This page has been archived and commenting is disabled.
Guest Post: Dear U.S.A.: Your Account Is Overdrawn
Submitted by Charles Hugh Smith from Of Two Minds
Dear U.S.A.: Your Account Is Overdrawn
Dear U.S.A.--your overdraft protection is about to be pulled.
Dear United States of America: We regret to inform you that your withdrawals exceeded your deposits last year by $1,600,000,000,000 ($1.6 trillion), including your "supplemental appropriations" spending.
Your account does have an overdraft protection, and so bonds were sold to cover your $1.6 trillion overdraft. While we value your business, we feel obligated to remind you that this is the third year that your overdraft protection exceeded 10% of your gross national product (GDP), and it seems your account is on course to register yet another $1.6 trillion overdraft in fiscal year 2012.
Currently, your overdraft account exceeds your GDP of $15 trillion.
Quite frankly, we are worried that you have become dependent on extensive overdraft protection--a feature designed to tide the account holder over for a short period of time in near-term expectation of higher deposits or lower withdrawals--and that relying on large-scale overdraft borrowing to cover your basic expenses is now your standard operating procedure.
This violates the intent of the overdraft feature, and as a result we must seriously consider modifying the terms of the overdraft protection on your account. Current conditions enable us to provide this overdraft, but the feature was not designed to be permanent nor on this scale.
In order to give you sufficient time to bring your deposits and withdrawals back into alignment, we will maintain the current low-interest overdraft protection on your account through fiscal year 2012. Beyond that, however, please be aware that to maintain the integrity of the system, we will have to raise the rate of interest on your overdraft and scale back the size of the overdraft line of credit.
We regret informing you of these modifications, but the overdraft protection was not intended to be permanent nor near-infinite in scale.
Yours truly,
The Global Bond Market
»
- 9985 reads
- Printer-friendly version
- Send to friend
- advertisements -
Dear U.S.A.,
You are living a lie. Please wake up. Thank you.
Sincerely,
-LH
amazing how they have been getting away with this for so long seeing as they have no intention of ever paying it back....implicit or explicit default?
it has gone on long enough that the common person now believes that it is sustainable.
Dear The Global Bond Market
I have noticed that you have written to one of are clients, the USA, about the possibility of increasing the rates on their overdraft to maintain integrity of the system.
I would like to point out that any raise in rates will not be tolerated as low rates are necessary to ensure the affordability of the debt and increase economic growth. We ensure you that we will maintain integrity of the system by purchasing the debt and we will ensure the USA is able to finance its activities indefinitely.
Yours truly,
The Fed
A La Mode, Bitchez! 15 trillion is the new 20. Pretty soon it'll only cost 45 bucks for a loaf of bread. If you can find it, that is. The money. Not the bread. Ok, the bread too.
"to maintain the integrity of the system"
Fanciful idea.. decoupled with system as it exists.
Dear Global Bond Market,
Have you noticed what's been going on in the world? Have you seen what has happened to all countries that have spoken out against or expressed any negative tone about the USD hegemony and/or debt?
Please don't be foolish. Sit down, shut up, and take your ass fucking with a smile, like the rest of the world..
Do I get a courtesy SPIT?
You hit it - the inability of the FED to raise rates. A huge recovery would be more frightening than a continued recession since inflation could not be controlled by raising rates. Most folks have convinced themselves that we can forever borrow over a trillion/yr but when the EU is semi-resolved, all eyes will turn to Japan and the US.
Fed just creates more funny money for eternity.
Right?
Got the new $1000 bill with the Malcolm X portrait?
Dear Concerned citizen (AKA GOSPLAN HERO)
Do not worry, I assure you there are no side effects of creating "more funny money". We are doing this purely out of our own generosity and the individuals who claim this will ultimately cause inflation do not understand that we are currently in a negative stage of the economic cycle caused by complete randomness, therefore the money creation will cancel out deflationary pressure. Once the random economic cycle turns, the deficit will shirnk and we can sell the bonds we purchased back to the market and the deflation will be offset by the economic growth resulting in stable prices. It is actually the most brilliant and perfectly executed plan in all of history, but do not worry, it cant possibly go wrong.
