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Treasury Refunding Upside "Surprise", Q2 Borrowing Higher Than Previous Estimate By $71 Billion, Sees September Debt Of $13.6 Trillion
Today the Treasury issued its quarterly Treasury Refunding statement in which it announced that previous estimate for Q2 borrowing were woefully below expectations. We are confident none of our readers are "surprised" by this development, although seeing how it is an "upside" surprise it will be further evidence of the benevolent decoupling of the US economy from the world. In a nutshell here is what Tim Geithner's payday lending operation announced: "During the April – June 2010 quarter, Treasury expects to issue $340 billion in net marketable debt, assuming an end-of-June cash balance of $280 billion, which includes $200 billion for the Supplementary Financing Program (SFP). The borrowing estimate is $71 billion higher than announced in February 2010. The increase in borrowing is primarily related to cash balance adjustments associated with the recent restoration of the SFP to $200 billion. During the July – September 2010 quarter, Treasury expects to issue $376 billion in net marketable debt, assuming an end-of-September cash balance of $270 billion, which includes $200 billion for the SFP." In other words, the Treasury itself, which chronically underestimates its funding needs by about 20%, sees $716 billion in net funding needs in 6 months. Zero Hedge is prepared to make a market (and no we won't disclose to you that you are idiots if you sell protection on this bet either) on this number actually being north of $850 billion.
Some more details from the Payday Lenders:
During the January - March 2010 quarter, Treasury issued $483 billion in net marketable debt, and finished the quarter with a cash balance of $219 billion, of which $125 billion was attributable to the SFP. In February, Treasury estimated $392 billion in net marketable borrowing and assumed an end-of-March cash balance of $95 billion, which included an SFP balance of $5 billion. The increase in borrowing and the higher cash balance were due to a combination of the increase in the SFP balance, higher receipts, lower outlays, and higher State and Local Government Series net activity.
In April, the Treasury issued a net of $176 billion in total debt (includes Trust Funds and marketable debt), to end the month at $12,892,729,000,000. The final Bill redemption balance in April was a paltry $596 billion, or $675 including Bonds. Let us repeat: in April the US Treasury had to roll over two thirds of a trillion in debt. Assuming the treasury is correct, the Treasury balance will be $13.23 trillion on June 30, and $13.6 trillion on September 30.
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How close are we to the debt ceiling? Any chance we'll hit it before midterm elections?
I was thinking this as well. And the answer is "unless the Treasury pulls a rabbit out of the hat", we may need another boost in that debt ceiling before November.
I also was wondering if this would be before the Nov-2010 elections ...
I agree with Tyler that this projection is under-estimated, and we are in the process of a cashflow feedback loop (we are in the process of a parabolic blowout). It could take months, maybe a year or two. Not three.
However, there have been a few "near-misses" for the US in the last few months. I expect the EU and the Euro to die first, but we almost had the US die first a couple times (the first one to die, loses, since the last-man-standing will benefit as people flee from the immediate collapse).
With economic activity surprising us to the upside, we just might be also surprised by the strength of tax receipts paid in by corporations during the summer/autumn.
Just a thought...
I suppose. I'm amazed they held it together to this level.
However, I can't get past the *real* unemployment (north of 20%). Those jobs aren't coming back, and I expect unemployment to increase. We've become used to 40% of US GDP from the financial sector, and that won't come back either. The stock market fantasy doesn't drive the world -- the world runs on real employment (and real consumer spending), and the bond market (all Fed printing these days). It's not real, and I can't conceive of "normal" companies actually making widgets posting any serious numbers in 2010.
Consumers are defaulting on their mortgages, and spending their mortgage payment at the mall. That can't, and won't, last. Like the US Government, it will inevitably become a cashflow problem.
Vizzini reminds me of Lord BlankCheck.
Actually, looking at John Williams’ Shadow Government Statistics No. 294: First-Quarter GDP, Mounting Systemic Risks released on April 30 to subscribers it hasn’t held together, as you imply. According to Williams’ subheads: GDP Growth Lacks Sustainability and Economic and Systemic Risks Intensify.
