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Here's How The October 17 "Debt Deadline" Could Be Breached Even With A Last Minute Deal
With two days to go to until dreaded October 17 D-Day (on which incidentally, very little of note will happen, because as Goldman explained earlier today, that is simply the date past which the Treasury can no longer borrow, but still has some $30 billion in cash which could last to fund the Treasury's needs as long as the end of the month if not longer) Washington is now openly playing with fire. Because for all the hopeful talk of an imminent deal on Thursday, then on Friday, then today, not only is there nothing substantive on the table, but Obama will not even meet with the Senate, let alone the House, until tomorrow morning. At that point there will be about 36 hours until October 17. But what is worse for all the end is nigh-ers, who are absolutely certain the world will end if Congress crosses the D-Day deadline (which, again, as Goldman said earlier "going slightly past the October 17 deadline is entirely possible") is that as The Hill explains, Senate could still miss the debt deadline, assuming there is a debt deal in the first place. Which is a big if.
Here's how someone (coughcruzcough) so inclined (and there are quite a few conservative someones out there) could delay the process so that the magical October 17 deadline is breached. The Hill explains:
if a senator or group of senators wanted to prolong the process as long as possible, experts warn, the Senate could blow right past that deadline even if there are enough votes to overcome a filibuster.
"People should recognize that it is going to be a major legislative effort to get any deal that's reached passed by the end of Thursday," warned Steve Bell, a longtime Republican Senate staffer who is now with the Bipartisan Policy Center.
Whether the Senate will be able to advance a compromise before the Treasury deadline will hinge almost entirely on whether any senator decides to exhaust their procedural powers fighting the measure.
"If [senators] want to really be as obstreperous as the rules of the Senate would allow them, I don't think you could pass a deal ... until the weekend," said Bell. "That's the worst case scenario."
Sen. Ted Cruz (R-Texas) did almost everything he could to delay work on a continuing resolution to fund the government, even holding a 21-hour speech on the Senate floor.
Cruz on Monday declined to say whether he could get behind a deal that didn't make significant changes to ObamaCare, and wouldn't give any indication as to whether he'd try to block it.
"We need to see what the details are first," Cruz said.
Cruz is hardly the only stumbling block toward a smooth deal, should one even materialize. And judging by the market's reaction, which is now up 600 points in three days just on hope there will be a deal, any actual impetus to act by the Republican party, which will only bury itself even deeper in the popularity rankings if it folds to all of Obama's demands, has been effectively eliminated. In fact, the so-called Ben Bernanke market is openly daring the government to stay shut down, and please, do breach the debt ceiling. The GOP may very well oblige.
Sen. Joe Manchin (D-W.Va.), who has been involved in compromise talks with centrist members, said Monday the contours of a final deal could influence whether conservative senators like Cruz or Sen. Mike Lee (R-Utah) tried to slow it down.
Sen. Patrick Leahy (D-Vt.) acknowledged that passage of a deal could take a while due to procedural tactics.
"If we had grownups who care more about the country than their own political future and the kind of fundraising they can do from a small ideological group, then I'd be very confident," he said.
Finally, it was Jack Lew himself who if not literally last Thursday, then certainly metaphorically made it quite clear that an October 17 deadline would mean without a deal, then fire and brimstone pouring on sinners from heaven: "The Treasury has not said the government would default Friday without a debt-limit boost, but warned that it could no longer guarantee the government would be able to pay all its bills on any given day."
It would be quite ironic to the purveyors of untold destruction - namely Obama, the US Treasury, and all democrats - if first the Sequester, then the Fiscal Cliff, and now the debt ceiling had their deadlines crossed, and the world was still standing the next day.
But hardly surprising. Then again, all is fair in the Washington's Hollywood endings of the perfectly expected. And this one will be no different... even if the US does actually default technically for a few brief hours.
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("We need to see what the details are first," Cruz said.)
Duuuuude. Ya gots to pass it in order to read it. Keep up!
