not $14.5 trillion it is $1.45 trillion.

[AmCockerSpaniel]

And that's the issue I have with printing money for "some".

[lolmao500]

Riiiiiiiiiiiiight.

[Tyler Durden]

Perhaps you should send Chartalism 101 to the current Treasury Secretary who doesn't seem to believe in magicwandism:

If investors chose not to purchase a sufficient volume of
new Treasury securities, the United States would be required to pay the
principal on maturing debt, and not merely the interest, out of
available cash. Yet the Treasury would be unable to make these principal
payments without the continued confidence of market participants
willing to buy new Treasury securities.

Source

[Silver Dreamer]

I'm unfamiliar with the term magicwandism, but it sounds like a banksters term.  It certainly explains the process of creating money out of thin air.  Poof!  Who's going to be the first to write the Urban Dictionary entry?  There isn't one yet, but there needs to be...

[falak pema]

how about "hard bandism" or "darn wankism" or "loner cowboy t-bonism".

[Rodent Freikorps]

I've heard of HandWavium.

[metastar]

Tyler,

Exactly. Who is going to buy all this debt in such a short time frame? It sounds like an awful lot of debt to me, but hey, what do I know? The criminal cartel must surely have some ace up its sleeves.

[MsCreant]

The Fed will buy it. They'll eat anything. "Hey, Ben likes it!"

Here is the deal as I see it, all of the accounting anymore is a fiction. The system was broken log ago. The ponzi stands because we let it stand and participate in it. As long as the US public does not understand (or worse, the different classes are complicit because they benefit from the fiction in different ways) it can and will continue. It is going to take a 2 x 4 up to our heads to get folks riled up enough to object and do something different. China rolling up heavy on our shores is laughable, we make like we are enemies, but that too is part of the fiction. They are as bad as we are. The question is, who is the better story teller and seller. Believe which ever fiction you will, they will keep the ponzi going through our ignorance and/or complicity until the story becomes unbelieveable. That happens when:

1. Some other countries decide to call our bluff and go to war with us because we are consuming and polluting too much.

2. We run out of food.

3. We run out of oil.

4. We run out of safe, nonradiated, nonpolluted land that we can occupy.

This won't stop until we are up against the limits of the petri dish (mother earth) herself. They will just keep telling more stories that folks buy for their various reasons, and this shit is going to continue. The depression was the depression because we SAW the people suffering. No one sees this, so the story continues. 

[RockyRacoon]

As I understand it, the Fed cannot directly buy those hot-off-the-press Treasuries.  That's why were're having all this PD shenanigans and flipping back to the Fed.  Not a problem.  "Exigent circumstances" can be invoked and they buy directly.   That would not be a new precedent setting move on the Fed's part.

[MsCreant]

I should have said indirectly, though I do think they can announce any program they want to and they could get away with it. With all they have done already that is so obviously printing and check kiting, without any over sight at all (they don't want to see, see), it is clear to me that they really can keep it up until there is structural failure that is obdurate in nature. By then it will be too late to do anything if you are not prepared. I know you know all this, just sort of getting it written down to be read in case more than the choir is reading. Really nice to see your posts. Chicks do think cute is cool. ;-)

Would love advice from you and a few others around here about a moral/financial delima I have going on. To ponzi or not to ponzi is my question. Tis it more noble to borrow funds and go into a small amount of debt to supplement insurance funds to rebuild a destroyed house, or tis it nobler to say "fuck off banker skum" and convert PMs to fiatscos and not take on the debt?

[RockyRacoon]

Sure thing, the Fed can do what it wants until it is called on it -- and then it's too late.

Not having the full facts of the matter I can't comment on the financial situation.   Contact DCRB and he'll fix you up with a contact.   Tell him I said so.

[DoChenRollingBearing]

???

Either or both of you send me a gmail at my name, I'll do what I can (which ain't much).

[MsCreant]

I suck at fake contacts. Ended up outing myself both times. I have met 1 ZHer live as a result, which was fun to do. I would love to talk about the situation, ner the less.