Williams provides a very pessimistic view of the short-term economic future and suggests that a major economic event is likely: with economic figures showing very little strength and increasing weakness.
Says Williams, “The signal for a renewed, major deterioration in the economic downturn (a double-dip for those buying the economic ‘recovery’) was generated at the end of 2009. That signal not only is continuing but also is intensifying…”
It is a powerful report showing that “in this ‘happy’ environment, where the economy and systemic stability are sharply at odds with market perceptions, the rallying equity markets appear to be removed from underlying reality in the extreme.” Williams’ outlook for a hyperinflationary great depression in the United States remains unchanged.
This one report alone is well worth the SGS subscription price.
http://www.shadowstats.com/
"Consumers are defaulting on their mortgages, and spending their mortgage payment at the mall."
I still think people on ZH are overestimating the above phenomenon.
Possible. However, for this to be over-estimated, we must:
This mathematically cannot continue, so it will not.
aren't many companies sitting on loss carry forwards?
The last time they visited the debt ceiling they voted themselves a cool $2T in head room, which seemed like a lot at the time. Well now we know what they knew, and that it will be enough to get them just past Nov.
I guess that explains at least some of why this http://research.stlouisfed.org/fred2/series/WSECOUT is not coming down any time soon.
Holy s**t!!!!!!
It's amazing that the Fed can look at these graphs and say with a straight face that the economy is improving, that things are getting better. It just goes to show how strong the hive mentality is among it's strongest proponents.
These very same people, if shown this graph 20 years ago, would swear to God you were showing them a third world country. Which ultimately we are, the only mitigating factor being our "reserve currency" status, with the rest of the world falling into the "greater fool" category.
We've nuked the global economy. And they will love us ... why?
History will not be kind to the USA. Though I suppose if there is no one left to write historical accounts then that's a plus for us.
I think at this point they are just trying to prevent runs and mass panic. They are going to keep spraying freshener on the big steaming pile of crap and hope other countries have bigger piles.
It's like you can't outrun a grizzly bear, but you can buy time by outrunning your buddy.
Any country that embraced welfare state socialism is due for its day of reckoning. I'm talking about France, the UK, all EU countries. It was always a matter of when, not if. The US is not immune, either. There has been a tremendous misallocation of resources in the US brought on by tremendous greed, stupidity, and outright ignorance.
Houston, we have a problem.
looks like a map of the east coast, after Al Ghawar's global warming has taken out miami and the keys.
Holy crap...
Interesting. If you assume (I had to take someone else's number on this) the amount of interest bearing derivatives out there is 600T, then it means the Fed is levered a mere...
300:1
...What's that sucking sound?
Fish,
So we see BHC core business are equities? When they head for the exits, Obama is going to shit his pants.
When need a new volitility index to describe this risk. This is not a bubble, it is a Hindenburg.
Mark Beck
It will be interesting what number will break the proverbial camel's back. Hard to believe they got it this far.
"Hard to believe they got it this far."
The level of insanity is never surprising. What is surprising is that it can go so far beyond the level that the sane could ever imagine.
If the Federal government either lays off the gas for a second or is unable able to rollover the short term maturities it will be point, set, match.
There is no solution, there is only slowing the rate of collapse and attempt to delay further.
So they action roll out of an exploding car, off of a cliff, into a shark infested bay! Whats the big deal? There is nothing these psychopaths will not do.
"In a nutshell here is what Tim Geithner's payday lending operation announced..."
Nice. Only it won't really be payday lending until the interest rate hits 38% and the weekly fees to roll the debt equal another 1438% per year. Give it a few months to a year and we'll be there.
In fact, when we see the national debt service payments exceed the military budget, we'll know we hit nirvana. I think it will work more like a light switch. It's either on (working) or off (the opposite of working in economic speak).
