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Obama Says Debt Deal Reached, America To Avoid Default, Or "Hank Gave Us A 3 Page Term Sheet; Boehner Gives Us A 7 Slide Powerpoint"

Tyler Durden's picture


In a much anticipated statement, Obama just announced that he has struck a deal with Boehner on the debt and the deficit, which will allow the US to avoid default. And also, as Reuters adds, Obama said that spending cuts included in deal to raise the debt ceiling will not happen so quickly that they will drag on the fragile U.S. economy. In other words, there will be no cuts for the immediate future. But there will be a single $2.4 trillion debt ceiling raise (based on a Joint Committee green light, LOL) just as Obama desired. And of course, there will be no tax hikes. Bottom line: there will be about $40 billion in actual, real spending cuts until the next, $16.7 trillion debt ceiling limit is hit some time in Q1 2013, at which point it will have to be raised to $20+ trillion. But no really, they are cutting spending and all that.

Just as Zero Hedge predicted all along.

Now comes the brief relief rally.

Then comes the hangover.

More from the AP:

Ending a perilous stalemate, President Barack Obama announced agreement Sunday night with Republican congressional leaders on a compromise to avoid the nation's first-ever financial default. The deal would cut more than $2 trillion from federal spending over a decade.


Default "would have had a devastating effect on our economy," Obama said at the White House, relaying the news to the American people and financial markets around the world. He thanked the leaders of both parties.


House Speaker John Boehner telephoned Obama at mid-evening to say the agreement had been struck, officials said.


No votes were expected in either house of Congress until Monday at the earliest, to give rank-and-file lawmakers time to review the package.


But leaders in both parties were already beginning the work of rounding up votes.


In a conference call with his rank and file, Boehner said the agreement "isn't the greatest deal in the world, but it shows how much we've changed the terms of the debate in this town."


Obama underscored that point. He said that, if enacted, the agreement would mean "the lowest level of domestic spending since Dwight Eisenhower was president" more than a half century ago.


Senate Democratic leader Harry Reid provided the first word of the agreement.


"Sometimes it seems our two sides disagree on almost everything," he said. "But in the end, reasonable people were able to agree on this: The United States could not take the chance of defaulting on our debt, risking a United States financial collapse and a world-wide depression."

As highlighted in a presentation just released by Boehner, here are the key point of the completed framework:

Emerging framework has three main features:


(1) cuts government spending more than it increases the debt limit;


(2) implements spending caps to restrain future spending;


(3) advances the cause of a Balanced Budget Amendment


Framework accomplishes this without tax hikes, which would destroy jobs, while preventing a job-killing national default.

For those who are interested, Boehner's whopping 7 slides on the proposed deal can be found here.



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Sun, 07/31/2011 - 21:05 | 1511045 anynonmous
anynonmous's picture

all praise to Obama

Sun, 07/31/2011 - 21:07 | 1511059 66Sexy
66Sexy's picture

So... Ater all that, its just a 2.5 trillion debt ceiling raise.

What a bunch of bullshit.

Sun, 07/31/2011 - 21:11 | 1511076 NewThor
NewThor's picture

ZOMG. can't wait to read this beauty! Anyone wanna guess the # of pages?

Sun, 07/31/2011 - 21:23 | 1511149 hedgeless_horseman
hedgeless_horseman's picture

"We are saved!  Praise Obama!"

-The Bankers

Sun, 07/31/2011 - 21:41 | 1511214 Fish Gone Bad
Fish Gone Bad's picture

In the future, it will be important to remember who were the debt criminals, and who their fellow conspirators were.  The US is so screwed up they do not even know how screwed they are.

Sun, 07/31/2011 - 22:09 | 1511302 IBelieveInMagic
IBelieveInMagic's picture

More likely the rest of the world is more screwed that USA -- we just put out the $ and the rest of world delivers! This elaborate dance was just to show the rest of the world that we take our reserve currency status responsibility very seriously but the outcome was predictable. Let us see if anyone has the balls to challenge this...

Sun, 07/31/2011 - 22:35 | 1511356 bankrupt JPM bu...
bankrupt JPM buy silver's picture

IB raises silver margins tonight.  I encourage everyone to pull their accounts at open.

Sun, 07/31/2011 - 22:47 | 1511380 TruthInSunshine
TruthInSunshine's picture

 Government of the banks & Wall Street, by the banks & Wall Street, for the banks & Wall Street.



Sun, 07/31/2011 - 23:50 | 1511483 redpill
redpill's picture

So now it becomes clear that the Republican party establishment would rather cooperate with Democrats than allow the tea party wing to dictate anything.  The One Party is alive and well.


Sun, 07/31/2011 - 23:54 | 1511492 DoChenRollingBearing
DoChenRollingBearing's picture

Green for you.  In fact, I think I'll just go give ANYONE who has ANY bad thing to say about ANY of our .gov a green.

"Serial Greener" now running through this thread.

Sun, 07/31/2011 - 23:55 | 1511490 FEDbuster
FEDbuster's picture

QE 2,800,000,000,000., bitchez!!

"The Federal Reserve has devalued the dollar 97% in just under 100 years, the next 97% devaluation won't take them that long." Dr. Marc Faber 2010

Hasten the Collapse, OBAMA 2012

Mon, 08/01/2011 - 00:40 | 1511570 chalcedonite
chalcedonite's picture

What do you mean it is not for the people:

By the way the origination of the quote was not by Lincoln but by Wycliffe in 1328:

This Bible is for the government of the people, by the people and for the people.

