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Jack Lew Rains Fire And Brimstone Over Debt Ceiling Impasse - Live Testimony

Tyler Durden's picture


Nearly exactly five years after Hank Paulson appeared before Congress dangling a 3 page term sheet ultimatum warning it was his way or the apocalypse, it is time for the sequel. Since we all love the smell of a good Mutually Assured Destruction spectacle in the morning. Which is why we can't wait for Treasury Secretary Jack Lew's presentation before the Senate Finance Committee discussing the Debt Limit, in which he will rain fire and brimstone on anyone who suggests that the Treasury can enter the X-Date without a debt ceiling deal in place, and will most certainly seek to crucify anyone who points out the logical, namely that payments can be prioritized and interest expense is a fraction the revenue the Treasury brings in, and that the end of the world would be nigh should the US actually be forced to live within its means.

Watch Lew's testimony live below (or if not webcast not showing, use C-Span link)

The choice fire and even more choice brimstone from Lew's prepared remarks (below):

If interest rates rose, it would have a real impact on American households. The stock market, including investments in retirement accounts, could tumble, and it could become more expensive for Americans to buy a car, own a home, and open a small business.


These additional costs of borrowing could not easily be undone and our actions would impact Americans for generations to come.


Failing to raise the debt ceiling will impact everyday Americans beyond its impact on financial markets. For example, doctors receiving reimbursements under Medicare would likely continue to provide services on a timely basis, but they would be operating with significant uncertainty about when they would be paid by the government for their services. For millions of low-income Americans who rely on Medicaid for their healthcare, the federal government’s payments to states for the federal contribution would likely also be impacted. These providers still have to pay their doctors, nurses, and staff, but absent timely federal payments, many could face real liquidity challenges. And for those waiting on benefits who need those funds in order to refill their refrigerator – if that money doesn’t flow, they won’t go to the grocery store to shop, creating ripple effects that would be felt throughout the economy. The bottom line is that failing to raise the debt ceiling creates a very difficult and unfair situation, and one that is completely avoidable if Congress acts.


It is also important to note that the federal government has numerous large payments that are due shortly after October 17, when we will have exhausted our borrowing authority and will only have cash on hand to meet our obligations. Between October 17 and November 1, we have large payments to Medicare providers, Social Security beneficiaries, and veterans, as well as salariespayment of all of these at risk.


We need to look no further than 2011 for evidence of what just an extended debate on the merits of raising the debt limit can do to our economy. In 2011, U.S. government debt was downgraded for the first time in history, the stock market fell, measures of volatility jumped, and credit risk spreads widened noticeably; these financial market effects persisted for months. To be sure, other forces both at home and abroad also played a role, but the uncertainty surrounding whether or not the U.S. government would pay its bills had a lasting impact on both markets and the economy.

Lew's full prepared remarks below (link):

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Thu, 10/10/2013 - 08:14 | 4040813 involuntarilybirthed
involuntarilybirthed's picture

The sky is falling.     

Thu, 10/10/2013 - 08:37 | 4040847 lolmao500
lolmao500's picture

If the markets believe it so and act on it, it'll be a self-fulfilling prophesy.

After all, 90%+ of the markets are ``sentiment`` and has nothing to do with reality.

Markets are like a woman, it doesn't care about facts, only what it feels. And if they are truly in the mood, they will fuck up your shit just for the hell of it.

Thu, 10/10/2013 - 08:40 | 4040881 spastic_colon
spastic_colon's picture

this is all about the twitter IPO....cant IPO into a weak market and let icahn, hollywood and congress to cash out without making some serious dough / s


gotta get spending sentiment up as well, so they can start releasing the made up retail and employment numbers again for the holiday season.

Thu, 10/10/2013 - 08:57 | 4040926 Zer0head
Zer0head's picture

To his friends he's

Jacob Joseph Lew

To his banker friends he's

DJ Jam Master JJ Lew



Thu, 10/10/2013 - 09:09 | 4040947 Manthong
Manthong's picture

Jack Jacob Jingleheimer Lew
His name is my name too.

Whenever we go out,
The people always shout,
There goes Jack Jacob Jingleheimer Lew. 

Dah dah dah dah, dah dah dah

Wow!    Scouts, Word UP..    This works way better.


Thu, 10/10/2013 - 09:23 | 4041020 smlbizman
smlbizman's picture

shouldnt lew have those buck teeth in his mouth to go with his glasses and his incompetent attempt to look asian....just like debbie chang...figure it out....

Thu, 10/10/2013 - 09:33 | 4041068 hedgeless_horseman
hedgeless_horseman's picture



To his friends he's Jacob Joseph Lew

Joseph Lew and and the Amazing Technicolor Dream Note?