Honestly, the debt situation is similar to the GOM oil spill ... swat teams (taxpayers) to the rescue
I would like to think that the re-ignition of the Fed currency swap lines is a horseman of the apocalypse. Now I've gone and done it... got Bad Brains in my head now! "Reeeee iiigNIIITioooon...."
"Tim Geithner's payday lending operation announced:"
Absolutely CLASSIC line Tyler...
Pulitzer Prize!
13.6 TRILLION
Gasp, the number is so vast it is mind numbing
This will end badly...
Yet when I talk to people, most are clueless as to what's going on.
They think things are picking up. I tell them disaster is coming and they ask when. When I tell them I don't know, I lose all credibility.
Unfortunately, I am going to regain that credibility some day.
When? I don't know.
I hear ya. I'm in the same boat. I know a couple that both work for Xerium (under chapter 11) and are looking at buying a house. The plant couldn't even turn out enough to cover payroll last month, phones are dead, but yet they hit the malls and want to buy a house. WTF?
Zach Karabell nailed the debt "problem" perfectly. He wrote:
"Let's take a closer look at the numbers. The amount the U.S. pays to service the national debt isn't particularly onerous. In fact, interest payments in 2010, which so many have touted as approaching $500 billion, are not much different in inflation-adjusted terms from what servicing cost 20 years ago, especially relative to GDP.
The reason we can afford such large debts is that interest rates are so low. At the beginning of 2000, it cost the U.S. government more than 6.5% to borrow money. Now it costs less than 2.5%. That means we can borrow 2½ times as much today for the same cost. Also, the overall economy has expanded dramatically, and relative to the size of the economy, the debt isn't particularly high by global standards."
So for all of you talking about how this is "historical" and "unprecedented" please refer to "inflation-adjusted" servicing terms. Pretty much right where we were 20 years ago! Seems we've been here before and we're still alive and buying iPads.
Well you and Zach make a great team.
Quoting a CNBC shill is worse than embarrasing
"At the beginning of 2000, it cost the U.S. government more than 6.5% to borrow money. Now it costs less than 2.5%. That means we can borrow 2½ times as much today for the same cost."
Dude are you freaking stupid or what? Is this the logic you use everyday? Only an idiot of epic porportions would post something this stupid anywhere. Read what you wrote again and see what is wrong with it. ROFLMAO this is exactly the kind of idiots we have running our government and exactly why the US is in deep doo...
Now if only they can figure out how to borrow at 0% then we can have a trillion times the debt level....sorry what's that you say, you have to pay it back? Well FUCK somebody should have said something about that before I ran off and borrowed 16 quadrillion dollars at 0% but it's like 30 years ago so everything is fine. STUPID FUCKING HARRY WAGNER!!!! I hate that guy.
Please, for the love of doG, please stop replying/responding to Hairy Canker. And please stop imaging that 'idiots' are running "our" government. Once you understand that the fed.gov is an organized criminal enterprise, then everything becomes quite clear. These people are anything but.
If you worked at a stockyard, would you purposely upset the cattle, or would you attempt to pacify them before the stun-bolt gun was fired? Likewise, why should the fed.gov unnecessarily gin up any discord/opposition? The MSM is key to assuring the herd that everything is justtt fineee. Righttt ...
Thank you B9, I was just about to post that. Harry is a plant so just don't respond. If Harry really felt the way writes why would he continue to come back. He can just go watch Cramer and feel good about his wisdom.
I get a laugh out of him. I just wish he would change his avatar back to that ridiculous face he used before, that picture really added to the nihilistic absurdity of his whole persona.
Nixon, how is the smell in NOLA? Any other man on the street stuff you can give us about the Horizon disaster?
We only smelled oil here in the city last Thursday. I expect the smell was from the burning they were doing then, I understand that was stopped. They must have figured out that transferring the carbon molecules from the water to the air would kill the people instead of the fish and birds and decided to spare us humans. Obama was here yesterday, in and out in four hours. I don't know what he accomplished other than tying up traffic in the air and on the ground for most of the day. The general feeling up here in the city is that this is probably going to be a disaster with an economic impact similar to Katrina, but the difference is that we don't have to run for our lives...at least not yet. No one trusts the government or BP or anyone else to do anything except make things worse, but that's understandable considering recent history. My gut feeling is that if they can't get this thing plugged more quickly than they're estimating this is going to be a problem for all of you, not just us idiots still trying to hang on down here.
haha, was just thinking the same thing. CHANGE IT BACK!!!