Ted, give Obamacare a couple of months to hang itself. In the meantime, come up with an alternative.
All these articles with predictions that there's even a 1% chance of a "default" are total, unmitigated bullshit.
I will say it again: Both "different" political parties are working for the same exact entities & individuals, and not the actual voters who allegedly elected them.
Neither political party, fully captured, bought & paid for by the same task masters, dare to cut off the MOAR TAXES, SPENDING & DEFICIT-DEPENDENT GRAVY TRAIN that further indents the American People while enriching the KronyKapitalistCriminals.
Finite.
oct 17/18 = Kabuki Day
everyone please to remain attached to your msm feeds
that is all
It's bukkake day for any American who actually works for a living in a non-government, non too-big-to-fail banking/Wall Street job & pays taxes.
it's the Tea Party stupid!
I'm the Captain and I'm telling you nothing can go wrong, it's unsinkable.
But Captain, what's that ahead...........it looks like an iceberg?
Don't worry about it............Dickhead!
I wasn't buying gold or options during the 2008 crisis so I ask you all. Where you able to, or did you buy put options on the SPY? Where you able to buy bullion anywhere for whatever the spot price dropped to?
I was a bit busy cleaning and changing my underwear, but as I recall, you could buy gold at the local coin shop for a price that was pretty tight to spot. And you could actually get it without a long wait. The significant divergence started earlier this year (in price and availability). A relatively recent phenomenon.
But I am old and forgetful. Others may have different recollections.
"But I am old and forgetful. Others may have different recollections."
No, you're correct. You were very busy cleaning and changing your underwear. :)
<And there was plenty of physical Gold and Silver to be had at very reasonable markups.>
I meant to say were not where.
and not that I'm buying put options now. The Fed's ballance sheet is halfway to the moon and the market is waiting to catch up (or is it the dollar coming down?). I'm just asking in case it hits the fan.
If you expect it to hit the fan, it won't. Also folks have been expecting it to hit the fan for year and it hasn't. Be careful. SPY puts are expensive. Use spreads or better yet, ETFs and GO SMALL. Be careful with the PMs. They do not always move like you expect.
Folks have been expecting it to hit the fan for much longer than year. Physical PM's are not an investment play Vito. It's savings for the chillen, like your house, you leave it to them when the big boss says it's time to go. Except of course if TSHTF, then your PM's will be worth much more than your house.
That's easy enough to figure out on your own.
Who cares anyway...? Stay away long enough and no one will ever miss you.
If we keep going with this excessive mental masturbation we're all going to go blind.
Isn't that equivalent to a mini ponzi (i know, oxymoron)?
Hit something hard,I dont want to limp away from this piece of shit!
Nothing will happen if the US does not raise its debt ceiling, at most the dollar will rise and bond yields will drop as the credit agencies upgrade the US beyond triple A. This kabuki theatre is for the actors alone, not even the native audience. The fact is the US economy is no longer subject to normal laws, we have passed the tipping point already.
The fate of the US economy now rests in its creditors ability to suspend disbelief and nothing else. Once that suspension ends hell will almost literally break loose.
Cruz on Monday declined to say whether he could get behind a deal that didn't make significant changes to ObamaCare, and wouldn't give any indication as to whether he'd try to block it.
I thought they made some changes.
http://thehill.com/blogs/healthwatch/health-reform-implementation/328459-labor-gets-obamacare-olive-branch-
$50 to ZH if the House hangs tough. And $50 for a good bottle. Thanks for the info.
Democrats still believe the ``OMG DEFAULT END OF THE WORLD`` propaganda... first of all, THERE WILL BE NO DEFAULT, IT'S A FUCKING LIE. Second of all, LET THE GOVERNMENT SHUT DOWN, WE DON'T NEED IT.
If Congress actually wanted to do something about it, they would start issuing money by the power that was given to them in the constitution and put the Fed out of business.
Yawn. Not going to happen. Wall Street has let its bought-and-sold DC clowns have their fun and is now cracking the whip. The calls have been made, the fix is in. It's all just been color and movement to keep the masses distracted and confused. Real money and power will now re-assert control. Same as it ever was.