[chindit13]

Not sure if I occupy that rarified atmosphere of being one of the "both", but if so, rest assured that even under threat of rendition to a Turkish jail, any "outing" you may have done goes with me to the grave.  As irreligious as I might be, some things I hold sacred.  (I would have sent this privately, but Gmail won't accept my proxy anymore, and TPTB block all email.)

All the best.

[MsCreant]

I felt like I was safe with you when it happened. Thanks for being who and what you are.

[FinalCollapse]

So what if the Fed gives $1T loan to PDs, at 0%, and the PDs buy all USTs (plus speculate in oil/gold), at 2-3% range?

It's not really money printing (not M1 for sure), it is circular Ponzi scheme of debt issuance.

[Jendrzejczyk]

"The ponzi stands because we let it stand and participate in it."

"To ponzi or not to ponzi is my question."

If you have a roof, outside walls, windows, doors, utilities, a bathroom and a kitchen, you are far ahead of 80%(?) of the rest of the world.

Borrow what you must to get the basics in place. Have faith in your abilities to learn how to do the rest.

[MsCreant]

You are a good one to catch for this.

We have to demo the place and remove a 100+ year old tree because it is rotting before we can start to build. We will get geothermal heat and air, and build it from ICF, to energy star specs, tight. My issue is should I sell PMs to do this and not go into debt, or go into debt and hold? Which one supports the Ponzi worse? Which one is the better survival choice?

[RockyRacoon]

Lower your standards as needed and build to the insurance proceeds limit.

No debt, no liquidation of assets.

If you have "replacement value" problems just work it out with your contractors -- if ya know what I mean.

[Jendrzejczyk]

I've supported the ponzi with every fiber of my being for the last 47 years, a total sheeple/debt slave with a silly fantastic FICO until the economy took a dump. Take my advice with the appropriate quantity of salt.

If you sell your PMs, you are throwing away your real insurance. (That corporate home insurance ain't replacing your home is it?)

If you borrow only what you need to get the basics in place after a tragedy,  and cut costs wherever you can, feel no guilt. 

After all, you're only promising to support the ponzi at a future date if all goes well. ;)

[CompassionateFascist]

Keep the Pre-Menstruals. Do the debt thingie. We all must participate in the Universal Ponzi. That way, when System Collapse comes, it will be all the more total.

[PY-129-20]

Dr. Goebbels would be proud.

I ask you: Do you want total ponzi? If necessary, do you want a ponzi more total and radical than anything that we can even yet imagine?

[delacroix]

rebuild the house yourself, but more effecient, and simpler. use the insurance money, to pay off the property. I've lived in a HUD repo, that it took my wife and I 3 years, to refurbish. employ yourself, and family members, with your own money. skip the contractors, with their workmans comp, and insurance costs, to cover. make it an adventure, a family project.

[Jendrzejczyk]

Three years....your wife is a saint. Living in a construction zone for any length of time can be hell on earth at times.

Kudos to you both.

[RockyRacoon]

It does take some perseverance.  My first wife and I lived with paint cans and ladders, moving the furniture (what little we had) from room to room until various houses were complete enough to sell.   We traded up with sweat and various wounds for 5 years before we settled in a very nice house and started having the 2 kids.   It will either build a relationship or destroy one.   Fortunately, it was not the remodeling that ended the relationship after 12 years.

[Miss Expectations]

Regardless of what you do (rebuild or take the money and rent something modest 'til things become clearer)...I would advise keeping a close watch on the weird weather.  Please watch this guy forecast severe weather 2 to 3 days before it hits.  I believe he is saving lives.

1) AccuWeather News:  Upper Midwest severe weather outbreak

http://www.accuweather.com/blogs/news/story/51899/damaging-storms-rip-th...

2)  Dutchsinse's Forecast 2 days before it happened

http://www.youtube.com/dutchsinse#p/u/5/qbS2dolus7g

[tip e. canoe]

thanks for this, ms.E.   that guy's good...real good.

now wrap your mind around this lil' coinkidink:

http://floridagulfskywatch.blogspot.com/2011/02/el-rothschild-recently-b...