You are right B9, my apolgies, I couldn't restrain myself anymore, but you are right, ignore him.
I keep saying! Why is the Fed so modest, so wimpy at the hour of national crisis? Are they trying to starve the financials and corporations of liquidity? Didn't they already learn from the Great Depression that the Fed's mistake was being too tight with monetary policy?
Loosen up, people! This ain't no party, this ain't no disco! The country is parched, thirsting for liquidity while you're having a high old time of it writing your papers! Open the spigots, open them wide! Wider! Let's see some shock and awe and this whole mess could be over inside of a week!
Then we can all do what we, as Americans, have become the best in the world at: Shopping! Yes we Can shop our way back to prosperity and pull the world up with us!!
Seriously, this is exactly what happened in Greece. They joined the Euro, so rates dropped massively and the debt servicing costs fell. They ramped up borrowing cos it was cheap, and government spending goes into GDP, so they said look, the economy is growing strongly, this is no problem.... until it was.
"The reason we can afford such large debts is that interest rates are so low. At the beginning of 2000, it cost the U.S. government more than 6.5% to borrow money. Now it costs less than 2.5%. That means we can borrow 2½ times as much today for the same cost."
This post, more than any other, is precisely why this poster has zero credibility. This can not be said with a straight face among thinking men. Thus there is no need to try and argue with someone who has left behind any semblance of rational thought or reason.
We would not stroll into a mental institution and expect to have a lucid conversation with a person who has gobs of semi congealed drool running down his face as he speaks gibberish. We should expect no more or less from Harry Wanger.
CD, see my post above. Don't waste your energy on a plant.
Sadly I've come to the conclusion that the word "plant" more than applies. Harry Wanger is a psychological operation, a "planted operative" if you will, directed against the ZH community in a effort to agitate and demoralize. This black operation uses the same line of thought that is always hoisted against any truth, often using reasonably sounding but sometimes patently absurd statements spouted from the mouth of a well spoken and usually very polite person. A careful mix of fact and lie woven together to disrupt and disorientate.
Our culture has been conditioned to believe that if such a person speaks, and the current facts "seems" to substantiate what is being said, that there might just be some truth to what is being said. Even those who know he is full of shit still feel the occasional tug of doubt, setting up what I would call a reverse cognitive dissonance that works to re-cement the lie rather than shake out the truth. If nothing else, is eats away at self confidence and the clarity of the truth.
The insanity of Harry Wanger presented in a reasonable, clear and articulate manner. Very effective for the Yahoo boards but for the most part, as long as the ZH community is aware of this type of attack, it is mostly ineffective. Understand the reason and method of the attack and you can inoculate yourself from the effects.
Personally, I'm glad for the comedic relief...
...And he seems to be sharpening you droogs up for a bit of the old ultra violence, wot wot?
The same thing happened over in the climate change debate-o-sphere.
It's gross. It's also a sign of weakness on their part. Does it work? Not sure, but they think it works. And it's cheap at the price. So no down side.
It helps if you can lie to people in a way that assuages their fear.
Three little monkeys, no evil here.
http://findarticles.com/p/articles/mi_m1571/is_n19_v13/ai_19448573/
Insight: How did you begin to study disinformation?
NG: I started out working with the American Embassy in Latvia. They found me because I spoke very good English. Then I got into the Russian section of the embassy, which was very important at that time. We took care of all the reporting on Russia. We were the window on Russia. If, for example, our embassy in Turkey picked up some information on Russia, they would send it to us immediately. We were the center for analysis. There I learned everything I know about the USSR, and there I learned how to express my views and how to work.