"Wycliffe and his associates defied church tradition by translating the Latin Bible into English, declaring in the preface, “The Bible is for the Government of the People, by the People, and for the People.” In 1382 Wycliffe was condemned as a heretic; in 1409 the Church ordered all copies of his Bible and other writings to be surrendered and burned. Wycliffe so angered the powers of the Church that although he died of natural causes, 44 years after his death the Council of Constance ordered that his bones be dug up and burned at the stake."


Mon, 08/01/2011 - 05:09 | 1511823 falak pema
falak pema's picture

And for good measure the same council invited Jan Hus, the czech Wycliffe of that age, to Constance as a diversion. The Constance papal conclave held in 1414-1415, a bit like the current Congress in gridlock today, was bickering about who was the real pope. They had a choice between three pretenders : The french pope in Avignon, the Tuscan pope in Pisa supported by the now powerful Medicis family of Florence, and the Roman pope proposed by the germanic holy emperor. As the ecclesiastic conclave was unable to resolve this MAJOR political fight, promoted by three rival political groups, they thought of an  expediency to while away their frustration. They invited Jan Hus to come present his deviant theories to them to DEBATE under safe passage to COnstance and personal protection offered by the Holy Roman Emperor himself, through heir apparent Sigismund of Hungary. Once in COnstance, the clergy immediately put him to trial for heresy, condemned him and burnt him at the stake! That's politics for you!

The papal conclave resolved itself when France lost a major battle at Agincourt that summer and that put an end to french pretentions. The papal seat moved back from Avignon to Rome. A NEW pope, not one of the three intial canditates, was elected and papal presitge and serenity was restored once again in Rome. 

Morality : We need change so that nothing changes!  Remember what Lampedusa said in "the Leopard" ...Keep your eyes on the POTUS and Congress. You'll see that history repeats itself...

Mon, 08/01/2011 - 06:38 | 1511871 chalcedonite
chalcedonite's picture

I am wondering if this video I posted is getting watched.  The entire system is a money laundering criminal syndicate organized to take, extract, and monopolize real wealth.  

Sun, 07/31/2011 - 21:31 | 1511186 smlbizman
smlbizman's picture

you know it is full of such bullshit like the 1099 frenquency bullshit , probably the rent free foreclosure solution, you know, to help housing...and on and on and.... 

Mon, 08/01/2011 - 00:12 | 1511522 Al Gorerhythm
Al Gorerhythm's picture

Here's the condensed DC interpretation.

Sun, 07/31/2011 - 21:15 | 1511089 FEDbuster
FEDbuster's picture

"Cut, Cap and Balance" replaced with "Spend, More and Borrow".

Hasten the Collapse, OBAMA 2012

Death by a 1,000 increses.

Mon, 08/01/2011 - 00:26 | 1511548 Mike2756
Mike2756's picture

Curious, wonder if the Fed will be forced to defend the currency at some point. The current regime had a chance to do serious infrastructure work and blew it. Are they planning on massive spending before the auto-cuts kick in?

Mon, 08/01/2011 - 07:38 | 1511942 New_Meat
New_Meat's picture

"... had a chance to do serious infrastructure work and blew it."

Au contraire, mon ami.  It was all part of the plan.

- Ned

{Getting sick of watching the boy-Plouffe on the TV yet?}

Sun, 07/31/2011 - 22:03 | 1511279 mickeyman
mickeyman's picture

They just delayed it keeping you all in suspense to the last possible moment so the populi would gratefully accept whatever got shat out.

Sun, 07/31/2011 - 23:23 | 1511444 monkeyboy
monkeyboy's picture

An interesting comment that was posted on the MSNBC article by one of the readers in response to another commenter.   



======== ======== ======== ======== ========
The U.S. Congress sets a federal budget every year in the trillions of dollars. Few people know how much money that is so we created a breakdown of federal spending in simple terms. Let's put the 2011 federal budget into perspective:

U.S. income: $2,170,000,000,000
Federal budget: $3,820,000,000,000
New debt: $ 1,650,000,000,000
National debt: $14,271,000,000,000
Recent budget cut: $ 38,500,000,000 (about 1 percent of the budget)
It helps to think about these numbers in terms that we can relate to. Let's remove eight zeros from these numbers and pretend this is the household budget for the fictitious Jones family.

Total annual income for the Jones family: $21,700
Amount of money the Jones family spends: $38,200
Amount of new debt added to the credit card: $16,500
Outstanding current balance on the credit card: $142,710
Amount cut from the current budget: $385
So in effect last month Congress, or in this example the Jones family, sat down at the kitchen table and agreed to cut $385 from its annual budget. Cut $385 of spending in order to solve $16,500 in deficit spending? Will this work? Hmmmmmmm!

It is a start, although hardly a solution.

Now after years of this, the Jones family owes $142,710 of debt on its credit card, and can barely pay the interest each month.

You would think the Jones family would recognize and address this situation, but it does not! ............... Neither does Congress.

The root of the debt problem is that the voters typically do not send people to Congress to save money. They are sent there to "bring home the bacon" to their own home state. Sort of like the "Gimmee Tribe".

To effect budget change, we need to change their job description and give Congress new marching orders.

It is awfully hard (but not impossible) to reverse course and tell the government to stop borrowing money from our children and spending it now.

In effect, what we have is a reverse mortgage on the country. The problem is that the voters have become addicted to the money. Moreover, the American voters are still in the denial stage, and do not want to face the possibility of going into rehab.

======== ======== ======== ======== ========

Sun, 07/31/2011 - 23:58 | 1511500 Cursive
Cursive's picture


Thanks for re-posting.  That's a really good example of the Ponzi we are in.  Man we are screwed.  Nights like this remind me why prepping has become a national pasttime for some.