(sorry chindit, couldn't resist)

[Miss Expectations]

thanks tip e. I miss the florida gulf skywatch site.

Don't like the connection between the Weather Channel and Monsanto, either.

http://blog.cornandsoybeandigest.com/briefingroom/2009/01/06/the-weather...

But, It might explain Jesus showing up in the form of Kudzu :)

http://www.wwaytv3.com/2011/06/29/kudzu-jesus-discovered-lenoir-county

“I glanced at it, and it looks like Jesus,” Hardison said. “I thought, ‘You can’t spray Jesus with Roundup.’ ”

[earnulf]

Tis a dilema indeed.    Unless you are completely underwater (but not necessarily behind on the mortagage) you are held liable for the debt.  Otherwise, you may be forgiven at the discretion of the banking overlords.   But given the direction of debt and the injurious rates of interest, one must consider the wisdom of parting with true value for the sake of debit, even if it is one's home, free and clear.     Given existing home rates, I would take on a bit of debt and keep the PM's dry for later.

[MsCreant]

I hope all who commented come back and know that I read and am grateful for the feedback. Thank you. Keep the PMs is the common denomenator from all the input!

The debt will have to happen, I think. I did own it outright, but now it is totaled. The insurance money would build a really shitty house. They told me to build the shitty new house and sell it (hahahahah in this market, hahahaaha, whew, my sides are hurting). Thing is, I have the title, the location is the beast I know, so to get a house that is worthwhile, I need more funds. I think I am building an urban doomstead. Bullet proof, can withstand 140 mph wind, fairly termite proof, geothermal heat and air, highly efficient energy wise. I will have a wood burning stove in there too.

[Central Bankster]

+1

They will paper over everything until it collapses.  This process just extends and pretends the status quo and further distorts the "real" economy (distorts: saving rates, time preferences, economic preferences).  This process guarantees when it all comes down, that it will be epic.  Such is the fate of centrally planned economies.

[TooBearish]

Ty - always appreciate your attention to detail - however remember who is acting as agent for the Treasury in all auctions - yup the FED - if you don't think for a second that Ben would not bid the auction through whatever mechanism available - well there's a bridge in NYC i can sell ya....

[Fukushima Sam]

This seems about as sustainable as eating your own poop.  It's a poop-loop!

[oldmanagain]

I appreciate the article as it does blow up the Pubs cretinism on what the risks are.

I think the Pubs have to realize that resting on the Fed debt are state and city debt, and above all about 600 trillion plus in derivatives mostly hidden from view.  We are broke, we need time to whittle on the debt and grow.  

Someone on the Pub side has to own up to the fact that a big part of the debt  is Soc. Sec. that is owed to the fund by congresses who used the  surpluses to not pay taxes. Now that the bill is due they want to cut the benefits instead of paying back what they stole.  Now they want everyone, except the wealthy, to pay the bill.

I am sure we can kill our fragile econ quickly with stupidity.  But there are many who will perish that are egging them on.  They will find out what "animal spirits" really are. But how much solace is there in watching senseless carnage caused by sheer ignorance.

As I write, Ron Paul says it will not hurt one bit. And a lot of other Pub leaders.  The great provider will appear and save us all.

[fxrxexexdxoxmx]

And not a single Dem had a hand in any of it.

Evil, child killing, grandma raping, Pubs.

[OldTrooper]

Ahhh...I understand!  You actually think the left-right puppet theater matters.

[lawrence1]

JS Sinclaire recently said that there was increasing withdrawals from money market accounts but I didnt see a reference.  Rules regarding money market funds were changed over a year ago to permit the managers to stop withdrawals if they deemed sufficient danger to the fund.  And we are seeing increasing limitations on daily, weekly withdrawals from other accounts.  Are we approaching the crisis of confidence that triggers hyper-inflation which may be triggered by something like this? 

[Printfaster]

Why cannot the treasury just print UST dollars to pay for all maturing debt?  They used to print gold and silver certificates.  These would be the same, just cut out the middle man fed.

