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Goldman's Take: "Clear Possibility That Final Resolution Might Not Be Reached Until Shortly After October 17"
Confused by what is going on in Washington? That's ok - everyone in Congress also is. So here is some much needed clarity from the puppetmaster himself: Goldman Sachs.
From Goldman's Alec Phillips
Visibility on Debt Ceiling Increases But Resolution Unlikely Before Next Week
The debt limit deadline looks increasingly likely to be pushed off with a short-term extension. It looks less likely that the partial federal shutdown will be ended with the extension, but this is still unclear. There is still some uncertainty on the path to resolution over the next week, but the fact that both parties have accepted the notion of a "clean" extension reduces the risk of the Treasury's missing scheduled payments due to the debt limit.
1. Visibility on the path forward on the debt ceiling has increased. We noted in last week's US Economics Analyst that a short-term extension was becoming more likely as the political focus shifted to broader fiscal discussions that would take additional time to resolve. This now appears to be the most likely scenario. The probability of a short-term extension appears high, since most of the parties involved, including the White House and House Republicans, seem willing to accept or at least have not explicitly rejected a short-term approach as a means to avoid next week's deadline.
2. While visibility has increased, there is still some uncertainty regarding the path forward. (1) A short-term extension is the preference of Republicans, not Democrats. That said, neither the White House nor most congressional Democrats have said explicitly they would block a "clean" short term extension. (2) It isn't clear whether at some point during the process Republicans will seek other policy changes; as we understand the House bill, it does not seek any other policy concessions but may establish a House-Senate conference committee on budget negotiations. Depending on the details, this could prove to be a sticking point. (3) Democratic support will be needed to pass the bill in the Senate and probably in the House, and it is not clear whether Democrats will support a debt-limit extension that does not include a reopening of the government. While Democrats would prefer to resolve both issues together, after taking the position that no conditions can be tied to a debt limit extension, it may be difficult for them to reject an extension solely on the grounds that it does not also reopen the government.
3. The House looks likely to take up a bill to suspend the debt ceiling for six weeks. This looks similar to what was passed earlier this year. The bill would suspend the debt limit until November 22. However, as we understand it, unlike the last extension, the House bill would specify that the "extraordinary measures" used to create additional headroom under the debt limit could not be replenished. This would mean that as of November 22, the situation would reset to roughly the same financing situation the Treasury would have faced on the current deadline of October 17, when the Treasury expects to be constrained by the debt limit and could rely only a projected $30bn cash balance to make payments.
4. The shutdown looks less likely to end soon. We noted last week that there was a 30% chance the shutdown would not end when the debt limit was extended, and following the Department of Defense's decision to bring back most employees we noted that the announcement increased this probability. It appears to have risen further now that the House plan excludes a "continuing resolution" to fund government operations. This implies that the shutdown could last for a while longer, though this will remain uncertain until the final version of the debt limit extension is actually agreed upon over the next week or so.
5. No final resolution seems likely before next week. Congress had been scheduled to leave for a weeklong recess after October 11, but this has been canceled. The House may vote on its short-term debt limit plan later today or tomorrow. Republicans hold 232 seats and 217 votes needed for a majority, so Republicans can lose only 15 votes from their own party and the vote tonight or tomorrow could be very close unless Democrats support the measure. The Senate is likely to vote on Saturday a different plan offered by Senate Majority Leader Reid (D) to suspend the debt limit through 2014. That procedural vote would require 60 affirmative votes to clear, meaning at least 6 Republicans would need to support it. If the House bill passes today or tomorrow, the Senate bill to extend the debt limit for one year looks unlikely to clear the 60-vote threshold necessary. If the House bill fails, however, the Senate approach could gain momentum. If the Senate's one-year extension fails and the Senate takes up the House bill, the key question will be whether the Senate adds a "continuing resolution" to reopen the government. If this is added, the House would then have to vote once again on the modified version, but would presumably have to rely on more Democratic votes and less Republican votes than when the 6-week extension comes up for a vote in the House tonight or tomorrow. In our view, the developments over the last day reduce the probability of "tail risk" scenarios that would result from going far past the deadline, but there is still a good chance that Congress will run up to the deadline before reaching a final resolution and there is a clear possibility that final resolution might not be reached until shortly after October 17.
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what dog shit, government backed, hallucination
are they selling today?
http://www.youtube.com/watch?v=RT9FfECB8A8
http://www.youtube.com/watch?v=RT9FfECB8A8
BBC's Surviving Progress (2011) HDTV
BBC's Surviving Progress (2011) HDTV
Between their never ending deceit and amazing incompetence, I don't think it is safe to believe, much less act, on anything Goldman Sucks spews forth.
the risk of the Treasury's missing scheduled payments due to the debt limit.
You mean ZERO risk? Because there's zero risk of that unless the treasury commits treason and defaults on the debt... since there's plenty of money to pay for it.
Republicans continued "Federal Government shutdown" coupled w/ their unanimous consent to pay all furloughed Federal employees is fucking retarded!!! Either send 'em back to work so they can keep fleecing us or don't fucking pay them...but don't tell em not to work and then pay them for it...oyyyveeee.
Plus, I was thinking of going down to Yosemite for the weekend but don't know if I can get past the 500 miles of baricades and police tape they've put up around the park?!>
Maybe its time for a "final solution" to the Federal Reserve question.
With Yellen coming up? WHo doesn't understand they will just keep printing and pay the bills till BRICS stop buying. Then the FED will buy all of the bills and bonds and this will go on until the dollars all over the world get shipped back as they no longer need or want them and that could take a couple of years. This party will go on and this secretly controlled goverment will keep the show rolling for all the sheep to watch and stay scared.