Thu, 10/10/2013 - 09:31 | 4041075 Jay Gould Esq.
Jay Gould Esq.'s picture

Is Donny Osmond headlining this one too ?

Thu, 10/10/2013 - 09:42 | 4041101 hedgeless_horseman
hedgeless_horseman's picture





Benjamin! You nasty youth, your crime has shocked me to the core.
Never in my whole career have I encountered this before. 
Guards! Seize him! Lock him in a cell.
Throw the keys into the Nile as well.

Benjamin?  Benjamin Shalom Bernanke?

Thu, 10/10/2013 - 09:47 | 4041127 Jay Gould Esq.
Jay Gould Esq.'s picture


"I look handome, I look smart. I am a walking work of art."

Such a dazzling bill of many colors.

Thu, 10/10/2013 - 09:48 | 4041139 Max Hunter
Max Hunter's picture

I don't know how these people can keep a straight face when they talk about this shit.

Thu, 10/10/2013 - 09:56 | 4041157 hedgeless_horseman
Thu, 10/10/2013 - 09:58 | 4041168 Spastica Rex
Spastica Rex's picture

More home-eroticism.

Geez, Donny Osmond is hot.

Thu, 10/10/2013 - 10:08 | 4041202 GMadScientist
GMadScientist's picture


Thu, 10/10/2013 - 09:42 | 4041119 Yes We Can. But...
Yes We Can. But Lets Not.'s picture

This con-man from the Treasury can simply take the tunnel a block to have this conversation directly with the jackass in the White House. That this is a TV production is solid evidence of the stupidity of the public and the complicity of the statist-dominated media in the destruction of a powerful America.

Thu, 10/10/2013 - 09:25 | 4041038 TeamDepends
TeamDepends's picture

This Lack Jew character is saying what the masses think they want to hear.

Thu, 10/10/2013 - 09:37 | 4041100 Headbanger
Headbanger's picture

Tell Obozo it's fire and brimstone so he stops being such an ass hat and agrees to a budget bill with a delay in the Obozocareless Personal Mandate already!


Thu, 10/10/2013 - 09:51 | 4041148 CaptainObvious
CaptainObvious's picture

Only one Senator said what I want to hear: Portman from Ohio. He actually quoted Obama's 2006 debt limit speech.  Is he a secret Hedger?  +100 to Senator Portman.

Thu, 10/10/2013 - 09:40 | 4041055 Fredo Corleone
Fredo Corleone's picture

Lew's flattened hair and off-center part calls to mind another chap's hair-do from a few years back. All Jack needs is a bowtie, freckles, and a confused expression:


Thu, 10/10/2013 - 08:43 | 4040897 krispkritter
krispkritter's picture

Human sacrifice, dogs and cats living together, mass hysteria!...


That about sums it up.

Thu, 10/10/2013 - 09:10 | 4040956 Manthong
Manthong's picture

Don’t look back or you will turn to a pillar of salt.

USA--S&G.. pretty much the same difference nowadays.

Thu, 10/10/2013 - 08:47 | 4040907 remain calm
remain calm's picture

All of them are lying cocksuckers.

Thu, 10/10/2013 - 09:11 | 4040993 Groundhog Day
Groundhog Day's picture


"If interest rates rose, it would have a real impact on American households"

It sure would jack, the american households that are savers might actually be able to get a decent interest rate outside of the ponzi

Thu, 10/10/2013 - 09:33 | 4041076 pods
pods's picture

It would have a real effect as american household's doors would be kicked in by government goons desperately trying to find any and all FRNs to stuff in the expanding black hole of interest due on our debt.


Thu, 10/10/2013 - 09:17 | 4041007 Stoploss
Stoploss's picture

The math has already proved along with Moody's, that all necessary payments are FAR MORE THAN COVERED.




Thu, 10/10/2013 - 09:21 | 4041015 Boondocker
Boondocker's picture

Republicans cave... 

Thu, 10/10/2013 - 09:36 | 4041088 Dugald
Dugald's picture


Nearly exactly.........That close huh?

Thu, 10/10/2013 - 08:13 | 4040816 emsolý
emsolý's picture

Please do not worry.

Thu, 10/10/2013 - 08:19 | 4040826 Mae Kadoodie
Mae Kadoodie's picture

Wag the Lew.

Thu, 10/10/2013 - 08:20 | 4040828 GetZeeGold
GetZeeGold's picture



Lew doesn't know Jack.

Thu, 10/10/2013 - 08:32 | 4040855 Zadok
Zadok's picture

It's my way or tanks on the highway!

Gimme all to money or the taxpayer gets it!

Hank Paulson summarized.

I guess they think we're stupid...doh!

Jack Lew...bwahahaha!

At least this will be interesting, if self destructive.