Mon, 08/01/2011 - 01:42 | 1511686 Id fight Gandhi
Id fight Gandhi's picture

But the jones can't print money. USA can.

Sun, 07/31/2011 - 21:12 | 1511087 Id fight Gandhi
Id fight Gandhi's picture

Here comes qe3 too.

Why not just put that in th CONstitution now. Free money for the rich and fuck every working person.

Sun, 07/31/2011 - 23:51 | 1511487 DoChenRollingBearing
DoChenRollingBearing's picture

QE-to-infinity, that's it.

I am appalled that even the Republicans want to destroy our country too.

Getting off the grid, leaving the country (if you have money), buying gold and/or many other things need to be moved to the top of EACH OF OUR to-do lists.

Cognitive Dissonance wrote a timely a piece theree at the top.  Well worth the ffort to read it.  It's our fault too.


-2.7 trillion MORE junks to you .gov.

Mon, 08/01/2011 - 00:05 | 1511511 Cursive
Cursive's picture


I am appalled that even the Republicans want to destroy our country too.

You know I respect you as a fellow zherohead, but I gotta call bullshit on this Republican love. I don't know, maybe I misread you and you were being sarcastic. Boehner got no concessions and he "capitulated".  I put quotes around the capitulation because his intentions were not sincere.  Oh well, another log on the funeral pyre of a once great and proud nation.

Mon, 08/01/2011 - 00:37 | 1511563 Vic Vinegar
Vic Vinegar's picture

+1 to respect to the old-school.  You are correct Cursive.

 Re: DoChen's comment: It's our fault too...Bull-fucking-shit.  We were born into this dude.

Mon, 08/01/2011 - 01:51 | 1511690 Richardk888
Richardk888's picture

It is our fault.  The American people have stood by and allowed this to happen over the span of the last 100 years.

People should be in the street right now protesting this atrocity that is occupying the three branches of government.

"The world is a dangerous place, not because of those who do evil, but because of those who look on and do nothing."
Albert Einstein

 "All tyranny needs to gain a foothold is for people of good conscience to remain silent."                       Thomas Jefferson


Mon, 08/01/2011 - 06:10 | 1511856 KowPie
KowPie's picture

You can go to the streets and protest until the Kows come home. It would make good soundbites and great fodder for all of the corrupt mass media but that's all it would accomplish at this stage. Take it up a notch with armed insurrection and prepare for your lunchbox to be stuffed with gas grenades and hot lead.

The only solution is to keep feeding the little boy standing on the kitchen chair more rope until he has enough to loop it from his neck over the rafter. And then his playmates will kick the chair out from under him and wonder why the game is suddenly over. They'll keep printing and spending until the raft goes over the edge of the waterfall and won't stop a second sooner, you can "bank" on it.

Mon, 08/01/2011 - 01:34 | 1511677 grey7beard
grey7beard's picture

.>> even the Republicans want to destroy our country too.

As this place is crawling with Republican Party cheerleaders, could one of you please remind me of the last time the Republicans did something good for the country.  Does the Gramm-Leach-Blailey bill ring a bell with any of you folks?

Sun, 07/31/2011 - 21:26 | 1511154 SloMoe
SloMoe's picture

So, all the little girls in Washington DC can go back to playing jacks, and Obama won't miss his tee-off tomorrow. I'll bet he, at least, is relieved...

Sun, 07/31/2011 - 22:10 | 1511304 Translational Lift
Translational Lift's picture

Yea....CONgress and the administration just relieved all over the US people...........

Sun, 07/31/2011 - 23:29 | 1511457 GoinFawr
GoinFawr's picture

Are you feeling that warm trickle down yet?

Mon, 08/01/2011 - 06:12 | 1511857 KowPie
KowPie's picture

That's why it's called "GOOberment"

Sun, 07/31/2011 - 22:01 | 1511274 NumNutt
NumNutt's picture

Wouldn't it be funny as hell if this gets defeated in congress due to the lack of democratic support? After all that high five'n by all the leaders, what would Obama say then?

Sun, 07/31/2011 - 23:30 | 1511460 I am a ..
I am a ..'s picture

Wouldn't it be funny as hell if this gets defeated in congress due to the lack of democratic support? After all that high five'n by all the leaders, what would Obama say then?

Still the possibility that the 'Debt Deal' could be a trap.  Bushwhacking coming up at the OK Congress Corral?????

Mon, 08/01/2011 - 00:57 | 1511608 Yen Cross
Yen Cross's picture

-44 to +51... Where do I mail the invitations?


                  YEN (DOT)? (: Sarc

Sun, 07/31/2011 - 21:04 | 1511048 razorthin
razorthin's picture

So the corpse avoids mutilation.  Whew.

Sun, 07/31/2011 - 21:12 | 1511093 Doyle Hargraves
Doyle Hargraves's picture

More fresh brains to keep the zombie going...

Sun, 07/31/2011 - 22:25 | 1511340 old naughty
old naughty's picture

Hannibal and us.


Sun, 07/31/2011 - 21:21 | 1511110 razorthin
razorthin's picture

So we go from -$10T to -$15T in 5 years, and we are supposed to be giddy about a $1T reduction over 10 years.  What kinda moron buys into this (literally)?  And holds beyond Tuesday, that is.