[Quixotic_Not]

You think the 'MeriKan .gov has Ag & Au to back certificates?

ROFLMAO!

[PY-129-20]

Dramatization (*tick tock*)

http://youtu.be/6nvKN_H4e-I

[Blotsky]

For all of the times that I have heard about threats of a downgrade, it amazes me to think that investors actually have any confidence in the USD.

This game that DC is playing has to be apparent to everyone out there, otherwise they are living in outright denial.

Am I wrong, or does that basically sum it up?

[DosZap]

No, your assume the people ARE aware.

The people are products of the American Public school fiasco.

They cannot even balance a checkbook,80%+ never watch any news,nor read the news.

Nor would they  have a clue WHAT it meant anyway,as long as they can get by, they are as happy as a clam.

When the cakes done, then you will see them react..............just CUT off their .gub checks.

The SWHTF.

[iDealMeat]

+1

[foxman]

just go long equities, all is well

[lolmao500]

And when the ``free stuff`` crowd don't get their free stuff, it's gonna be riots everywhere... and of course it'll all be blamed on republicans... Obama being, of course, the white knight in shining armor.

This is gonna be historic... if republicans hold the line.

[fiftybagger]

Lock and load

[Mr Lennon Hendrix]

O/T

NEW YORK (Reuters) - The "apparently successful" bids for the U.S. Strategic Petroleum Reserve's release of crude oil stocks totaled 30.64 million barrels at an average $107.19 a barrel.

Well, that was easy.  Now to Martha's Vineyard for a long weekend of masked balls and golfing.

[MsCreant]

Mr. Hendrix,

Masked balls. Hmm.. is that what rapists in the Hamptons do? Or is that Obama putting a mask on his golf ball because he is so ashamed.

I apologize for these puns I was unable to help myself, so I helped myself.

[RockyRacoon]

Probably NOT what you had in mind...

[Agent P]

Now I get to spend the three day weekend trying to get that image out of my head...thanks Rock!

[Mr Lennon Hendrix]

His masked balls are most likely not ashamed.  And rapist at the Hamptons are masked the same.

The Labyrinth of a Psychopath:

http://www.redicecreations.com/radio/2011/06/RIR-110626-tsheridan.mp3

[Cognitive Dissonance]

The second hour for subscribers is even better. Nice to find another fan of Red Ice.

[Robslob]

So I now see the Win Win for banks...S&P hits 1400 in July then failed bond auction in August market crash uh retraces then Big Ben announces QE 3....got it?

[MsCreant]

This is the kind of fiction writing these folks cook up. We get mad at them because they are doing bad math, when we should be mad at them because of their creative writing skillz.

[czarangelus]

Sorry, the Republicans already promised that it was just a political show. There's no conceivable way the limit won't be raised. Why allow the day of reckoning to happen if it can be staved off another 6 months?

[BigDuke6]

Exactly... and another 6 months and another 6 months...

[dudley]

The only way they can pull it off, and I believe they will, is to have a very strong dollar.

[faustian bargain]

I don't see how that can work.

[dudley]

Perhaps I am too much of a cynic but the there are two ways to get people to buy US debt: High interest rates ( which they don't want ) or uncertainty in all the other currencies.  The US is very pragmatic, if it suits the US to have a strong currency for a short time ( or even a long time ) to help sell debt I think they they will arrange that.  You probably think I am I am a wishful thinker - I am not.  I have a healthy respect for their ability manipulate - just look at silver .

[Calculated_Risk]

3. Monetize.

[falak pema]

like a cork screw on a hard rock decorking...how to break your teeth...

[doggings]

interesting that Greece will be scrabbling for their other $6 billion around the same time. 

http://www.zerohedge.com/article/greek-math-%E2%82%AC12-billion-%E2%82%AC182-billion-out-and-thats-if-impossible-happens

summer will be "interesting" this year.

[Piranhanoia]

You have to wonder who will be part of the war to fix the stupfied gaze of the sheep and their herders.

[Corn1945]

No one is going to pay this money back anyway. Might as well default now and get it over with.