Thanks
The Fed
You forgot the bit about figuring out how to print a cheap energy source to maintain said growth.
Dear Fed,
Why do I feel so violated?
Dear Concerned Citizen,
Please be advised that you are not in fact being brutally and serially raped in the rectum --- we are actually making Keynesian sweet love to you (figuratively and literally). Your belief that you are bleeding and passing out in pain is incorrect based on all our models and theories, and to the extent that you may be feeling any discomfort as a result of our tender ministrations towards your "soft patch", we assure you that they are only transitory in nature. And we promise, we WILL still love you in the morning.
Sincerely,
The Fed
Well, I guess we've got at least four Fed-lovers among the readership here.
For those four, you FULLY deserve what you are getting --- too bad the rest of us, who do NOT wish to be raped by the Fed and financial oligarchy, are getting the same treatment in the process, too.
Oh, man...I thought that it was going to have J-Lo on it. Or...how about the image contained within....
http://www.catherineomega.com/2009/07/blogathon-2009-the-typography-of-idiocracy/
Dear Global Bond Market,
While we realize & are quite remorseful that our account is overdrawn, we would respectfully ask you to realize you hold no relative power here, have been checkmated (as well as check/cheque kited), and that we would hope you speak of this matter no more - not publicly nor even privately - lest we bomb your ass back to the stone age.
Signed,
Amerika
*Fuck Yeah
cc: Bilderberg Group
cc: IMF
cc: Bank For International Settlements
cc: World Bank
cc: Council on Foreign Relations
cc: Rockerfeller Foundation
cc: Rothschild Group
cc: NM Rothschild & Sons Ltd
What was Timmy doing in COMMUNIST china yesterday?
Seems like a State Department function not a treasury one.......ANY IDEAS?
It means that State has be re-orged as a division of the Treasury.
Don't act surprized. It's always been about money.
He's is at the bank begging for money. He has a deal worked out with the state department who has a deal worked out with the department of defense on what kind of secrets they will give out for a small 1.2 trillion dollar loan.
Baby Boomers. The Entitlement Generation. Buy a Bugatti on the credit card, crash it, & force the kids to pay for it. Meanwhile, ship the kids' jobs to Mexico & China for a pop in the stock portfolio. Sure they can pay it all back working at McDonalds.
Two words boomers: As if.
Repudiate, Bitchez.
Baby Boomers = Hippies
Yeah, this is all the Boomers fault. Give me a fucking break.
Baby boomers = Soldiers returning from WW11 stressed from war and happy to be home with wife again.
Hippie = Americans happy at home not wanting to go to war and face death for banker/war machine profit.
Baby boomers = Hippies = Faulty Equation.
A Happy (to be alive) Hippie who served and the offspring of a couple wonderful boomers.
Well some boomers are doing fine. Like the boomers in the .1%; and those few who managed to retire early, sell the house before the crash, and are still collecting the pension or put the 401k into gold eagles. Maybe 1 in 500.
Lots of other boomers had their jobs offshored and now work at Wally World or Target. Some experienced the pension that disappears upon application to collect, and/or have their adult children and grandkids living with them, because the children don't get extra at McD's for that expensive degree.
The screwing of the collapsing middle class has been going on for well over a century. It's more noticable lately, during the reign of boomer vampyre banksters; partly due to internet reporting, but mostly due to exponential growth of greed. The vampyres have gotten really thirsty and are no longer content with beneficial bleeding, but drain their victims dry.
Agreed: Vampires. Parasites, large & small, all milking the national credit teat, their greed & wish-fulfillment fantasies driving every bubble for the last twenty years, all without the slightest idea that deficits DO matter.