After that, gradually, I began noticing that there were conflicts between what I knew and what the Soviets told us, and I began investigating these conflicts. How did it happen that my knowledge was not the same as what they told me? And that is where I discovered disinformation.
Insight: What's the difference between disinformation and propaganda?
NG: One is obvious, and the other is not. Propaganda is obvious to anybody with any brains, but disinformation is not.... Sometimes more than 90 percent of the content of disinformation is true. The thing that is important is to find the part that is false.
CD, surely you don't think anyone of us who regularly read and post to this site are mentally soft enough not to see HW and his ilk for the buffoons they are.
I don't think all the regulars are immune to the HW black ops program. But there were 3700 who read this article and many of them may have read the comments. How many of them, lets call them the silent majority, are influenced by the HW operative? For every comment, there are 10 to 20 that don't comment. What are they thinking?
As a former lurker and current Joe 6-pack, I would often think, "this dude is dumb as a bag of hammers." It's pretty much impossible to read his inane comments, contrast them with the responses, and come away thinking anything else.
My $0.02, adjusted for inflation.
Key differences:
Average maturity much longer 20 years ago.
Today there is lob-sided interest rate sensitivity. We are much closer to the zero bound on average interest rate compared to 20 years ago.
Lastly, the total US Gov and system-wide net debt is much higher (compared to GDP) than 20 years ago. We have substantially if not entirely consumed all ability to take on marginal debt.
Zach's position perfectly mirrors the reasoning used to bid up home prices over the last 10 years or so.
Oh, thank you Harry, I'm so relieved!
Just like subprime floating rate borrowers, everything A-OK for the USA until the current "teaser rate" resets......
so you want to keep interest rate at zero over the next decades?
Dumb
with all due respect to zac karabell you should be aware that during a period when financing requirements exceed available funds, as is the case today, the sheer amount as regards to soveriegn debt issue is more important than the ratios (amounts in relative value). the absolute amount of money required by the treasury is where zac's focus should be, rather than on some relative amounts of interest payments. TD has been reporting that over 600 billion was rolled over in april alone - one month! there is not enough money out there to satisfy just the roll over needs of the treasury.
More importantly, what is the capacity to sell debt. Rates are a factor, but only in a market with sufficient capacity to attract and sustain buyers. Sovereign debt is a sponge on the long end and leveraged by rates on the short. Either way its unsustainable without FED QE.
Mark Beck
Guess how bad it would be if Helicopter Ben wasn't buying all those Notes.....this is a game that will be lost huge...GOLD 5k and Silver $500 minimum is around the bend.... Obama needs to realize his mistakes and get Bennie and Timmy out of office quick and get someone in that can balance this mess or the USA is defunct and default.
It's so fascinating.
Fed commits to lend at the window for 0.25%, no strings attached. Banks don't lend, but instead but Treasuries at 3.75% for the 10-year, or so (probably shorter maturities). Only implied commitment: keep buying, no matter what, no rates stay low. If not, the game stops.
Were I a bank, how hard is this? Free money, risk-free 200 bp, and as long as we all keep playing, the band plays behind us.
Voila! Re-capitalized banks!
Blaise Pascal; Mathematician, Philosopher, Gambler
Hi Pascal,
Are you setting up any afternoon tea with Descarte and Poincare? Let me know
No, but I'll be working with Goldbach later this week. Poincare is solved, so less interesting.
Taking a musical diversion this weekend; Shubert and I will finish that symphony.
Join us.
I totally agree with that statement, but the stupid part is the banks aren't taking the losses. So they are still screwed in the end.
This is for HARRY, you see losses don't just disappear, you still have to take them, they still exist until written down or written off and our govt. has encouraged them to not do so. But that's bullish right?????
