Stockman: "After March 15 Everything Will Grind To A Halt"

Tyler Durden's picture

Two weeks after David Stockman warned that "the market is apparently pricing in a huge Trump stimulus. But if you just look at the real world out there, the only thing that's going to happen is a fiscal bloodbath and a White House train wreck like never before in U.S. history" and exclaimed that, when looking at markets, "what's going on today is complete insanity" he is back with another interview, this time with Greg Hunter of USAWatchdog in which he, once again warns, that a giant fiscal bloodbatch is coming soon, and urges listeners to pay especially close attention to the March 15, 2017 debt ceiling deadling, at which point everything could "grind to a halt."

As Greg Hunter writes, former Reagan Administration White House Budget Director David Stockman says financial pain is a mathematical certainty. Stockman explains, “I think we are likely to have more of a fiscal bloodbath rather than fiscal stimulus.  Unfortunately for Donald Trump, not only did the public vote the establishment out, they left on his doorstep the inheritance of 30 years of debt build-up and a fiscal policy that’s been really reckless in the extreme.  People would like to think he’s the second coming of Ronald Reagan and we are going to have morning in America.  Unfortunately, I don’t think it looks that promising because Trump is inheriting a mess that pales into insignificance what we had to deal with in January of 1981 when I joined the Reagan White House as Budget Director.”

So, can the Trump bump in the stock market keep going? Stockman, who wrote a book titled “Trumped” predicting a Trump victory in 2016, says, “I don’t think there is a snowball’s chance in the hot place that’s going to happen. This is delusional.  This is the greatest suckers’ rally of all time.  It is based on pure hopium and not any analysis at all as what it will take to push through a big tax cut.  Donald Trump is in a trap.  Today the debt is $20 trillion.  It’s 106% of GDP. . . .Trump is inheriting a built-in deficit of $10 trillion over the next decade under current policies that are built in.  Yet, he wants more defense spending, not less.  He wants drastic sweeping tax cuts for corporations and individuals.  He wants to spend more money on border security and law enforcement.  He’s going to do more for the veterans.  He wants this big trillion dollar infrastructure program.  You put all that together and it’s madness.  It doesn’t even begin to add up, and it won’t happen when you are struggling with the $10 trillion of debt that’s coming down the pike and the $20 trillion that’s already on the books.”

Then, Stockman drops this bomb and says:

“I think what people are missing is this date, March 15th 2017.  That’s the day that this debt ceiling holiday that Obama and Boehner put together right before the last election in October of 2015.  That holiday expires.  The debt ceiling will freeze in at $20 trillion.  It will then be law.  It will be a hard stop.  The Treasury will have roughly $200 billion in cash.  We are burning cash at a $75 billion a month rate.  By summer, they will be out of cash.  Then we will be in the mother of all debt ceiling crises.  Everything will grind to a halt.  I think we will have a government shutdown.  There will not be Obama Care repeal and replace.  There will be no tax cut.  There will be no infrastructure stimulus.  There will be just one giant fiscal bloodbath over a debt ceiling that has to be increased and no one wants to vote for.”

Stockman also predicts very positive price moves for gold and silver as a result of the coming budget calamity.

There is much more in the video interview below in which Greg Hunter goes One-on-One with David Stockman.

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GOSPLAN HERO's picture

"If the North triumphs, it is not alone the destruction of our property; it is the prelude to anarchy, infidelity, and the ultimate loss of free and responsible government on this continent. It is the triumph of commerce, the banks, and the factories."                                                                                                                                               

 

Lt.Gen. CSA, Jackson1862      

FPearl602's picture

More market crash BS courtesy of ZH and David "Sky is Falling" Stockman. 

http://davidstockmanscontracorner.com/goldmans-swell-new-reckos-what-sto...

 

 

 

 

 

 

ExpertiseAsia's picture

Stockman's era may have passed a while ago, and he is way too brutal in his views to ever be spot on with forecasts, but he does know what he is talking about. After all, he had learned his lesson in the early 80s hands-on. In this wake, let me offer another piece from Asia this Monday morning, here.

 

King of Ruperts Land's picture

When using token money ($US) for the unit of account, anything is possible. The accounting is all fiction. If Trump manages to increase employment in the US, then more Americans have more money to buy the more stuff that is made in US. All he has to do is crack the whip, CRACK. There will be a rise in real economic measures, output of concrete, steel, lumber, restaurant meals, labor hours.

wolfessannie's picture

Hey, anything to get the worthless orange marmalade REEEETARD out of our misery!

rejected's picture

And who is your replacement? Lardass Clinton? Everything free Bernie?  Canadian Cruz? Retard Rubio? Corporate killer Carly? Recount Stein?

None of them even fit for Dog Catcher.

Bemused Observer's picture

The date-setters really have to take a lesson from the Jehovah's Witnesses, and stop 'marking' specific calendar dates. The Witnesses finally learned this back in 1976, after several well-publicized failures of the world to end on time.

That said, the idea that what we are doing now is NOT sustainable is a no-brainer...we will just never know exactly WHEN TSHTF. It will, as it always does, take nearly ALL of us by surprise.