Took a small government post-WWII & grew it into the malignant, ginormous, invasive monstrousity of today. Salvation through Federal Intervention. Nevermind paying for it. Just put it all on the credit card. Global Military Empire? Sure, charge it. Great Society? swipe yo EBT. On and on it goes: Scams, special interests & Bloodsucking Lobbies without end. Took a small national debt post-WWII & grew it into the nation-strangling abortion it is today. And now they want subsidized drugs & gold-plated healthcare so they can SUCK FOREVER.
What is this fundamental disconnect Boomers have about debt? My (college-educated) parents nonetheless say stupid shit like, "It's OK, we owe the debt to ourselves." That's great. Thanks for blithely putting your children on the hook for all your credit-fueled failure. Later generations get to suffer corporate slavery, currency devaluation, decaying infrastructure, loss of fundamental, Constitutional Rights, because Boomers "deserved" it all, wanted it now, and didnt care to pay for it upfront and honestly..
So no-- it's your debt, bitchez, and 'Tha X ain't paying.
Exactly. Sort of like real estate. It went up for so long, people thought it could only go up. However, the fact that it went up so long absolutely, positively guaranteed it would go down.
Normalcy bias is a big part of human wiring, because it usually works. It's a good idea to expect the sun to rise tomorrow like it always has. We're fucked, however, by cycles that are so long by human standards that they seem permanent.Their very length guarantees the mean-reversion - and then mean-overshoot - will be a bitch.
Yup. They just can't get enough of those "assets."
@ Kick_the_Kan,
no big deal. We've been bankrupted and defaulted berfore. Twice to be exact.
TIC TAC .........
TIC TAC.....
TIC TAC....
Dear Mr. LH,
Fine, fuck you I ain't gonna work on Maggie's farm no more.
Now come collect, I dare you.
-The "tenants" of the corporation of the united states
Dear U.S.A.,
please cash out and take your business to another planet. We do not want you here anymore.
Rgds.
Your masters
Dear Mr. Hugh-Smith,
In response to your letter, we must remind you -- if we may mix metaphors, that dollars are like Doritos: we'll make more !
Thank you for your interest in our organization.
Have a wonderful day !
The U.S.A.
Cc: The Global Bond Market
Ha,Ha--The bottom line in its essence. BINGO!! Milestonews
Dear Globalites,
Please stop from fist fucking me and mine. Growing numbers are becoming aware of your endgame. Show yourself, so we can reciprocate with the foot fucking, you so truly deserve. I bought a special steel toe boot, for the occasion.
Signed,
Good people of the world.
CHS is right, but the long bond has already recovered almost all of the drop from that bad 30 year auction...something wicked this way comes (bondzilla), but I fear he is still a year or two away from Greecing the US.
Those, sir, are as good as money. Those are IOU's!
Go ahead and add it up, every cent's accounted for. Look, see this? That's a car. 275 thousand. Might wanna hang onto that one.
http://www.youtube.com/watch?v=7GSXbgfKFWg
One of my favorite all-time movies.
Yes but at least we have that dude in Denver that plays football real good.
Did you see all those 99%'rs in the Denver stadium worshipping the 1%'rs on the feild?
The NFL is a national security issue tracked at the highest levels of government. Daily briefs quite literally include various college and professional football events as items of interest. Right there next to G20 meetings, Bilderberg meetings, and the state of the Union speech delivered by the POTUS.
The ciruses are crucial to the maintenance of order in a collapsing empire.
Yes, the USA is overdrawn, and we're going to pull a Greece on the world, just as soon as the fascist police state is put into place to control alll the free and sovereign men and women of America.
"Oh, no biggie.. I'm going to Hawaii"
"Dear U.S.A.--your overdraft protection is about to be pulled."
The USSA is the world's overdraft protection. That's why until someone truly challenges them with an alternative reserve currency, they will continue dipping into their overdraft money printing machine, bailing themselves out and every other welfare nation that comes asking.
