Santelli Sums It Up In 10 Words: "Debt Ceiling Is Not The Problem. Debt Is The Problem"

Tyler Durden's picture

Since the 2nd Liberty Act of 1917 birthed the debt ceiling, due to issues financing USA's entry into World War I, CNBC's Rick Santelli notes that there has been many documented 'violations'. However, as Rick so vociferously points out President Obama's comment yesterday on the debt limit and highlights the fact that "to have an unlimited amount of money to call upon is too much power power for one person. It's always in our country been about checks and balances but I think this administration just wants more checks and no balancing of the checkbook." Rick is right, of course, and the current diatribe from Geithner and Obama yesterday on the possible 'removal' of the debt limit beggars belief - and yet has become a negotiating point to be 'traded'. While some argue the premise of the debt limit for a reserve currency nation is nonsense, Santelli sums it perfectly in ten little words: "Debt Ceiling Is Not The Problem. Debt Is The Problem," adding the debt ceiling, as we have pointed out regularly, is an important (perhaps the most important) issue facing us currently (and inseparable from the supposed 'austerity' of the fiscal cliff - lower spending growth not lower spending).



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hedgeless_horseman's picture



The law is not the problem, the lawmakers are the problem.


You first, Mr. President.

Start with a 50% tax on all bribes campaign contributions.

I'm starting with the man in the mirror
I'm asking him to change his ways
And no message could have been any clearer
If you wanna make the world a better place
Take a look at yourself and then make a change.

boogerbently's picture

The morons in Washington CAN'T think for themselves, but in this case they don't need to. All they need to do is look at Greece.

DoChenRollingBearing's picture

The debt and the lawmakers are both our problem, different sides of the same coin.  Debt IS a huge problem, I thank Rick Santelli and Tyler Durden for rubbing our faces in this.  If debt is such a huge, yet intractable, problem, then what is the solution?  Hint: it ain´t from Washington.

The solution is physical gold.  Look out for No. 1!


Quality bearings outside of the USA run a close second!

eatthebanksters's picture

Whatever happened to the pledge of no lobbyists in his adminstration?  How about transparency?  And then what about not accepting any SUper Pac campaign money?  And how about no earmarks?. Yadayadayadayada...habullshit!

SheepHerder's picture

How is physical gold or silver a solution?  

The majority holder of physical gold is banks and soverign banking institutions which last time I checked are greedy, corrupt and self-serving.  Even if we went back to a gold backed currency, the banks will largely control the currency and the accounting of the currency to gold ratio.  Not to mention the amount of gold you and I can amass compared to bankers who can pretty much print money to buy physical gold, pales in comparison in gold ownership.  Surely no one thinks normal everyday American citizens own more gold and silver than the banks, right?

If you and I woke up tomorrow and gold was the currency, would the banks and politicians be weaker or stronger in terms of power?  If it's stronger, then the same headaches we are currently dealing with will exist.

I imagine Blankfein, Diamond, Bernanke and friends would still be in control of the currency.  Such honorable men they've proved to be in recent years.  It seems the problem is an ethical one.  Too much corruption, selfishness, deceit, etc. and few with the means to stop the most powerful of the corrupt, selfisn and deceitful from running the country into the ground.  Until those people are "replaced" it doesn't matter what you use for a and silver included.

In fact it seems like switching to a gold/silver backed currency would cause more problems.  The rich and powerful would be unscathed.  However you and I would have to sit out the window with assault rifles to ward off everyone who wasn't in the know in purchasing gold and silver and is now using any means necessary to feed little Johnny and Sara for dinner.  Sounds like an amazing society.  

However if you and I "replace" the bankers and friends, steal their wealth, redistribute it (yes I sound like a commie) to the masses, you come out with less of a "assault rifle in the window to pick off neighbors" scenario.  

The gold and silver dream is a farce because it doesn't address the root problem, which in my opinion is that the political and banking system represent their own interests rather than that of the people.  Switching to a gold and silver backed currency does not diminish their power, but likely strengthens it due to who owns a majority of gold and silver.  Unless the root problem is addressed, it doesn't matter if toilet paper is the new currency.   

RockyRacoon's picture

To each his own, SheepHerder.  It's not a matter of being on top of the heap, it's just about being able to crawl out from under the pile... and survive.   I'll never have enough PM to battle anyone or anything, but hopefully I can accumulate enough to save my wealth throught the coming turmoil.  I rarely agree with Gartman, but he says that gold is a currency and one can do better trading it with that concept in mind.  If it's a good trading strategy, why is it not a good wealth preservation strategy as well?