But the date-setting only chisels away at your credibility, as date after date comes and goes without prophecy being fulfilled. Finally, the warnings draw only yawns...

Focus on the economic specifics without trying to draw the conclusion about how/when it all ends...let the readers do that on their own. Just give them the facts the MSM never does. Most average folks operate on common sense...keep shoving the facts in their faces and they WILL eventually see the bullshit for themselves very clearly.

CampOfTheSaints's picture

Trump can play the same game that Obama played, when the SCOAMF closed Washington DC veteran's monuments, and turned away WWII veterans in wheelchairs.

Only this time, threaten to defund EBT and SNAP cards, pull funding from all global warming climate studiuse programs, and pull all funding from the UN.  Let's see how fast Democrats can run to the capital to sign the dotted liners.

indygo55's picture

Yes but don't cut the military budget! NO! NO WAY! Not that!! Heavens no.

http://www.motherjones.com/mojo/2011/09/contractor-waste-iraq-KBR

 

sinbad2's picture

What will happen to stock and gold prices, if the US Government stops buying and selling?

Franktastic's picture

I read something interesting in the Constitution today;
To the effect of "All debts incurred in the act of sedition or treason against the United States shall not be honored.

Time to retabulate that national debt.
Pretty much everything from Clinton to Obama was treason.
(Probably goes back a lot further)...or just end the fed.

squid's picture

"Time to retabulate that national debt.

Pretty much everything from Clinton to Obama was treason.
(Probably goes back a lot further)...or just end the fed."

Ok, good idea but.....

Which treasuries get voided and which don't?

The largest holders of treasuries are pension funds, private and state. They hold the treasuries BY LAW.

So how does this work?

You void them all and bunkrupt the pensions for 50 million baby boomers?

 

Just thought I'd ask.

 

Squid

LN's picture

You void them all and bunkrupt the pensions for 50 million baby boomers?

50 million heavily-armed cranky old people with nothing to lose.  Should be fun to watch...

...from a great distance.

LN

2nd try

Yes We Can. But Lets Not.'s picture

March 15?!  That's like 2 weeks!  PLACE YOUR BETS:

>>>  Stockman is right, HUGE CRISIS in 2 weeks!

>>>  Stockman's blowin' smoke, no huge crisis next month.

The thing is, if he's right about this looming massive train wreck just days away, how come nobody else is screaming it from the rooftops?

Icahn?  Wibur Ross?  Bloomberg?  Buffett?

SunRise's picture

Because they're inside the dining car on the train, not on the rooftops.

TabakLover's picture

drinking coffee and smoking big cigars......

Robert Trip's picture

Just another asshole crying "wolf."

Nothing is going to crash, EVER.

You think the rich pricks that run things are willing to lose their shirts?

In your dreams.

Bear's picture

Well then .... exactly how are we going to get out of this fiscal trap?

TabakLover's picture

the rich fucks go short at exacty the right time......you dumb ass.... while you jizz your pants over a new iphone.  

rsnoble's picture

'Has' to be raised.  Meaning after fighting and causing much pain and costing more than it would otherwise, just so some fktard politicians look good, it will be raised.  It will continue to be raised until the collapse literally makes it impossible to do so. I expect major wars are coming soon.

LOL123's picture

Of course wars are on the horizion... That is how collection of debt works . assets, real assets, tangible assets of value such as oil/gas rich lands and mineral rights with water pools are collected in a debt driven system... Nothing new. What is new is that the average person has opened their eyes and minds to the rigged system.

LOL123's picture

Oh pleeeeze. We are playing with fake money nothing tangible or with real backing of value, so technically there is no ceilng. It is an arbritary number made up. Every year could be a "prosperous" year in this virtual reality of computerized digital matrix economy. So why does it / should it, stop during a conservative, security conscious administration? Why? Because the money changers of the fake "denominaton "says so? This "Debt driven system was installed a long time ago so let's all pretend it actually means something in the present world of "war"debts and political rivalry. All hands up and hold up the ceiling another couple of notches... It really doesn't matter at this point UNLESS the money changers want a reset and new one world cenralized sysytem that includes Syria not currently playing ball.  Lol

Recriminator's picture

I have read dozens of responses to David Stockman. The more I read, the more confused I get. Most think the debt increase is almost automatic. It very well may happen that way. BUT, the Dems are out for blood; and if there's a way to throw a monkey wrench into the machine - THEY WILL !  Any chance to f'up the Economy, they'ii take it. Remember, there are quite a few RINOs running around Congress too.

Recriminator's picture

I have read dozens of responses to David Stockman. The more I read, the more confused I get. Most think the debt increase is almost automatic. It very well may happen that way. BUT, the Dems are out for blood; and if there's a way to throw a monkey wrench into the machine - THEY WILL !  Any chance to f'up the Economy, they'ii take it. Remember, there are quite a few RINOs running around Congress too.

Sid Davis's picture

Professor Albert Bartlett did a few youtube videos discussing the mathematics of compound growth.