Maybe China? But not as a challenge to the dollar, it would be more akin to taking us down with their sinking ship. They hate us and if they get the hard land everyone is predicting I've got to think they unload US debt in the process.
amen! pass the ammo.
Got Kalashnikov?
Nope. Got Kadarshian?
ori
...and Beretta, Mossburg, Remington, Wnchester, High Standard, Webley and Mariln.
Obama is overheard shouting in the Oval Office..
"I don't care what those Zerohedge guys report, get on the phone with Bernanke and have him order 50 more super turbo Hewlett packard printers and tell him to print as much as he needs to until I am re elected, because once I am done with my 2nd term, myself and my big fat assed wife can ride off into the sunset and leave this mess for the next guy..
I mean isn't that what all presidents do Joe?
...of course Barry, I mean what the fuck do I know, my job is too keep those fucking Chinese happy or you and your fat assed wife will not be riding off into any sunset!"
The maid in the Oval Office is heard mumbling under her breath "what a pair of idiots, I can't believe I voted for them"
Note to self: Need to do an Ogolfer/ZH "Hitler's Bunker" re-dub soon.
So what? my uncle "the fraud FED" has the money.
The government can't be over-drawn, they still have checks.
I would like to respond, on behalf of America:
Eat me, loser. All I have to do is default, Mr. Global Bond Market, and you become poor as shit, yet I will still be the most resource rich country on the planet, populated by the brightest and bravest men ever to inhabit this planet. So shut your pie-hole and enjoy the fraction of a percent I allow you to be paid on the money I happily squander.
Yours Truly,
America
Really..... ? What's a liquid enough.., alternative market
Ok, lets be honest. How many ZH readers checked their savings account balance seconds after this was posted?
you mean my 'imaginary' fiat 'fiduciary'? they are just numbers on my computer screen, and sometimes i seriously doubt if they are 'real' or not anyway.
at the very least i use a credit union for my necessary evil means.
I've already done my run on the bank. My open accounts are just an illusion for the banksters now.
The central banks of the world have so ruined the markets...what markets???
Dear The Global Bond Market
I have noticed that you have written to one of are clients, the USA, about the possibility of increasing the rates on their overdraft to maintain integrity of the system.
I would like to point out that any raise in rates will not be tolerated as low rates are necessary to ensure the affordability of the debt and increase economic growth. We ensure you that we will maintain integrity of the system by purchasing the debt and we will ensure the USA is able to finance its activities indefinitely.
Yours truly,
The Fed
This has to be THE most awesome comment EVVVERRRRRRRR
Dear Global Bond Market,
We are deeply sorry for this misunderstanding. We have not looked at our statements for over 950 days. Is there any chance you have been mailing them to Senator Harry Reids office? He never opens them!
Regards,
Congress
The title of this article made me chuckle, but it's still an understatement. It's worse than merely "overdrawn". It's a "black hole" of debt!
Didn't you mean "black swan" of debt?
One more nail in the economic coffin.
Brilliant - made my day
ah,... the simple things in life
If we all know that dollars are created by the Fed, isn't it inevitable for the country to run a deficit? If each dollar must be borrowed...?
Governments borrow so they can maintain the empty promises the citizens elect them for in the first place.
Borrow from whom? (who?)
Borrow from whom? (who?)
Central Banks and/or wealthy countries. The loan isn't repayable on demand so it's better than printing money. Printing money is a last resort reserved for when you can't pay your debt. That's where we're at now.
Just waking up are we? Yeah, John Kennedy tried to return the U.S. to printing it's own debt-free money.
Yes he did. And yes they did.
And obviously not just waking up. Simply facinated by this website's acceptance that the Fed is BS, while at the same time being obsessed with paying the Fed back. Makes no sense. Why pay any central bank back? All they did was create money out of thin air. Give them an annual budget of $10M to run the glorified excel spreadsheet, call it an exchange, and be done with the whole thing. Every year they can hand out $10,000 to everyone, and let the chips fall as they may.