BTW: Your use of the circle and triangle is a bit unsettling.   (FOB 22 years.)

SheepHerder's picture

Perhaps it is a good wealth preservation strategy, but it fails to address the root problem or offer much hope to society as a whole.  Nor does it dress society's main problem, which IMO is a spiritual malady as a result of selfishness and self-centeredness.  Almost seems like most of our problems are an addiciton of sorts to materialism and money that have replaced our ability to connec to each other and something bigger than ourselves.  But that's just my opinion based on experience...

BTW: I just thought my icon looked cool being closely related to Solomon's Seal and all.

monogratis's picture

Sheepherder. Fractional reserve banking can only be safely limited if money is backed by some sort of real asset, not paper.  Gold, silver, and precious metals fulfilled an important function that most people don't belive matters anymore, which is that currencies should be valuable in and of themselves, not because the government points a gun at our head and says so.


 A ponzi scheme is a ponzi scheme and it doesn't matter if you put Jesus Christ in charge of running it, it will still collapse... you can rearrange deck chairs on the Titanic and its' not going to make a difference.  You don't drive your car down a hill without brakes...I could go on with this for a while...

DoChenRollingBearing's picture

FOB 67 days, Rocky...

at SheepHolder, I was talking about each of us as individuals owning gold to get us through this.

RockyRacoon's picture

Well now, that's great.  Really.

johnnynaps's picture

Agreed! The same idiots that are causing all of our problems will maintain control with the mad max gold scenario. Call it kicking the can down a different road.

Hobbleknee's picture

The difference would be that they couldn't print gold to fund all their wars and crazy, wasteful programs.  They would be shackled to the ground.

redpill's picture

And make sure Guam doesn't tip over.

prains's picture

laws are being swiss cheesed by the corptocracy lobbyists to the point they are unenforcable even if there was somebody with the stones to use them, everything has a back door aka the "WTF Global" clause

pods's picture

"Shit, she's gonna know I'm stoned. Do my eyes look red to you?  Do you have some Visine?"

TruthInSunshine's picture
 Choom Gang

Unlike Bill Clinton, Barack Obama never tried to say he didn’t inhale.

In his 1995 memoir “Dreams from My Father,” Obama writes about smoking pot almost like Dr. Seuss wrote about eating green eggs and ham. As a high school kid, Obama wrote, he would smoke “in a white classmate’s sparkling new van,” he would smoke “in the dorm room of some brother” and he would smoke “on the beach with a couple of Hawaiian kids.”

He would smoke it here and there. He would smoke it anywhere.


Say would you, could you, with a mouse?

Yes, in a house

With a mouse

In a box

With a fox

On a train

In the rain

In a tree

You will see

Seer's picture

LOL!  The same guy who ran around saying that he wasn't going to accept PAC money?`(initial campaign)

ratso's picture

Leave it to Santelli to dramatise a truism.  

smoot27's picture

It might be a truism if greater than 50% of the country thought logically.  As made evident by the election, this certainly isn't the case.

Seer's picture

Truth cares not whether even a single person believe it, truth is self-supporting.

Diogenes's picture

Or if the President did. "the debt ceiling is only good for ruining our credit rating".

No, the debt will ruin your credit rating. The debt ceiling was supposed to stop you ruining your credit rating.

How can anything change when this kind of Bizarro World thinking is in charge?

RockyRacoon's picture

Is it just me or is Santelli becoming a bit irrelevant?  Can't put my finger on it, but all his "solutions" are pie-in-the-sky stuff that will never happen unless there is a total reset.   Sure, that could be his goal, but he comes off as a shrill theorist, not the practical guy he used to be.   I can agree with nearly all of what he says but I see no way to actually get there without a lot of blood in the streets.   On second thought....  Sounds good.

chubbar's picture

This is OT, kind of. Antal Fekete has an article out explaining the death of the Silver standard. He believes that over 100 years ago an "international banking cartel" deliberately sabotaged the silver standard, clearing the path for the current debt system. Very interesting read as he isn't a tin foil guy at all.