Sun, 07/31/2011 - 21:44 | 1511225 Fish Gone Bad
Fish Gone Bad's picture

Apparantly a lot of elected debt criminal morons

Sun, 07/31/2011 - 22:06 | 1511288 HoofHearted
HoofHearted's picture

I'm that moron! I've bought several gold and silver coins at auction this evening. Prices are better than ever. Nobody wants real money when there will be BennyBux to go around.

Sun, 07/31/2011 - 21:05 | 1511051 buzzsaw99
buzzsaw99's picture

1) brief relief rally

2) brief bond crash

3) eternal QE

Sun, 07/31/2011 - 21:08 | 1511067 knukles
knukles's picture

WHich means business as normal....
Invest as normal.... Gold, silver, non-US dollars, Swissy, TIPS... etc.

Sun, 07/31/2011 - 23:58 | 1511501 DoChenRollingBearing
DoChenRollingBearing's picture

Gold and silver, yes.

I wish I could hand out more thn one greenie at a time.

Mon, 08/01/2011 - 00:59 | 1511614 Yen Cross
Yen Cross's picture

 +1 for the " Hell " of it Buzz...


Sun, 07/31/2011 - 21:05 | 1511052 Bent Nail
Bent Nail's picture

One trillion in deficit reduction over 10 years. Pure magic. How did they do it?

Sun, 07/31/2011 - 21:35 | 1511198 CrashisOptimistic
CrashisOptimistic's picture

It's not magic.

It's serial backstabs.

Did you see that part about Medicare benefit *providers* are the ones cut, not the benefit recipients?

That's what the AMA gets for supporting Obamacare.

Sun, 07/31/2011 - 22:08 | 1511296 hedgeless_horseman
hedgeless_horseman's picture

...and don't forget about those cocksuckers at the MGMA.

Sun, 07/31/2011 - 23:53 | 1511491 sun tzu
sun tzu's picture

Which means fewer doctors will accept medicare patients. AMA and AARP fucked over their members by supporting 0bozocare

Mon, 08/01/2011 - 00:00 | 1511502 DoChenRollingBearing
DoChenRollingBearing's picture

That's because they're both corrupt.

Green to anyone who hates all this!  Wheeee!

Sun, 07/31/2011 - 21:06 | 1511055 max2205
max2205's picture


Sun, 07/31/2011 - 21:06 | 1511056 Terminus C
Terminus C's picture

yay... nothing unexpected or changed. 

Status Quo to hell bitchez.

Sun, 07/31/2011 - 21:07 | 1511060 tom a taxpayer
tom a taxpayer's picture

It ain't over til the fat lady sings.

Sun, 07/31/2011 - 21:24 | 1511151 bigkahuna
bigkahuna's picture

She has definitely not.

Sun, 07/31/2011 - 22:03 | 1511280 smlbizman
smlbizman's picture

correct...they still have to vote....and i can't imagine the the only sanity in dc will just say yes...

Sun, 07/31/2011 - 22:08 | 1511295 HoofHearted
HoofHearted's picture

But Hillary is warming up. Did you see her picture on ZH the other day? Jabba the Hut... 

Sun, 07/31/2011 - 22:38 | 1511367 ceilidh_trail
ceilidh_trail's picture


Sun, 07/31/2011 - 21:07 | 1511061 max2205
max2205's picture

1 can. 2 cans 3 cans 4 cans 5 cans.......zzzzz......better than counting sheep

Sun, 07/31/2011 - 22:12 | 1511312 Lower Class Elite
Lower Class Elite's picture

Beans or bullets?

Sun, 07/31/2011 - 22:19 | 1511328 kito
kito's picture

if its dilbert, beans...

Sun, 07/31/2011 - 22:40 | 1511366 Ms. Erable
Ms. Erable's picture


Boehner: "Hey, the road's washed out ahead. Maybe we shouldn't kick it again."

Reid: "Naw, go ahead - I wanna see how far it is to the bottom."

Obama: "Oooh, lemmedoooit! Lemmedooit! I got a bigger foot!!!" <pulls leg back for the next kick>

Boehner: "Wait a sec! Lemme put a pebble next to the edge to stop it from falling."

Reid: "That's not a pebble - it's almost a full-fledged rock! Here, use this one." <places 4mm spot of dirt near edge of ravine>

Obama: "No prob - I can miss that easy!"

*KICK*tingclangclang.... <silence>

All <in unision>: "Ooops."

Obama: "Hey, at least it won't hit anyone important down there. Shit, I'm late for my tee-off!"

Sun, 07/31/2011 - 21:07 | 1511062 djCandi
djCandi's picture

America is a fundamentally unbalanced society. The capitalist system is extraordinarily efficient at creating innovation and technical brilliance, but in any complex system their needs to be balance.

I just watched a show about the newest US Coast Guard vessel running drug interdiction. This is basically a billion dollar piece of kit, with a permanent on-board helo and three tactical fast boats with their own separate launch on the back of the ship. Never mind operating costs (mtce and crew). The sophistication on all elements of this thing (hardware, electronics, training) was ledgendary--could have been a floating, fighting space shuttle.

So, what was it doing to add value to the US state? It's stated purpose was (trying to) catch fast boats moving barrels of cocaine. It's the US Coast Guard, right, so you would expect them to be operating off the US coast. Nope. Trying to catch speedboats running between Colombia and Panama. Yes, Americans are paying for these services! It's all very cool, and yes it provides good mid-paying jobs, but it's sadly, pointless.

Back to balance. This boat is one example of many hundreds of similar security state programs. These are structural. Imagine how much nicer your home would be if you dismantled some of the unnecessary, over-the-top technically sophisticated (when it's military, that's code for EXPENSIVE) web that's been weaved around the world, and spend it in ways that sustain jobs and deal with social ills. It's about balance. You cannot drop the security ball, but you cannot drop the domestic social cohesion ball either. The debt problem is a story of these imbalances in America.