Raise the interest rates then.
Congress has not done the work they were hired to do.
I remember when it was a little bit of debt in Carter and Regean time. And trickle trickle trickly to Clinton.
Obama gets elected and BOOM! Spend all the money in the free world cannot cover all the charges.
This is a Generational Abuse on a very large scale and will not stand.
Then again...
I pretend to work, you pretend to pay me, tax man pretends to be paid and the billing for the landlord, homeowner etc pretends to be paid with the credit card that the banks love to issue while everyone sits in school.
Must make those 20 something skins crawl being shoved into a chair row next to a bunch of wrinkly indebited old fucks who have nothing to say and all eyes.
The level of apathy is fucking amazing. The ship is going down and the passengers are still chilling out on the veranda.
USA INC
purveyors of fine fudge and numbnuttery
Interest on the debt was $454 billion in Fiscal Year 2011, the highest ever. That's despite lower interest rates. The interest on the debt is the fifth largest Federal budget item, afterDefense and Security spending ($890 billion), Social Security ($730 billion) and Medicare ($490 billion). (Source: U.S. Treasury, Interest)
scary calculator here.
"The greatest shortcoming of the human race is our inability to understand the exponential function."
http://www.youtube.com/watch?v=F-QA2rkpBSY
"The greatest shortcoming of the human race is our inability to understand the exponential function."
man is descended from monkeys, the world was created in seven days, ergo, a seven day old monkey stole all the money and crashed the ponzi
NEVER fall for the Orwellian propaganda that equates US military spending with "defense" --- the vast majority of it has NOTHING whatsoever to do with honest defense, as most of it, like most of the current operations and actions of the US military, is offensive in nature.
Definitely looks like the big ZERO as in 0 should be the US of A's new nickname.
zero=someones boyfriend
zero=a numeral never used by the romans
zero- a wwII japanese fighter plane
zero=congress
zero=someone who never gets a date
zero=the number of calories in a soft drink that will disolve nails
zero=problems solved by the WBs
zero=how many real jobs have been created
zero=how much money MFG clients will get back
zero=what the full moon looks like when the smog clears
zero=how much disposable income you have
and finally
zero=the number of times Paul Krugman has probably had sex---with another person.
heck Im tired of zero---feel free to add to the nickname
ZERO OUT
Zero Hedge
the fee for this transaction is $1.50 do you wish to continue?
Devaluation...it's the Debtors best friend.
U.S.A. to bank......just try to repeal my overdraft protection, I owe you so much fucking money that I'll just tell you to shove it all up your ass. You thought it was bad when I had a mortgage default , just wait until I blow up your whole friggen bank by defaulting on everything I own. So I suggest you fire those printing presses up and lend me whatever I demand. Oh yeah did I mention that I have a big fucking army?
Not me speaking btw. Just my view on uncle sam's attitude.
BoobsBurgersBeersBombsGunsGoldGodGas(all)Gone
Fema 1
Fema 2
Go to the camps
So can you
http://confoundedinterest.wordpress.com/2012/01/12/federal-deficit-at-86...
Dear Global Bond market,
Let's not be silly. You have no choice, besides you lent our Japanese friends twice their deposits and the Italians and Greeks not too far off.
Please accept this finger as collateral for future debts and the gun behind my back as incentive.
Sincerely,
US Bond market.
Come hell or high water, nervous investors will always purchase Treasuries at the exact instant the SPY shows any sign of weakness.
ALWAYS, until they don't. You'd be "great" at Forex trading.
Panicked horses have been frequently known to run into burning barns as well. After all, that is where they had always experienced safety and comfort before.
I can picture you leading such a charge.
Dear C.H.S.: Are you running out of things to write about?
Yawn...
Signed,
Bored and Unimpressed Readership
Dear U.S.S.A.,
All your AAA rating are belong to us...
Might as well see a headline that says the sky is blue...
