Debunking Government’s Justification for Mass Surveillance
Apparently the IRS has fallen on hard times in light of all this government shutdown and sequestration nonsense. Too bad. According to a recent report from the Treasury Department, ‘enforcement revenue’ at the IRS has fallen for the second straight year. Tax enforcement is one of the only ‘money makers’ for the US government; according to the IRS, every dollar spent on tax enforcement generates six dollars in additional tax revenue. Unfortunately for the IRS, though, the agency’s head count has been thinning. They no longer have enough people, and enforcement revenue has been declining. Ordinarily the IRS supplements its ranks with legions of unpaid spies in the financial sector. Starting July 1, 2014, though, the Foreign Account Tax Compliance Act (FATCA) will give the IRS a new addition in its ever-growing list of unpaid spies. You.
Senate Majority Leader Harry Reid and Senate Minority Leader Mitch McConnell will soon announce an agreement to reopen the government and avert default on U.S. debt, Politico reports, according to several sources familiar with the talks. Here is what that "stunning reversal for the speaker" deal looks like. In short: the can has been kicked for three months, to early February.
Equity investors can't buy enough this morning. The latest rumor - that the House Republicans are willing to consider voting first on an emerging Senate proposal - provided some fillip to an opening selloff. As Politico reports, this move could expedite bipartisan legislation developed by Senate Majority Leader Harry Reid and Minority Leader Mitch McConnell. If the House passes the bill first and sends it to the upper chamber, it would eliminate some burdensome procedural hurdles in the Senate and require just one procedural roll call with a 60-vote threshold needed to advance the bill toward final passage in the Senate. Of course, the big question here is "If" the House passes the bill...
Over-burdensome regulation and massive liability exposure is stifling business and creativity, slowing the flow of capital globally and stagnating economic growth.
With the House, as previously reported, now out of the debt ceiling negotiations, it is all up to the Senate to reach some compromise with 4 days until the midnight of the first X-Date. Unfortunately, or maybe fortunately, at least going into Monday, there is no deal, and not even a glimmer of what a potential deal may look like. Yes, Democrat leader Harry Reid did said on Sunday that he had a "productive conversation" with Senate Republican leader Mitch McConnell on efforts to reopen the U.S. government and raise the federal debt limit, Reuters reports, but that's as far as it gets. "Our discussions were substantive, and we'll continue those discussions. I'm optimistic about the prospects for a positive conclusion to the issues before this country today," Reid said in remarks on the Senate floor. He did not provide any specifics of the conversation. Democrats and Republicans remain divided over spending levels in any temporary government-funding measure.
Normally Treasury Bills are not something discussed around the dinner table or hotly debated on the business news channels. As UBS notes, the fact that the Tbill market has become the focus of attention is an ominous sign, and indicates that the stalemate over the debt ceiling could have profound effects. While TED-Spreads, and financial CDS were the key indicators in 2008, now we must watch money fund flows, and Tbill forwards. In a sense, the Tbill market is the proverbial canary in a coal mine for the US financial system. The canary is not yet back in good health.
Pulling from an extensive record of public speeches and FOMC meeting transcripts, Goldman Sachs reviews Fed Chair-nominee Janet Yellen's views on a number of policy-relevant issues.
The Treasury Department has warned that the continued failure by Congress to raise the debt ceiling would leave the United States unable to pay all of its bills and may force the country to default on its government bonds. Here are some helpful answers to the most common questions about the debt ceiling crisis...
A plausible debt ceiling agreement is finally on the table, but BofAML doesn't expect a deal until next week or later.
Here's where we stand...
Curious why algos suddenly are buying because other algos are buying because other algos are buying, pushing the S&P higher by 10 point in virtually no time? Simple. It appears at least one vacuum tube decided to scan the news archive, and fell upon the Politico story from 7 AM Eastern which said that the Republicans and Democrats had met in a secret meeting.
As we have discussed previously, the "partial government shutdown" that we are experiencing right now is pretty much a non-event - especially with the un-furloughing of The Pentagon. Yeah, some national parks are shut down and some federal workers will have their checks delayed, but it is not the end of the world. In fact, only about 17% of the federal government is actually shut down at the moment. This "shutdown" could continue for many more weeks and it would not affect the global economy too much. On the other hand, if the debt ceiling deadline (approximately October 17th) passes without an agreement that would be extremely dangerous. A U.S. debt default that lasts for more than a couple of days could potentially cause a financial crash that would make 2008 look like a Sunday picnic. If a debt default were to happen before the end of this year, that would bring a tremendous amount of future economic pain into the here and now, and the consequences would likely be far greater than any of us could possibly imagine.
"Neither the Treasury Department nor the Federal Reserve believes that the law can or should be used to facilitate the production of platinum coins for the purpose of avoiding an increase in the debt limit" Anthony Coley, spokesman for the Treasury Department.
The BPC, whose initial analysis of the US default has become the staple "go-to" analysis for Treasury cash obligations and key events in the day surrounding and following the X-Date, has released a new update on when the US runs out of money. The latest: October 22 - November 1. Which means that if it so desires, the GOP can and probably will delay a debt ceiling bargain until the last possible moment which may well be, appropriately enough, Halloween. In the meantime, the US Treasury now has about $40 billion in total cash on hand and available extraordinary measures and declining fast.