Sun, 07/31/2011 - 21:11 | 1511080 pods
pods's picture

They could have beached it in Mena and caught all the cocaine they wanted to.

Does this vessel have a large cargo hold?  Home port of NYC?  

Probably a transport.


Mon, 08/01/2011 - 03:34 | 1511775 AldousHuxley
AldousHuxley's picture

Just give those drugs out for free as much as druggies want. Then all the addcits will die off soon, and they won't need tax payers money to support them in jails or rehabs. Give it about 5 years.

Sun, 07/31/2011 - 21:12 | 1511094 Mike2756
Mike2756's picture

They could have built a bunch of upgraded pt boats for what they paid for that.

Sun, 07/31/2011 - 23:21 | 1511442 karzai_luver
karzai_luver's picture

We could just BUY THE FUCKIN DOPE for the money we spend trying to stop it and then give the shit away.


Makes as much sense as anything.




HMMMMMMMMMMMMMMMMM, where would the YOBS come from? and all that neat security stuff?

Can you say multipliers butcheszzzzzzzzzzzzzzzzzzz.




Sun, 07/31/2011 - 21:41 | 1511212 Greenhead
Greenhead's picture

The social cohesion problem will not be resolved until the educational problem is taken care of.  When half of the country's taxpayers pay no income tax and rely on the other half for the freebies, there will be an ongoing "social cohesion" problem.  We are witnessing an ideological clash that is only beginning and "social cohesion" will go out the window until we have some measure of agreement on what kind of nation we will be.  Not everyone wants to be a eurosocialist type nation.

Sun, 07/31/2011 - 22:56 | 1511400 Clearly_Irrational
Clearly_Irrational's picture

There is a difference between "no income tax" and "doesn't pay taxes".  I make quite a bit more money nowadays, but back when I was in the "no income tax" category making near minimum wage a depressing amount of my wages still got siphoned off for various "non tax taxes".  At that income bracket any income that actually gets taken and not returned is on about the same level as taking a farmer's seed corn since pretty much every dime is spent on actual requirements like housing, food, transportation, utilities and maybe if you're lucky medical care.  I'm not real fond of many of the programs our government has implemented at our expense, but I don't think arguing that people below the poverty line should pay a bigger share is really a rational argument.

Mon, 08/01/2011 - 02:52 | 1511753 ARW
ARW's picture

You paid a higher FICA rate than everyone else? Ok.

Sun, 07/31/2011 - 23:24 | 1511446 karzai_luver
karzai_luver's picture

You are a RIOT.

This bitch be a kleptocratic fascist "nation" by design.

Taxes are for little peeps and by the tone of your note here you is IT!

thx for your support. pull the plow bitch.




Sun, 07/31/2011 - 21:56 | 1511249 GeorgeHayduke
GeorgeHayduke's picture

Hell yeah they're gonna run that boat between Panama and Colombia. They have to keep the CIA's drug market safe from those wetback dealers in South America.

Sun, 07/31/2011 - 22:11 | 1511310 malikai
malikai's picture

See how kind and altruistic we are? We even go over there and fight our useless drug war in their waters with our civilian maritime rescue service. We are truly an enlightened people.

Mon, 08/01/2011 - 01:49 | 1511693 grey7beard
grey7beard's picture

>> I just watched a show about the newest US Coast Guard vessel running drug interdiction.

This reminds me of a story my friend back home on the waterfront just related to me.  The local marine patrol, now part of homeland security, just upgraded their boats with twin 500 hp outboards.  Word is, there is a larger engine coming out very soon, but they patrol is awash in cash, so they temorarily upgraded all boats to twin 500 hp obs.  When the new, large enignes come out in less than a year, word is all boats will then be upgraded to the larger models.  My friend spotted the local boat, probably $300K + worth, with two Darth Vader looking goons in black with guns and mace and tazers and radios in action.  What were they doing to jusitfy the federal bucks?  They had caught two young negro boys fishing in the marina.  These two gladiators, probably making $80K plus benefits, with their $300K + charriot, were running young negos out of the marina. 

Yeah, I guess that's socialism at work eh? There is no stopping this shit ball from going down.

Mon, 08/01/2011 - 02:35 | 1511739 RichardP
RichardP's picture

... when it's military, that's code for EXPENSIVE.

You are right.  Those boats are expensive.  Lots of workers got paid lots of money to build them.  Lots of workers won't make any money when you cancel the boat orders.  With no boat orders, the money gets spent somewhere else (different government purchase order, or taxpayer keeps the money and spends it).

At the macro level, your concept doesn't save money.  It just spends it in a different place.  Shifting spending around only hurts some workers by helping others.  Increasing or cutting government spending always has this effect.

Sun, 07/31/2011 - 21:08 | 1511066 pods
pods's picture

So can we all go back to buying PMs and burying hams?

This was a foregone conclusion.  The USA needs debt, it will get more debt.

On the bright side, it does buy us a few more years.  Get out of debt, avoid credit, and make the next chapter all the more difficult for them.


Sun, 07/31/2011 - 21:11 | 1511078 Prometheus418
Prometheus418's picture

Yes we can.

Though I don't know about burying hams- seems like it might attract scavengers.

I'll be sure to put the stay of execution to good use, myself.  After all, looks like silver is on sale again...