[Greeny]

Exactly, they should rise the Debt Sealing to

$20 trillion at least, to allow some room for further manipulations,

otherwise they going to be Playing those games on monthly basis.

[Arius]

while you are at it ... why not REMOVE the ceiling completely.  Why do we need it anyway if it can always be risen .... it just creates unnecessary problems .... i say REMOVE the ceiling!

[Rodent Freikorps]

Then what would we do for a dose of the theater of the absurd?

This is DWTS for the news watching crowd.

[SheepDog-One]

HELL with the Sealing! Raise it, at ONES!!

[Hugh_Jorgan]

GOOD!!! If it gets debated every 6 months, then maybe we can finally get basic economics, the US debt situation, the Fed and all the dirty pool players to become part of the average American's knowledge base and vernacular. Maybe we can think about a real solution when everyone finally understands that none of this is rocket-science and that most of the people that make up our "ruling class" really are crooks that need to spend some time in orange jumpsuits!

[Silver Dreamer]

Are you kidding me?  The corporatists will keep the music playing as long as possible.  As long as there are sheep to fleece, the fleecing will continue.

[Greeny]

Default now? ha-ha.. Well, why default now, while credit

card is unlimited? Load 3x times more debt and then default,

making more sense.

[White.Star.Line]

Default is NOT an option.

That would put an end to the "debt for assets" program and take power away from the usury clan.

[wandstrasse]

Print The Pain Away!

adopted from the Peaches song 'F*** The Pain Away'

[antidisestablis...]

Fool me once about the end of the world, shame on you.  Fool me every month for the past many years, uh...uh...won't get fooled again.

[RobotTrader]

Must be a huge amount of money rolling out of bonds into equities.

This is hands down the fastest 5 day rally I've ever seen since Greenspan's surprise double rate cut back in October 2008.

Then Fleck was mind-boggled at the subsequent 600% rally in the SOX off those lows.

[Arius]

this is bullish!  Greenspan was adomant and firm this morning on CNBC interview - NO more QE - the man should know ... i dont think he would lie to us ... would he ???

keep it up Robo!

[Greeny]

NO more QE? Do you even reading this Article what you replying for? It's says that 500 b worth of the Debt waiting to be rolled over.. There maybe not official QE, but look at the Markets.. QE3 is here already, man.. 171 point up, this is just Panic Buying going on... We might see 15000 in couple of weeks instead of the END of 2011 :))) Though many Energy and Metal stocks are still under pressure, but Technologies are blowing things away, even CSCO is up over 2% today and that's something BIG.. Hopefully Miners will participate this rally soon..

Booyah, bitchez!!! :))) Let's count some cash...

[Arius]

if they keep it up for another 2 weeks, i will agree w/ you on the Panic Buying ... otherwise ... watch out below (once the 4th barbeque weekend is over) ....

unsolicited advice: dont go on long vacations this summer if you got money in this market ....

On No more QE, i simply quoted Greenspan ... who am I to question the man???

[PY-129-20]

It cannot read. It's a robot. It's here to post ridiculous things and to amuse the gang. Robo is just a symbol for the stupidity that is the current market.

[WaterWings]

Yes, a good reminder of the groupthink out there. Plus, we can avoid the disadvantages of typical monocultures.

Thanks Robo! More wildebeests!

[SheepDog-One]

Bonds to stocks to bonds hot potato? Who's on the other side? You can have it all, Im not juggling hand grenades this is stupid, good luck youll need it.

[kito]

robo, whats your bond/equity prediction for end of summer? 

[gulf breeze]

Robotart does not make predictions.  She only has current daily charts. The radio programs she listens to can only help sooo much

[Calculated_Risk]

robo doesn't do predictions, just cherry pickin..

[Jendrzejczyk]

You're sooo nice, why don't we like you?

[Jendrzejczyk]

....and Donny Osmond handsome too.

[Central Bankster]

Yes, I heard Zimbabwe's stock market went soaring during hyperinflation!

[The Axe]

well if you are right,,,look for a correction in gold....