It's not a matter of being a bear or a bull but being realistic. How anyone can cheer consumer spending increasing is completely beyond me, it's much better to save and live well beneath your means than to spend like it's 1999 because at some point the regime changes, things change, the stimulus ends, the game ends and oh shit you didn't tell me that was the edge of the cliff. Of course again HARRY WAS THE GUY IN OCT 07 SAYING THE DOW WAS GOING TO 20K YOU BETTER GET IN. THE MARKET WAS SO FORWARD LOOKING THAT IT LOOKED RIGHT PAST THE START OF A DEPRESSION TWO MONTHS LATER. OH WISE MARKET YOU MUST BE RIGHT THIS TIME....RIGHT>!!!>??
Has this "money" any real value? So what that the banks have money? It's worthless confetti no value was added to the economy. Giving a 0% loan to buy the other's debt means fed=banks. This is no different than fed buying bonds directly. Seriously, is this not thinnly disquised monetization?
I don't think it's disguised at all.
I wonder how tha Bankster/Gangsters' bonuses equate when compared to what they make on the Fed/Treasury scam...interest we end up "paying".
Yeah, and the best criminal part of this scam is the average working stiff is going to have to pay off the 3.5% by working like a slave for years and years, while the freakin banksters are smoking $200 cigars at $1000 dinners with smoking hot paid for babes in each arm. What a great deal for the American public. This is a disgrace.
It's all coming from money owed us from Pearl Harbor, D-Day, the Berlin Airlift and the fall of communism. Oh and for Saturday Night Fever and Le Freak (c'est chique).
Who cares about debt, DJIA up 140+ today
Me thinks Hairy Wang'er - is using a Fed issued calcumonator...
Heh
Harry and yet credit creation was 4-14% twenty years ago, now it's negative. I love retards that pull up a number and don't put in context. For 1990, credit creation was 6.7% for the year 2009 negative. Sorry buddy.
Of course, Harry was the one that said the DOW would never go below 9,000 in Oct 2008 so no doubt... up and away.
"Seems we've been here before and we're still alive and buying iPads."
Actually we have been right here 5 times over the last decade or so. I would keep your DOW 10,000 hat for quite a while.
It was a "no brainer", yet you have missed badly.
So, we haven't made a principal payment against the national debt since 1960 and not likely to in the future...so all existing and new debt incurred will need to be serviced at whatever the rate at the time of issuance.
The real threat is that rates remain low and Tresury continues issuing at short end...this path will allow maximum issuance at low rates and ensure that any subsequent rate increase will cripple the government budget. (fed tax rev = $2t; assume debt of $15t somewhere in 2011; average interest @ 3% = $450b , 5% = $750b, 7% = $1.05t , 10% = $1.5t). And remember, it's not the 10yr that is incredibly cheap at 3.75% but the short end 5yr and down at historic low levels...and this is where we are doing all our borrowing (average T's now about 4yrs to roll over all debt). Check the link to see how low rates are vs. previous periods. http://www.usda.gov/rus/electric/rates/UEP-historical-frb-rates-090930.xls - go to first tab.
When short end rates return to normal (either because economy is reflating or lack of faith in fiat) the budget impact will be massive and well outstrip our GDP growth. Either austerity cuts are needed at that point to find some balance of services / interest payment or borrowing has to go parabolic(er) to fund programs and spiraling interest payments (of course this spikes rates and kicks off the Greek like death spiral).
I'd be really glad if someone could show me why I'm dead wrong (again) as this seems bleak and I'd much prefer to think there is an easier way out of this?
The Fed will find a way to "buy" the debt and turn it into PixieDust.
I say it again: Holy Flurking Shnit!!
My question is - what is the debt number at which it will sink in to the investment community that it can't be paid back? What is the total worth of all the land, buildings, machines, and other assets in this country? Is it $13 trillion? If we had to liquidate/turn over ownership of everything and we still couldn't pay back the debt, is that the number at which the game will end?
That being said, I can somewhat understand those who continue to spend. If you're on the Titanic and it's heading for the iceberg, why not order the expensive champagne. I think the thing to do is to put 1/3 of your money in gold and silver, keep 1/3 in cash just in case, and use the other 1/3 to do or buy things you've always wanted to while you still can.
i like this post, they stacked up $13 trillion to show what it looks like
http://buygoldsilver.org/2010/01/13-trillion-reasons-gold-is-the-place-t...
its just a mind-numbingly impossible-to-grasp-monopoly-money type figure.