Sun, 07/31/2011 - 22:30 | 1511345 CompassionateFascist
CompassionateFascist's picture

This "buys" months, not years. At the rate the Ponzi-merchants are bleeding red ink, I wouldn't count on 2.4 trillion getting them thru the 2012 elections. Ponzi- Collapse: July-August 2012. Prepare.

Sun, 07/31/2011 - 22:52 | 1511388 Bananamerican
Bananamerican's picture

"On the bright side, it does buy us a few more years."

yea, i didn't get that either...YEARS??

Mon, 08/01/2011 - 00:39 | 1511568 pods
pods's picture

Well I have been surprised since 2008. I vividly remember seeing the market down 6-8 hundred. Even saved a screenshot of the DOWn down like 1k (misprint I think).

One thing I have learned is that this thing may go on alot longer than I had ever imagined.

I will stick with my couple of years guess.  I remember in early 09 a guy predicting (Daily Reckoning refugee board, thanks Da Bear!) currency collapsing soon after the '12 elections, as Obama would lose the CONgress and austerity would ensue.  That would lead to a deflationary spiral cured by hyperinflation and currency collapse.  I think that jeffolie sounds about right so far.  I have tried to step back from emotion, and see how the collapse would happen.  What the trigger would be, etc.  So far that prediction is the most probable game plan that I see.

I think that now with SS starting to bleed more, and medicare sinking fast we are near endgame.  We surely wont get out of 2014, when Obamacare goodies start flowing.  Of course, it was probably just passed to get the couple of years of tax revenue.

My guess is that private spending is done, and gov will be able to last into early 2013 before it all comes apart.  My company's margins are collapsing, and I hear it almost everywhere.  Main street is hanging on by their fingernails.  



Mon, 08/01/2011 - 11:20 | 1512693 Bananamerican
Bananamerican's picture


it's just that we've raised the DebtCeiling 10 times in 10 years and the burn rate has gone exponential...but then i never expected this level of can kicking...

we'll just have to wait and see

Mon, 08/01/2011 - 00:06 | 1511516 DoChenRollingBearing
DoChenRollingBearing's picture

Greened you pods and those commenting so far under you.  I agree with the repliers: MONTHS.

Use these months wisely.  Keep stocking up.

Train wreck ahead.

Mon, 08/01/2011 - 00:44 | 1511579 pods
pods's picture

About as prepared as I can be DCRB, but any more time is helpful!

No worries here if it is a couple of months, BOB is packed and ready to go.  We are near a nuke plant, so always have one packed.  

Gonna have to learn Espanol to open up your territory for the move.  Mike Adams (Health Ranger) had a beautiful spread in Ecuador.  



Mon, 08/01/2011 - 02:12 | 1511721 IQ 101
IQ 101's picture

This is a sort of reprieve for some of us folk who desire more Gold and Silver than they have, 6 to 12 months and a few Comets and Asteroid events, the shit should be irrevocably hitting the fannys in DC.

Elenin is a mystery, Toutatis is a Bull in a China shop.

Mix it all up with Comets Honda and Levy, Mayan calender, and other

elements and it add's up to AN EXPECTED EVENT.

i come to Z.H to learn the of the arcane world of finance and in a year or two have become better informed outside of my usual fields of information exposure and i thank you, even you commie shill bastards.

My point is this, I do not think our Govermonster is as idiotic or malicious as they might desire themselves to appear to be,

These noodleheads have multiple telescopes floating around the Sun,

You don't,I don't, they are not doing it for entertainment, multiple governments are ARDENT about their space observation programs,

If it appears that they are kicking the can down the road, it is only because they ARE kicking the can down the road,why?

Because they fully expect an event, from space.

If making a few $$$$ is dependant on FORESIGHT regarding the markets (If thou be a market player) then all possible data should be considered in the long term?

Their is more afoot now than most people will consider.

As J.P. Morgan said, "millionairs don't believe in astrology,Billionairs do".

If I had more time I would tell you about Ivan Panin and his lifes work.

But,alas i must go,as Meg Ryan is about to do the orgasm scene on tonights Chick Flick.

Mon, 08/01/2011 - 02:46 | 1511748 RichardP
RichardP's picture

Because they fully expect an event, from space.

King of Kings, White Horse, Trumpets, and stuff.

Sun, 07/31/2011 - 21:09 | 1511068 Stoploss
Stoploss's picture

S&P says deficit of 9% of gdp too high. 3T in long term cuts not good enough. They want 4 period, they want them in the short term also. Threaten downgrade in the face of default avoidance.

Moody's too busy taking it in the ass right now to comment coherently.

Sun, 07/31/2011 - 21:10 | 1511075 caerus
caerus's picture

this is bullish for powerpoint

Sun, 07/31/2011 - 21:11 | 1511079 jkruffin
jkruffin's picture

Once again, the American people on the verge of getting sold out to a bunch of bankers in the middle of the night over the weekend.  Go figure......If they pass this crap, I will never walk to a voting booth ever again, why waste my time..

Sun, 07/31/2011 - 21:15 | 1511106 pods
pods's picture

Welcome to the desert of the real.

A different take on voting:


Sun, 07/31/2011 - 21:20 | 1511136 Hansel
Hansel's picture

Notice Congress has to vote on the Joint Committee's "cuts" by December 23rd.  I wonder what kind of shit will be pushed through right before Christmas this year.

Sun, 07/31/2011 - 21:30 | 1511178 disabledvet
disabledvet's picture

i agree regaining our trust will be a tall order. never underestimate a politician however:

Sun, 07/31/2011 - 21:12 | 1511081 Cognitive Dissonance
Cognitive Dissonance's picture

The wicked debt witch is dead, the wicked debt witch is dead.