And what's not to be scared of? Militarization of the police, NSA, Billions of bullets for DHS, weird unexplained stacks of coffin like boxes, FEMA Camps, obvious corruption at the highest levels of government, invading countries and dissapearing people at will, Georgia Guide Stones, the FED printing uncontrollably. all this stuff can and will continue till it achieves the desired effect. Complete feudalistic control of the masses and a perfectly bifurcated society.
As long as a single sheep has a hair left on it there's plenty of shearing yet to be done.
My favorite Banzai image
http://farm4.staticflickr.com/3826/9827898295_a16f8b64ac_o.png
Agreed. Better than his periodic chart of criminals. I LOL'd when I first saw it. Soon to become an instant classic!
Indy - we are already at the point of the Fed buying all Notes and Bonds...they will soon own up to their 70% limit of the entire $4 T of 1 yr and longer debt (they already own $2.2 T and keep on buying $45 Billion a month in Treasuries...far in excess of what the Treasury is issuing in longer dated Treasuries...of course they have no debt in the $7 T Bill market)...forget the $5 T in intragov debt cause it will always get rolled by the gov. So the Fed only has to worry bout the $12 T public debt...and how...focus QE entirely on the smaller, slow rolling long end...
Think of it this way - think of the Note and Bond (plus TIPS) as a $4 T market of which the Fed already owns 55% - they continue to buy the Note / Bonds at about 150% of issuance...this tells you they are buying the rollover debt on top of new issuance.
Did I mention there is no market but the Fed???
When G. Sachs talks, Congress listens.....contact your G. Sachs representative today
Ted Cruz's wife?
The United States no longer has a "government." We have a communist politico party in the White House which is set on creating the kind of Maoist "cleansing" of anyone who doesn't agree with the 2% solution. What is the 2% solution? 2% of the population is gay but one dare not disagree with them or you are treated to the kind of pilloring that is Exactly what they say they don't want you to do about Their lifestyle, ie, how dare you not approve and allow them to perpetuate, promote, and legalize Sodom and Gommorah.
The 2% solution continued: 2% of the population of the United States is now Muslim. And yet, my local government just decided to allow public facilities to be off-limits for the general population in order to accomodate the Muslims. Last time I checked, my taxes paid for that facility and I should not have it off-limits to me because of religious discrmination against non-Muslims.
Too, all should be aware that the Muslim position on women is to kill them should they not adhere to the standards that Muslim men set. Therefore, we are allowing into the US, under the guise of "freedom," a group of men who are committed to denying women the full rights of the US Constitution and who will actively and agressively discrmiinate against women. That they are committed to our demise as per the Koran is self-evident. Who let's into their country those who are self-stated destroyers of them?
We have become so stupid in the US that we seem to have no sense at all. Reminds me of the movie The Body Snatchers (1970s version with Sutherland, or was it 1980s? whatever). Your opponets point their finger at you and let out a scream and Americans run for the hills. They say you discriminate if they can't have it your way, the American Christian way, and you fold like a cheap suit.
My dad was a WWII vet, and if he saw the welfare society of cretans shopping at Walmart with tax payer subsidized dollars, the endless stream of welfare babies used to terrorize the productive into turning over their dollars, the endless and soul corrupting "compassion" (after all, if you aren't "compassionate" by "giving" your productivity to the sloths, you are a very bad person), and the endless demands from every website you go to to "give" or that they "give" you must be pounded down.
So as we move to that holiday season, tell your retailers you will give through your church and your community organizations as you please. You would rather have a lower price rather than a price that builds in self-serving and blackmailing "giving", "compassion", and taxes that are redistributed.
Give America back to the productive, stop all immigration and those dang H-visas that allow foreigners to have our jobs. And while your at it, demand that every publicly supported university and college cut the pay of the president/administrators by half and stop all foreign students (20% at the major university in my state) and 50% of the graduate program spots given to foreign students. These are OUR UNIVERSITIES taxed to us and paid for by us For Our Children. First, last, and always.
Seal Team 6 will soon be called in to pay a visit to Tea Party Extremists. They've fixed the silent helicopter so it does not crash.
How does a minority take hold of the political process, that's not how our Democracy works ...
Wait a second ... I think I can think of 1 or 2 minorities who control the political process ... let's start with the 1%
And then ...
http://www.treasury.gov/initiatives/pages/debtlimit.aspx
Debt Limit
The debt limit is the total amount of money that the United States government is authorized to borrow to meet its existing legal obligations, including Social Security and Medicare benefits, military salaries, interest on the national debt, tax refunds, and other payments. The debt limit does not authorize new spending commitments. It simply allows the government to finance existing legal obligations that Congresses and presidents of both parties have made in the past.
Failing to increase the debt limit would have catastrophic economic consequences. It would cause the government to default on its legal obligations – an unprecedented event in American history. That would precipitate another financial crisis and threaten the jobs and savings of everyday Americans – putting the United States right back in a deep economic hole, just as the country is recovering from the recent recession.
Congress has always acted when called upon to raise the debt limit. Since 1960, Congress has acted 78 separate times to permanently raise, temporarily extend, or revise the definition of the debt limit – 49 times under Republican presidents and 29 times under Democratic presidents. In the coming weeks, Congress must act to increase the debt limit. Congressional leaders in both parties have recognized that this is necessary. Recently, however, a number of myths about this issue have begun to surface.