13 Trillion nah... 70.7 TrillionFiatscos last year
From ShadowStats
Happy Accounting. The GAAP-based deficit from U.S. Treasury reporting — including the year-to-year change in the net present value of unfunded liabilities in various social programs — narrowed to $4.3 trillion in 2009, from $5.1 trillion in 2008. On a similar basis, total federal obligations as of September 30, 2009, stood at $70.7 trillion, up from $65.6 trillion the year before, with the 2009 number 4.94-times the $14.3 trillion level of GDP reported for the 2009 fiscal year. Other numbers are included in the summary table.
The numbers underreport the severity of the U.S. government’s fiscal circumstance. Even as reported, though, the numbers are not just unsustainable, they remain uncontainable. Taxes cannot be raised enough to put the annual results in the black, and the level of program slashing needed in Social Security, Medicare, etc. to reduce costs appears to be well beyond the scope of any foreseeable political will in Washington.
"Call one drop of water a dollar. Five drops equals one milliliter. Question: What is the volume of water of $14 trillion?"
Answer:
"Twenty times the volume of the Great Lakes. That puts the entire area of the United States 50 meters underwater."
http://www.atimes.com/atimes/Global_Economy/LB20Dj02.html
http://www.lewrockwell.com/rothbard/rothbard190.html
A golden oldie from Rothbard. It's like it was written yesterday.
Stiff the Chicoms, stiff the Limeys, stiff the Frogs and stiff the Hun and you've pretty much taken care of the debt problem. Launch the nukes, duck and cover and hope for the best as fortress America goes it alone.
@Catullus - haha brilliant, how quaint..
and 30 years later here we are again with 120 trillion or whatever it is.
really, nothing much ever changes does it?
Just change the numbers and it works. I wasn't for debt repudiation until I considered this. I'm sure the ones who contracted this debt would be scared if this article really got distributed.
Just remember: this is not "our" debt because "we" did not contract it.
Folks, HW hijacked a good portion of the thread and we have a discussion based on HW agenda. Ignore. Ignore. Ignore.
There are fewer Galaxies in the universe then these numbers...
(Still more Stars! 70 Sextillion ~ guestimation)
only 9 more zeros to go!
Heres the questions:
When does this occur
Outlays > Inlays + savings.
That is when everything stops.
Like everything els, we'll first see it in the CDS spreads.
how can the MSM neglect this??
Anybody seen anything that tries to somewhat credibly explain how we get out of this? I'm truly trying to understand the other side of what is possible?
People ignore reality because the US is too big to fail, until it does.
Thyer's always a siren singing you to shipwreck.
Don't think for a moment that the Treasury and the White House will send Democratic Congressman on an electoral Bataan death march. As much as Team Obama and Congressional leadership have been willing to sacrifice vulnerable members to ram through legislation, they'll decide they need at least a few reps in Congress next year.
Look for the Treasury to use every accounting trick in the book to keep the debt below the ceiling, even if that means giving Andy Fastow a full pardon and bringing him onto the team.
The debt subject to limit only has to average an $250 bil a month increase for May-Oct. to go over the limit. And we all know it will average much more than that.
Also, looking at the end of month DTS for Jan., Feb. and March, the lowest Treasury bill redemption was for Feb. Which was still $338,443,000,000. So far, CALENDAR YTD (Jan.-April) the Treasury has had $1.7 Trillion in Bill redemptions!
Now just imagine what's going to happen when the short end goes up 300+ bps!
The ultimate adjustable rate mortgage!
I bet they dont wait to raise ceiling in Nov. during mid-terms. Thats a death warrent for demos. I think summer time is when they'll annouce.
Currently, SP500 futures indicate that the March 2009 bear market rally may be ending. We should get confirmation this week.
MARKET UPDATES:
http://www.zerohedge.com/forum/latest-market-outlook-0