Sun, 07/31/2011 - 21:15 | 1511105
Sun, 07/31/2011 - 22:30 | 1511346 tip e. canoe
tip e. canoe's picture

nice one crock.   here another:

on the run in the tornado

not the original sync, but good nonetheless

Sun, 07/31/2011 - 21:36 | 1511175 BlackSea
BlackSea's picture

Ahem, excuse me. To paraphrase an old joke:

Q: Is it true that the wicked witch is dead?

A: Generally yes. However, it is not a witch, it's hyperinflation, and it is not dead but born.


Sun, 07/31/2011 - 21:12 | 1511082 Tejano
Tejano's picture

Whew! That was a close call!
/sarc off

Sun, 07/31/2011 - 21:30 | 1511180 living on the edge
living on the edge's picture

It really was close. Now America can continue to print money out of thin air and try to inflate our way back to the old fraudulent prosperity.

What a joke America has become!

Mon, 08/01/2011 - 00:12 | 1511524 DoChenRollingBearing
DoChenRollingBearing's picture

A bunch of ZH-ers (alas, me not among them...) said this was EXACTLY the way it would play out, I had been hoping Boehner would would be a man and stand with the Tea Party Republicans.

Silly me.

Gold & Silver, bitchez

But at least I am having fun going on my greening bender here on this thread!  All you have to do is insult .gov or say anything nice about gold, and you're green, probably by many.

Mon, 08/01/2011 - 01:14 | 1511647 Drag Racer
Drag Racer's picture

this was expected. what has me worried is what crap they will hide in the bill. some Internet restrictions, gun control, who knows. This was just a lot of show to get nothing passed so they must be trying to hide something big.

Sun, 07/31/2011 - 21:11 | 1511084 SokPOTUS
SokPOTUS's picture

These guys (and gals) are all high on SQD (Status Quo Dust).  Addicted to Normalcy Bias.  Bring on the Downgrades!



Sun, 07/31/2011 - 21:13 | 1511085 SokPOTUS
SokPOTUS's picture

Too bad.

Sun, 07/31/2011 - 21:12 | 1511086 useless_fact
useless_fact's picture

... And the common sheep believe that we are saved.

Sun, 07/31/2011 - 22:05 | 1511283 tsx500
tsx500's picture

Yup-SAVED ! What's goin on w/ Lindsey Lohan ? ?

Sun, 07/31/2011 - 22:31 | 1511347 oogs66
oogs66's picture

More journalists believe the hype than ordinary citizens The politicians only fooled each other and the media this time

Sun, 07/31/2011 - 21:12 | 1511090 nonclaim
nonclaim's picture

(1) cuts government spending more than it increases the debt limit;

If this was real in any time frame no increase would be needed...

Sun, 07/31/2011 - 21:13 | 1511096 long-shorty
long-shorty's picture


Sun, 07/31/2011 - 21:31 | 1511185 bigkahuna
bigkahuna's picture

they fuck anyone they want to. justice = just us

Sun, 07/31/2011 - 22:01 | 1511272 long-shorty
long-shorty's picture

What asshole lawyers gave this a thumbs down while deep throating Pete Stark? Who in their right mind thinks we should balance the budget by cutting medicare payments to physicians? Physician salaries are less than 6% of health care expenditures.

This is fucked up. I left medicine and started a small investment business, and within two years my income had increased by 400%. Keep shitting on doctors and see how many good ones are left in 5, 10, or 20 years.

Sun, 07/31/2011 - 23:29 | 1511455 karzai_luver
karzai_luver's picture

Cuba baby, weather is nice docs are cheap and cars still have some class.


Merdical paradise far as I can see.



Mon, 08/01/2011 - 00:00 | 1511503 sun tzu
sun tzu's picture

Is that why Castro leaves everytime he needs surgery?

I'm sure Cuba has all the latest medical devices and top notch doctors.

Mon, 08/01/2011 - 02:32 | 1511737 grey7beard
grey7beard's picture

>> I'm sure Cuba has all the latest medical devices

You think that migh thave something to do with the American sponsored embargo?  Castro and the government have plenty of issues, but at least they have tried to give the people of their impoverished nations basic health care at affordable prices.  

Sun, 07/31/2011 - 23:29 | 1511456 LouRukeyser
LouRukeyser's picture

Not this asshole lawyer. +1

Sun, 07/31/2011 - 23:33 | 1511465 Stares straight...
Stares straight ahead's picture

So, what will you be buying at the open tomorrow?!

Mon, 08/01/2011 - 00:03 | 1511508 long-shorty
long-shorty's picture

everything except healthcare and defense.

Sun, 07/31/2011 - 23:55 | 1511494 dark pools of soros
dark pools of soros's picture

Didn't an iphone app replace doctors already?  

Mon, 08/01/2011 - 01:02 | 1511590 cranky-old-geezer
cranky-old-geezer's picture

Physician salaries are less than 6% of health care expenditures.

Yep, about what street-corner drug dealers typically get. 

Up-line suppliers get the rest.  In your case big pharma.

One good thing about Obamacare is putting more street-corner drug dealers (physicians) out of business.  Americans' health will actually start improving.

Sun, 07/31/2011 - 21:13 | 1511098 NumNutt
NumNutt's picture

OK as you were, nothing to see here....back to your bread lines.....

Sun, 07/31/2011 - 21:21 | 1511138 Mike2756
Mike2756's picture

Buck is going nowhere, glad we have that "wealth effect".