[mkkby]

Tiny amount.  Holiday week... everyone in Hamptons.  Explosive rallys like this are always short covering.  We'll see what's real Wednesday.  No pomo and the pros are back on the desks.  I'm guessing they reshort at the higher levels, but it's anybody's guess at this point.

If you believe in the conspiracy, the primary dealers have to tank the market to scare congress into raising the debt ceiling and doing another POMO.

[JuicedGamma]

This reminds me of the scene in "Hurt Locker" where James cannot save the Iraqi man with massive bombs strapped to his body and just in time runs away.  (http://www.ejumpcut.org/currentissue/alpertHurtlocker/2.html)

Most likely this is Timmay's strategy, let it tick down to the last second and head for the hills.

[apberusdisvet]

The problem is that Obama's ratings are going into the toilet and sheeple are starting to wake up from the indoctrination/disinformation coma.  The elites need another false flag attack so that another national security slush fund of a few trillion  or so can be immediately voted on.  Stop looking at the magician's waving hand; it's the other one you really have to worry about.

[SheepDog-One]

Wheres the fear and panic for QE continuation? DOW up +200 daily, and the people are supposed to be begging for more QE at any cost no matter what? WHERE is any need for further emergency measures, I dont see it! Unless the markets drop 10% next week, nothings adding up!

[Arius]

simple - its the 4th of July.  got to have people feeling good about stocks when they gather around barbeques ... so, the people who sold will feel sorry ... prospective sellers will think twice of selling couple of weeks later, hoping it will go up again...

before they know it, it will be under 12000 and then all breaks lose .... give 2 at the most 3 weeks ....

[SheepDog-One]

Robo explains its bond dorks now abandoning bonds and jumping into bubble stocks? Makes no sense at all, and this ends in total disaster.

[SheepDog-One]

Go fuck yourself, loser! BTW I NEVER said 'market will crash tomorrow, market will crash next week' piece of shit liar.

[SeverinSlade]

Anyone catch Geithner suggesting that BHO consider using the 14th amendment to bypass the debt ceiling?

One way or another, the US won't default.  They have to keep the ponzi scheme going.  If we enter August without a deal, watch BHO take that route.

[slewie the pi-rat]

it's the Doomsday Machine, BiCheZ!

oh, mighty mogambo, please save us, now!

[DoChenRollingBearing]

He would tell us to buy gold, silver and oil.

And he would be correct.

[lolmao500]

And how much debt matures till let's say... January 1 2013?  2 trillion? What?

[in-Credible Banker]

This is without doubt the best piece I've seen posted at ZH.  Thanks ZH!!!!  You rock!

[Kobe Beef]

So US Treasury debt is a full-fledged ponzi. What a racket.

[New American Re...]

Barry Soetoro will just whip out his version of the 14th Amendment and raise the debt ceiling.   Screw the Constitution.   There will be no default, we won't have a default,... "we don't need no stinkin' default!"

[SheepDog-One]

The whole rest of the world defaults and gets massive austerity while the way more bankrupt than any of them USA just chugs along piling up more debt but never capsizes....I still dont buy it not for a second.

[topcallingtroll]

such are the burdens and blessings of owning the world currency.

[n00b tube]

Where's CDad? I need live commentary on today's Mark to Unicorn finish. Who will win? Crocodile Algo, Hedge Fund Freakshow, Hopium Trader, Mutual Fund Redemption, Thirteen Times S&P CrackPipe Dream?!?

[sasebo]

Whatever it takes to get to a gold standard & 100% reserve monetary system. Until then all a bunch of stupidity & dip shit. 

ABCT pretty much covers the current situation.

[AldousHuxley]

Make it simple and cut every budget category by half.

[mt paul]

then cut it by another 50 %..

repeat ...

until budget balanced ....

[buzzsaw99]

I hope this fight drags on a very long time. Having the prez and both houses from the same party sux azz.

[jomama]

funny, last i checked, it's all one 'party'.

[buzzsaw99]

yeah but the law enacting has slowed way down.

[mt paul]

economic crack party...

[Praetorian Guard]

Everything seems to be imploding... Our latest news letter for those interested...