Seer's picture

Humans being deceptive, scheming to obtain more power?  No, say it ain't so!

otto skorzeny's picture

I couldn't remember if it was spooks or vampires that you couldn't see in a mirror-this answers it

LongBalls's picture

Let's get this party started.

are we there yet's picture

50% tax rate on all lawyers with income above $100,000. 60% on all lawyer income in Washington.

game theory's picture

Fraud and crony capitalism are problems too.

pods's picture

Debt is not only the problem, it backs our currency!


El Hosel's picture

No shite, we went over the fiscal cliff and off the fiscal reservation many Trillions of Dollars ago....

Now  suddenly the dusty old debt problem is just one "deadline or headline away from disaster"!....  Its made for TV propaganda played out to perfection  so they can "avoid the disaster" and rally the markets to new highs for the Holidaze!

johnnymustardseed's picture

"Reagan," Vice President Dick Cheney famously declared in 2002, "proved deficits don't matter." Unless, that is, a Democrat is in the White House. After all, while Ronald Reagan tripled the national debt and George W. Bush doubled it again, each Republican was rewarded with a second term in office. But as the Gallup polling data show, concern over the federal deficit hasn't been this high since Democratic budget balancer Bill Clinton was in office. All of which suggest the Republicans' born-again disdain for deficits ranks among the greatest - and most successful - political double-standards in recent memory.

Bob Sacamano's picture

Republicans increased the debt, but no one over the past 200+ years has come anywhere close to the BHO record on debt creation.   It is not the percentage increase that matters, it is the absolute dollar amount of increase.  

johnnymustardseed's picture

Because BHO told the truth about the costs of the wars he is bad? Bush hid the cost of two wars off budget.

Raymond K Hessel's picture

Demopublicans and Republicrats....

Now I know the meaning of the phrase, "Who gives two shits?" 

As in, "Hey, johnnymustardseed.  Who gives two shits about who did what when?  We're fucked equally."

Seer's picture

It's all explainable via an understanding of the exponential function.  The better way of measuring all of this is by looking at time speeding up: everything is coming faster and faster.

During Clinton's rule the bubble that Greenspan was brewing allowed the budget deficit problem to be masked.  While things could have been made worse, things certainly could have been made MUCH better by operating as though the windfalls brought in by the big financial churns weren't going to last forever.  Sigh, no one wants to pull away the punch bowl when the party's going strong.

The "parties" all cater to the same powers.  As demonstrated, talk is one thing, actions another: and the actions by BOTH clearly indicate that their talk is meaningless (the talk is just the storyline handed to them by TPTB).

pods's picture

Precisely Seer.  The function's slope is increasing so every "last administration" looks better and better.
When in reality, it has little to do with policy or politics.

If the debt needs increasing, the federal gov is the borrower of last resort.


Diogenes's picture

You mean some day Obama will look good, compared to what comes after him?

Scary thought but I'm afraid you are right. Who ever thought we would miss Clinton, or Reagan?

Everybodys All American's picture

... I lived through the Clinton administration and if not for the contract with America and Newt Gingrich insistence on a budget a lot of if not all of Clinton's economic success would be nil. He was brought kicking and screaming to the table of balancing the budget as well as welfare reform.

The reality is that both sides need to compromise. Clinton was not a demagogue and Obama is the opposite of Clinton in so many ways.

Seer's picture

Not only does it back the USD, but debt IS money!

Santelli is right, but someone needs to point out to him that DEBT IS MONEY!  It's the fucking System!

One cannot cast rocks at only the public sector.  After all, the public sector is mopping up the private sector's debt in order to keep loan defaults from wiping out DEBT, which would wipe out the System.

"Fractional banking," perpetual growth on a finite planet.  This is the stuff of pure insanity.  When folks struggle to figure out what's wrong it's because the PREMISE is WRONG!

pods's picture

It has been the way of things for so long that not 1 in 100k people understand the concept.

Henry Ford had it right:

"It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning."


Seer's picture

And, sadly, as revolutions always end up, the lesson of growth never is learned. The reason being is that those leading the "revolution" only want to insert themselves into power, and supposed changes to "the system" are no more than elements of selling in order to get a buy-in for recognizing the "new" PTB as THE-PTB.

"Do people demand a really just system? Well, we'll arrange it so that they'll be satisfied with one that's a little less unjust ... They want a revolution, and we'll give them reforms -- lots of reforms; we'll drown them in reforms. Or rather, we'll drown them in promises of reforms, because we'll never give them real ones either!!"