Sun, 07/31/2011 - 21:13 | 1511099 Lmo Mutton
Lmo Mutton's picture

So do I sell the PM's or not?

Sun, 07/31/2011 - 21:18 | 1511107 NumNutt
NumNutt's picture

SELL!!!! all bets or off! they fixed everything with the stroke of a penn! They filled the grand canyon, mended the crack in the liberty bell, and gave Nancy another botox injection. The world is all good again......Hmmm wait a minute, they are all slapping each other on the back and shit, but no one has actually signed anything yet....might want to hold onto those PM's a little longer....

Sun, 07/31/2011 - 21:24 | 1511152 lawrence1
lawrence1's picture

Yeah, think I hold on to the PMs, deal signed or not, until a stable currency is in place, that is, until hell freezes over.

Sun, 07/31/2011 - 21:15 | 1511108 HungrySeagull
HungrySeagull's picture

I am seeing sellers stack up around me (Disclosure.. I am seller of PM Gold right now) faster than bids are.

Sun, 07/31/2011 - 21:34 | 1511193 bigkahuna
bigkahuna's picture

You guys keep on selling.

Sun, 07/31/2011 - 21:43 | 1511223 HungrySeagull
HungrySeagull's picture

Oh I might, sometime in the AM after the price doubled.

Sun, 07/31/2011 - 21:24 | 1511145 firefighter302
firefighter302's picture

Sell your PM's in light of more of the exact same policy that drove them up over the last many years ?

Did you forget the "<sarcasm on> or what?  I hope so....

My timeframe is beyond 2011 and I have a continuing need for green plastic boxes of money.   Sell now?   Not me, no way.  (However, I'm a physical position builder, not a short term SLV trader.) 

Sun, 07/31/2011 - 21:14 | 1511102 knukles
knukles's picture

Fuck it.
Time to catch "Breaking Bad" and "Masterpiece Theater"
Enough drivel for the day.

A late evening trivia quiz;
What were the names of the two moon men on Rocky and Bullwinkle?

(No cheating, surfing and browsing allowed!)
Winner gets an atta-boy, a pat on the head and a tube of KY for the ongoing screwing from the Empire.

Sun, 07/31/2011 - 21:24 | 1511148 nonclaim
nonclaim's picture

May I recommend Monsterpiece Theater, instead?

The 39 Stairs (of  debt negotiation)

Sun, 07/31/2011 - 21:24 | 1511150 tom a taxpayer
tom a taxpayer's picture

Boehner and Reid? Blankfein and Dimon? Geithner and Bernanke?

Sun, 07/31/2011 - 22:11 | 1511309 NumNutt
NumNutt's picture

Stinky & Pinky? Flush and Flow?

Sun, 07/31/2011 - 21:15 | 1511104 AmazingLarry
AmazingLarry's picture

Sweet, now I can buy that Corvette!

Sun, 07/31/2011 - 21:16 | 1511112 TSA Thug
TSA Thug's picture

ES up +20 points in overnight action.

Sun, 07/31/2011 - 21:16 | 1511115 holdbuysell
holdbuysell's picture

I'd like to see the timing of those spending cuts over the next ten years.

Sun, 07/31/2011 - 21:25 | 1511157 Hansel
Hansel's picture

It sounds like they used Boehner's bill for the cuts.  Here is the CBO score,

$22 billion reduction of the deficit in 2012, according to the CBO.  I find it incredible that the CBO can know that since Congress still hasn't passed a budget for 2012.  Whatever.

Sun, 07/31/2011 - 21:17 | 1511119 Pool Shark
Pool Shark's picture

And for those of you playing along at home; here's your final Box score:


Obama: +3

Boehner: +1

Reid: +2

American Taxpayers: -2.8 Trillion


Sun, 07/31/2011 - 21:51 | 1511239 Fish Gone Bad
Fish Gone Bad's picture


Sun, 07/31/2011 - 22:36 | 1511357 CompassionateFascist
CompassionateFascist's picture

And Pelosi skims off another $20 million.

Sun, 07/31/2011 - 21:17 | 1511123 Scipionz
Scipionz's picture

Kick that can down the hill!!! Until next time...

Sun, 07/31/2011 - 21:18 | 1511129 erg
erg's picture

Obama the Great and Terrible. The mummer of ceremonies speaketh.

Sun, 07/31/2011 - 21:18 | 1511130 Fix It Again Timmy
Fix It Again Timmy's picture

Why, everyone knows that the best way to get out of a hole is to keep on digging...

Sun, 07/31/2011 - 21:29 | 1511171 tom a taxpayer
tom a taxpayer's picture

It's a shovel ready project.

Sun, 07/31/2011 - 21:31 | 1511179 firefighter302
firefighter302's picture

Ben Bernanke actually said at a recent FOMC press conference, "we need to do a lot of digging to get out of the hole we are in."





Sun, 07/31/2011 - 22:14 | 1511320 MissCellany
MissCellany's picture

Keep digging, Benny boy, and you'll land us all in China. Oh, wait...

Sun, 07/31/2011 - 23:57 | 1511497 Captain Benny
Captain Benny's picture

I don't dig, I fly helicopters and drop money... don't you guys ever read any of the BS I write? - Capt Benny

Mon, 08/01/2011 - 03:49 | 1511782 AldousHuxley
AldousHuxley's picture

Ben has one job. print money. so digging would mean central banker code for more money printing.

Sun, 07/31/2011 - 22:05 | 1511284 erg
erg's picture

Dig a hole to China.

Sun, 07/31/2011 - 22:15 | 1511321 MissCellany
MissCellany's picture beat me to the punch line!

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