I did some of my own calculations. If you begin with 1900 and calculate the rate of growth in federal debt it is about 8.2%. If you start with 1964 instead, the year silver was removed from circulation as money, the rate is a little higher, but not significantly, 8.4%. Roughly we can expect debt to again double from where it is today by the end of Trump's second term, presuming he is reelected.

There is no stopping the growth. $20 trillion grows into $39+ trillion 8 years from now, $75+ trillion 16 years from now, and that is a hopeful guess; knowing how government works we shouldn't be hopeful. The rate of growth in the economy is well below 8% so the ability to pay the it is diminishing with each passing year. Default is the lesson of history when it comes to government debt. And these debt numbers are just the official debt; it doesn't include the unfunded promises for Social Security, Medicare, and government pensions which eclipse the formal debt.

Trump doesn't stand a chance of getting this under control; Houdini wouldn't even have a chance. This is just a comedy that is playing out and the biggest laugh is that much of the public thinks this will just work itself out.

LN's picture

"Professor Albert Bartlett"

"The greatest shortcoming of the human race is our inability to understand the exponential function."

An eight part series on youtube, worth every minute.

+1,000

LN

sinbad2's picture

If US debt was increasing exponentially, it would be doubling every year.

Now I know things are bad, but they are not that bad, yet.

Hillarys Server's picture

So true. Exponential grown is fantastic.

If you fold a 0.5 millimeter-thick newspaper 100 times, it will be 60 billion light years tall.

Taller than the diameter of our visible universe.

You don't notice it on the first three or four folds.

I worked it out on Excel.

conraddobler's picture

You can print currency or digital dollars but you can't give them actual value.

Also, printing them does nothing to stimulate the real economy it actually is a net massive negative because it gives all kinds of false signals and props up things that otherwise could never exist and kills things that should thrive.

It's the ultimate moral hazzard.

No, check that, elevating mankind to the place reserved for the creator of our universe is the ultimate moral hazzard with money and credit control in the hands of private men being a close second.

bluskyes's picture

What does that have to do with the feds money printing, or market levitation?

Would it prohibit the treasury from issuing greenbacks instead of fed notes?

LOL123's picture

The Federal Reserve TELLS the government how much money to print. No printing and the machine stops... No income, zero spending, no spending no economy it is a circular system with the only ones "prospering" in this virtual matrix reality are the international community of bankers who live off the interest. Debtors  prison for the rest of the " flock.

Arrest Hillary's picture

"Beware the Ides of March !" ....  A "heads up" given to Caesar .

sessinpo's picture

This is one area where nothing has changed. No one has the balls to tell the american people, sorry, but your fucked. The nation is broke. Your benefits will be cut or eliminated.  The government sold you out a long time ago. Have a nice day.

The  ceiling will be lifted.

Blazing in BC's picture

MAGA...one 10% flat tax at a time

European American's picture

I don't know...according to all the financial soothsayers out there, I thought last April was going to be "The Big One"? It's getting to the point where I'm wondering what world is it on the internet that keeps insisting that EVERYTHING is going to implode NEXT WEEK. I may have a small arsenal under my bed and a few ohZees of gold between my mattresses, but when I look outside my window, things out in the country where I live don't look so bad.

Reaper's picture

The end of insanity is hard to predict.

Anarchyteez's picture

Or this could whole thing could turn into the biggest soupsandwhich the world has ever seen.

Chaos and opportunity bitches. Plan well.

Savyindallas's picture

I have a solution to cut military spending in half  -buy all our planes, shipps, missiles, missile defense systems, tanks, etc. from Russia and China  -they will be far better in quality, at a mere fraction of the cost. Close all our overseas military bases, end all foreign wars-sue and imprison all the war profiteers who have ripped us off. Do all of this and it will be an incredible boon for America. 

didthatreallyhappen's picture

hopium?when obama was president, it was not hopium?

Omega_Man's picture

Donald will raise it to 30 trillion... no prob... he is going to drop coin....Mericans will buy their own debt at 0%

directaction's picture

The haunting fiscal mismanagement debt crisis is easy to fix.
Simply print and print and inflate the debt problem away.

moneybots's picture

“I think what people are missing is this date, March 15th 2017.  That’s the day that this debt ceiling holiday that Obama and Boehner put together right before the last election in October of 2015."

 

But we have seen this game before. They always raise the debt ceiling. 

Kefeer's picture

In the coming weeks, Congress must act to increase the debt limit. Congressional leaders in both parties have recognized that this is necessary.- https://www.treasury.gov/initiatives/Pages/debtlimit.aspx

Falcon49's picture

They did not raise it in October....they suspended the requirement to raise it until March 2017.  That was very different from past actions that always increased the amount to a specific number.  The last action guaranteed that this latest requirement would land after the elections.  Nothing happens by accident and there are not coincidences.

HoserF16's picture

Eventually, one of these GURU's will be correct. Then, they'll be empowered to really predict the "End of Days!" Sure glad I listened to them 8 years ago and got all prepped-up. Got out of the stock market and bought precious metals. Still licking my wounds on that one. I'm forced to wait until the market crashes so I can get back in. Too dangerous now.

LN's picture

Missed again.

LN