- DARIO FO, Accidental Death of an Anarchist

"As to the history of the Revolution, my ideas may be peculiar, perhaps singular. What do We Mean by the Revolution? The War? That was no part of the Revolution. It was only an Effect and Consequence of it. The Revolution was in the minds of the People..."

- John Adams

"La Revolucion is like a great love affair. In the beginning, she is a goddess. A holy cause. But... every love affair has a terrible enemy: time. We see her as she is. La Revolucion is not a goddess but a whore. She was never pure, never saintly, never perfect."

- Jack Palance, as 'Jesus Raza', in, 'The Professionals' (1966)

Radical Marijuana's picture

Yes! The comments by pods and Seer are RIGHT!

THE Problem is the money-as-debt system! A deeper problem is that the reason that system exists is that it is basically the result of the triumph of organized crime taking control of the government, by reducing almost all politicians to puppets. The history was bribery and intimidation, and assassination when those were not enough to control the political processes. Therefore, bit by bit, more and more, faster and faster, the current system was developed as the runaway triumph of organized crime taking control of the government.

I like the part when Santelli demonstrated that checks and balances have been reduced to all checks, with no balances. That has been the result of the public political processes gradually being taken over by a shadow government through triumphant organized crime. However, on a deeper philosophical level, the problem is that virtually all of the controlled opposition likes to present nice sounding theoretical solutions which deliberately ignore the central role of the real problem, namely, money is backed by murder.  The only way to sufficiently understand the real problem is to face the fact that any politicians that could not be controlled by being bribed or intimidated were then discredited or destroyed instead. Furthermore, any attempts to actually fix the real problems run into a head-on collision with those basic facts still being the problem, except now on an astronomically amplified scale than they were when those problems first started to become runaways ...

Unless the public was willing and able to go through enough of the political science paradigm shifts necessary, then they could not understand the monetary system, and could not effectively change it in revolutionary ways, which are the only ways which would be sufficient. As people like President Jackson also stated, as Ford later did, IF the people understood the monetary system, there would be a revolution. However, actually UNDERSTANDING the monetary system is something way more profound than to merely understand the superficial structure of that! Furthermore, the necessary revolution is way, way more profound than to change that superficial structure, and especially far more profound than ideas about changing that superficial structure of the monetary system back to being something like it was supposed to be in the past.

In fact, the most probable future is NOT an adequate enlightenment of enough of the American people to cause a Second American Revolution to take back power over the monetary system ... The most probable future is for the established runaway debt insanity to result in psychotic breakdowns that destroy America, and reduces it to something which we can not yet imagine, since it is the result of an uncontrollable collapse into chaos.

The basic rule of law, and checks and balances, are all breaking down before us, at an exponentially accelerating rate, while those in power only respond by causing that to happen even more, as their "solutions" to those problems. However, the destruction of the rule of law, and the destruction of checks and balances, will reach a point where the whole system will fly apart, and become ungovernable any more ...  Nobody now knows when and how that will happen, nor what will be the result of that happening ... However, there are no good reasons to disbelieve that this runaway debt insanity situation could have any other outcome.

The problem with the collapse into chaos is that the return of reality, within the context of the runaway triumph of frauds, backed by force, having made and maintained the current systems, then means that the implicit death controls behind the debt controls will become much more manifested, as those are the real checks and balances, which will emerge from the bogus systems of frauds finally going through their necessary corrections via psychotic breakdowns of their runaway triumphant frauds.

America has become a country totally controlled by huge lies, backed up with violence, which can never make those lies become true, but which could only make the established systems of runaway triumphant frauds grow to astronomically amplified sizes. The "market corrections" we are talking about here are NOT within the established systems, but rather are the psychotic breakdowns of those systems.

Timmay's picture

Our Republic is in perpetual crisis.

hedgeless_horseman's picture



"Oceania has always been at war with England, Injuns, France, Spain, Mexico, Ourselves, Spain, Italy, Germany, Russia, Japan, USSR, Korea, Vietnam, Grenada, Panama, Libya, Iraq, Islam."

Seer's picture

Oceania has always been at war FOR RESOURCES.  All wars are about resources.  Countries and ideologies are just part of the marketing campaign to hide this underlying animal response.

Radical Marijuana's picture

Yes, but control over resources comes from control over money. Control over resources primarily became control over the power to make money out of nothing, as the symbolic way to rob resources. Control over the supply of resources became control over the money supply.