Woohoo! Let's get it on!

Thu, 10/10/2013 - 08:39 | 4040873 Lets_Eat_Ben
Lets_Eat_Ben's picture

Nobody wants to see your giant shit Lew!

Thu, 10/10/2013 - 08:40 | 4040884 max2205
max2205's picture

Sheep.   Que up please.....

Thu, 10/10/2013 - 08:42 | 4040890 kralizec
kralizec's picture

Fuck Lew!!!

Thu, 10/10/2013 - 09:44 | 4041123 Jumbotron
Jumbotron's picture

No.....Fuck LEW !!!!!  ;)

Thu, 10/10/2013 - 08:28 | 4040837 Its_the_economy...
Its_the_economy_stupid's picture

"Please do not worry"


I can't tell you how much it tickles me everytime I read that line.

Thu, 10/10/2013 - 08:16 | 4040817 hedgeless_horseman
hedgeless_horseman's picture



Neither a borrower, nor a lender, be.

Thu, 10/10/2013 - 08:40 | 4040876 greatbeard
greatbeard's picture

>> Neither a borrower, nor a lender, be.

I learned that the hard way.  I've never been a borrower (well, a mortgages that I paid off quickly, and a couple of car loans that I did the same thing with).  A lender I've been quite often, and I relearned the old axiom, lend money to a friend and you lose both.  I've always been a chronic saver with a big heart, which is a bad combination.

Thu, 10/10/2013 - 09:40 | 4041114 John Law Lives
John Law Lives's picture

The Skipper agrees (starting at the 0:32 mark):


Thu, 10/10/2013 - 09:54 | 4041151 GMadScientist
GMadScientist's picture

But what if I found an incredibly generous lender (of last resort!) and a sea of desperate borrowers into which i could insert myself and collect the difference?

Thu, 10/10/2013 - 08:16 | 4040818 the not so migh...
the not so mighty maximiza's picture

tanks in the street, the sun will stop shining, etc etc

Thu, 10/10/2013 - 08:20 | 4040829 optimator
optimator's picture

And no Bankster Bonus.

Thu, 10/10/2013 - 08:40 | 4040877 Urban Redneck
Urban Redneck's picture

No record bankster bonus means no additional tax revenue for the blood sucker congress critters to feed on... which is the real threat (that he of course refrains from using)

Thu, 10/10/2013 - 08:45 | 4040896 LawsofPhysics
LawsofPhysics's picture

Why are bankers paid to begin with?  What product of real value do they actually create again?  Fuck em.

Thu, 10/10/2013 - 09:55 | 4041158 GMadScientist
GMadScientist's picture

Also known as 'vigorish'.


Thu, 10/10/2013 - 08:53 | 4040928 Sudden Debt
Sudden Debt's picture

let's jut hope all this shit doesn't affect Obama's golfgame... he's got a serious handicap already.... his ears... they keep growing... just compair the last 5 years pictures of him.... if he would be Sadam Hussein they would say he's a stand in...

Thu, 10/10/2013 - 08:17 | 4040820 Its_the_economy...
Its_the_economy_stupid's picture

"interest expense is a fraction the revenue the Treasury brings in"


Tried to contact the IRS yesterday. No answer. Message saying the IRS is closed.


Don't think the Treasury is going to be bringing in squat.


Whereas the Congressional health spa may be an "essential government function", collecting taxes is not.

Thu, 10/10/2013 - 08:30 | 4040853 DaddyO
DaddyO's picture

The Spa is where junior CONgressmen and Sinators perform the 3 S's.

They often sleep in their offices and perform their personal grooming in the Spa until they are able to become rich, then they can afford a Vichy DC apt.


Thu, 10/10/2013 - 08:41 | 4040885 greatbeard
greatbeard's picture

>> Don't think the Treasury is going to be bringing in squat.

Don't fool yourself, anything that helps or is a benefit to the taxpayer is suspended (although the folks will get paid for doing nothing).  The rest of the crime operation is open for business.  Collections will go on. Wars will go on.  The hog troughs will be well supplied.  Cake will be withheld from the masses until they understand what they need to understand.

Thu, 10/10/2013 - 08:20 | 4040830 jtz5
jtz5's picture

I love ZH, but I am getting tired of the way ZH plays both sides of every argument.  For example, ZH said the market will have to crash in order for politicians to agree on a debt deal, but then yesterday said Paul Ryan would provide a fig leaf to avoid a debt impasse.  You can change your mind on a prediction as events unfold, but then don't use the "as we predicted here" link to make you look like you were always right with your prognostication.  If the crash scenario would have proved true, ZH would have provided the same "as we predicted here" link, but with a link to that story.

There are numerous other examples of this, as well.

Do NOT follow this link or you will be banned from the site!