But, but, but... The market is saying nothing much will happen. Up again in Japan this morning. The NSA must already have a list of "market appostates" which closely correlates with ZH readers!
All that will happen on Thursday - assuming there is no deal - is that the crony oligarch of omaha will give his lackies at moodys a green light to downgrade the u.s. debt rating to Aa1 (which it will dutifully do after the market closes on Oct 18). The market will freak out a bit on that news...but not as much as when S&P takes its u.s. rating down another notch from AA+ to AA in the 3rd Q of 2014.
Congress will march right through the deadline because they can and Obama will undo all their damage by Executive order - constitutional or not, the world will not care. Republicans will try to impeach him for the next 2 years...
Prefer default.
Let Obama sell the WWII memorial to the Chinese, see if I care, they'll manage it better than he does.
It doesn't end until pelosifeinsteinreidbonermconnelcruzetcetc and their staffs bank a few mil on the frontrunning. and their brokers. and any priveleged non muppets. you and me? we jus be chillin.
Yeah, because if I'm some other government, I can't wait to lend to such a fiscally responsible entity as the U.S. gov't.
D.C. ought to start looking into pay day loans.
No matter how pissed the easily distracted mob becomes with the TEA Party now, it will all be forgotten as they discover the joys of oBUMMER care. Hang tough as hell TEA!
If Republicans had a brain cell in their heads, which they obviously don't, they would let the deadline come and go while sticking to their guns (no pun intended). It will be a Y2K event and, since the country has money to pay bills until sometime in November, Obama comes off as a fear mongerer while Republicans can spin it as "not rushing into a deal because they were forced, etc." Completely turns the table on Dems.
Harold, Harold, Harold....get off the red vs blue pile of bullshit they want you to believe. IF there's a default, it will be because it was planned by both parties from higher up-way higher than Obama and Lady Gaga.
HarryWanger, shouldn't you be more concerned with your Chinese based urinal cake export business on Alibaba.com?
If there truly was a conservative political party that actually had any intention of faithfully representing their constituency, they would go on live TV and state "we will not raise the debt ceiling for any reason whatsoever. It is well past time for a balanced budget. We now have no choice but to live within our means. Thank you and goodnight."
too bad there is no such party ...
It would be nice to see a Cruz/Paul filibuster for about 36 hours starting October 17th. It would be nice to see the banker wankers shit their pants for once.
Sadly, it is just theater, and nothing will change, despite a few well intentioned people. The show will go on, and the Titanic will move forward !
I say get rid of the so called debt limit once and for all, QE to infinity full speed ahead!
Ok, so Oct 17 passes uneventfully, except for options expiry mayhem the next day, and then the Treasury pays its bills til the $30 billion starts to run out.. Cue Obama to bypass Congress and raise the debt limit by Executive Order, just as Clinton suggested two years ago.
... and if Congress took their responsibility serious then they would impeach the mofo-from-some-other-space-time-locus and get on with business. But they won't. They are too afraid... of what or whom is not exactly clear.
"People should recognize that it is going to be a major legislative effort to get any deal that's reached passed by the end of Thursday," warned Steve Bell, a longtime Republican Senate staffer who is now with the Bipartisan Policy Center.
I can not see why, that should be such a big thing? Just raise the "ceiling" and "done". You will not explain to me that they really want to change the course of not spending more then the take in or will you?
Who cares. We don't need no stinking banks or bankers. Fuck em. We didn't get this idiotically advanced without genetic variation and survival of the fittest.
What's wrong with a rampage of locking up bankers and redistributing their stolen wealth?
The shelf clearing events at WalMarts Saturday was a great analogy to what we have going on in Congress today.
Their spending card is on the blink, and all they are waiting for is the green light of unlimited funds to go on their shopping spree regardless of whether they can ever pay for it or not.
And who really are the chumps in this?
(Hint....look in a mirror)