GLOBAL EVENT HORIZON - WHAT IT MEANS FOR YOU

What exactly is an "Event Horizon"? An Event Horizon, from a scientific perspective, is "a boundary in space-time beyond which events cannot affect an outside observer", or in layman's terms, the "point of no return" (1). The term "Event Horizon" is normally ascribed to the distinct and absolute horizon found around a black hole wherein the escape velocity of a black hole is greater than the speed of light. Once an object or particle is within the event horizon, nothing can stop the inevitable movement into the hole. So much for the college science lesson, but how does this impact or apply to life here on Terra Firma?

Our life here on Earth is being affected by a soon approaching, if not already present, Event Horizon. No, we are not going to be sucked into a black hole, per se, but we are experiencing a "point of no return".

Events are coming together at an accelerated rate, much like two race cars, at high speed, traveling in opposite directions on a figure-eight track. The inevitable is soon, if not already present. How so, you may ask? Simply put - life on this rock is changing, both physically and socially.

As Guns, Grub and Gold reported two years ago, changes in forecasted weather would lead to the severe crippling of crop production, which in turn would lead to massive food shortages and immense pressures on governments to subsidize their citizens, and call for export restraints. We are starting to see global evidence of this with regards to climate change, altered weather patterns, and massive droughts and flooding - which are NOT indicative of man-made global warming, but something far more insidious, and unstoppable - time based, sinusoidal waves of geophysical-solar/celestial interaction.

Epic floods, wildfires, droughts, tornadoes, and extreme temperature differentials are ravaging the United States and other countries throughout the world. Scientists are now warning that these climate changes will bring even more extreme weather. The human and economic toll over just the past few months has been staggering, wherein hundreds of people have died, and thousands of homes and millions of acres have been lost with initial cost estimates topping more than $20 billion US dollars. Even more frightening, from a human and economic perspective, is that peak hurricane season has not yet started in the United States. Deke Arndt, chief of climate monitoring for the National Oceanic and Atmospheric Administration (NOAA) has indicated that "This spring was one of the most extreme springs that we've seen in the last century since we've had good records" (2).

Rest of article:

https://www.gunsgrubandgold.com/forum

[jomama]

we've been crying wolf for so long, it's amazing we haven't lost our voices yet.

[Praetorian Guard]

That may be true, but it still does not escape the fact that from a logical and mathematical perspective we are hosed. They might be able to kick the can down the road, but as each day, month, year passes the quality of life, purchasing power of currency and principal/debt ratio will continue to be a problem that will affect everyone. Even a broken clock is right twice a day. What happens when the broken clock shows midnight, and the true time strikes 12? The fecal matter will be on...

[ebworthen]

Time to start that war with China.

Taiwan?  North Korea?  Or simply our presence in the South China Sea?

A sunk U.S. sub or incursion into Taiwan, declaration of war from Congress, and no more debt to China.

Might be a backdoor way to bring justice to the banksters as they might actually lose something this time around.

There may still be time for us to start up those places that make stuff again...what are they called...oh factories!  I think that is where people worked too.

If we don't stop the road we are on we will be getting chicken and beef shipped to us from China - stop the insanity - START THE WAR!

[malikai]

Did you forget to take your prescription today?

[ebworthen]

Did not have Woman today.

But think about it, war is the only eventuality if you look at world history.

Think of the hand-wringing isolationists in the U.K. and U.S. who knew that Hitler and Germany had to be subdued but waited and waited because there was too much money being made on trade.  Same for Japan.

The business cycle always leads the war cycle and the population limiting cycle of human behavior.

[BigDuke6]

Great, the yanks clear their tab for buying iphones and plastic tat while china gets a good excuse to secure/invade raw materials in australia and PNG.

Thanks a bunch mate.

[ebworthen]

Yup, we masturbate while they procreate.

We are losing the battle in the big picture.

[Geoff-UK]

What ees thees "failed auction" of wheech you speek?

Senor Bernake buys anytheeng that does not sell at Senor Timmy's auctions, jes?