Yeah, this article kinda sucks. I was much more entertained by this Golmdan Sachs Islamic Bond story...
http://dealbreaker.com/2012/01/goldman-sachs-loses-another-demographic/
actually, i kinda liked the article. sure beats reading about debt serfdom again................
the unborn are better aborted than born into debt slavery
Agreed. Bringing a child into this world is an act of cruelty.
The only exception is if you are a member of the top 5% or so and can be reasonably assured that your children will live a pleasureable life in comfort and safety. The rest are better off never having been born. There are far too many humans, and those born with nothing usually die with nothing.
but lord paul krugman just wrote an op-ed piece last week in which he told us we all didn't understand how sovereign debt in the US worked and that we should continue to spend and print money with no harm and we could even default if we wanted to. praise lord krugman!
in all honesty, i'm willing to sponsor someone going to princeton and punching this idiot right in his clown nose as that's exactly what he is. i'm good for 50 bucks towards going to bail out/lawyer fees for anyone close enough to the princeton area to go ahead and do this.
Dear Global Bond Market.
One of these days, the sooner the better, the United States will issue its own currency as opposed to creating debt. Don't worry, we will still pay you back, although at a reduced price.
Signed,
Bitchezz
Tyler, I'll be honest, I'm kind of on board with defecit spending right now--what else can we do? Two scenarios.
1. Continue the handouts, with those handouts buy cheap goods from China, China hands us the money back at low interest, hand it out again. Until China realizes that wealth is goods, not numbers in a computer, then the exchange rates will finally balance, we'll go through inflation(rich people get poorer), and then we'll have a manufacturing renaissance. Why stop the music? We're still waiting on 500 million rice farmers to start making stuff--all compliments of the naive chinese government exchange rate policy. My bet is this won't change until all the old people in China with one child start needing to spend their money instead of save it.
2. Stop the handouts, maintain the current level of debt, millions of people stop spending money, becuase they don't have any, more people lose jobs, deflation sets in and we let it happen, mass bankrupcy as debt loads are more than people can pay(rich people get poorer through capital loss). recession, more spending cuts, more job loss, all the undereducated parents move in with their kids, and finally we stop buying stuff from china becuase we don't have any money, prices get cheap, manufacturing renaissance. Why do it this way? Let China go through the pain of sending us unlimited wealth and then realizing that the numbers they kept adding up in the computer don't keep them warm at nigh, and that we've been diluting the debt for decades.
How is this a bad plan?
It's a great plan, right up to the point that people feel your currency is worthless. Bottom line, it's unsustainable, meanwhile you rob your elderly and poor through inflation. The government is a huge overhead cost to the private sector.
the poor getting robbed?????? oh spare me, PLEASE!!!! medicaid, section 8, snap program, public assistance, what robbery????? the only poor that getted robbed are the ones who are staying out late in the streets!!!
You should respond to the first poster, he's the one on board with the government spending. I'm middle class and feel like I'm getting poorer by the day via inflation.
Inflation doesn't rob the poor. It robs savers. As a whole (I know there are individual exceptions) savers have made too much in interest and capital gains over the last 15 years--and they refuse to spend the money. Enter inflation and government spending to rebalance.
GDP number is completely fake. If I take a shit the GDP goes up by $250,000.
Oh, so YOU'RE the one!
Dear Khazars. Stop causing wars all over my planet and enslaving my people with phony debts and false religions. I know your hearts and that you will never stop. So, I am coming swiftly to destroy you.
- I AM!
Reading this I got nostalgic for the 1992 election when Perot was so upset at the 4 trillion dollar debt. It's almost laughable at how innocent that all seems now yet the trajectory he forecast - social spending swamping everything else - was right on target. Wonder what he thinks now that the debt is almost four times the figure he was so alarmed about.
Surely Perot was a man ahead of his time. We laughed him off as a nut.
I suspect the MSM was responsible for that.
Well... here we are and.... this is NUTS!