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The deficit is shrinking. The sequester is having an effect. A balanced budget amendment is necessary so that future Congresses don't burden the country with this bull shit again in the future.
I actually oppose a balanced budget amendment.
But anyway, what programs would you like to see cut to achieve reductions in spending? What will make GDP growth occur?
Boo boo won't go there. She'll respond with "increase taxes on the rich"...
I actually oppose a balanced budget amendment.
But anyway, what programs would you like to see cut to achieve reductions in spending? What will make GDP growth occur?
Boo boo won't go there. She'll respond with "increase taxes on the rich"...
Long term capital gains tax should be taxed like any other income. I like to see a reduction in military spending. A slow increase in the retirement age for SS and Medicare. Reform the tax code with only a single deduction to cover the poverty rate. Lower the tax rates in all brackets.
The GOP can try and live in la la land, the facts for those on planet earth are without question, the message not raising the debt ceiling would see the dollar crash,.
The GOP can try and live in la la land, the facts for those on planet earth are without question, the message not raising the debt ceiling would see the dollar crash,.
Last year, the federal government collected $2.3 trillion in taxes.
Why isn't that enough to pay for those activities for which fedgov is CONSTITUTIONALLY AUTHORIZED?!?!?!?!?!?!?!?!?!?!?!?
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Those talking points are so old I'd be embarrassed to repost them.
Large factors in Slick's alleged surplus were:
Tech boom, raising revenue
Collapse of the Soviet Union, allowing for drastic cuts to the military (remember the "Peace Dividend"?)
Ascendence of the GOP in Congress, which did actually control spending.
The GOP can try and live in la la land, the facts for those on planet earth are without question, the message not raising the debt ceiling would see the dollar crash,.
Last year, the federal government collected $2.3 trillion in taxes.
Why isn't that enough to pay for those activities for which fedgov is CONSTITUTIONALLY AUTHORIZED?!?!?!?!?!?!?!?!?!?!?!?
.
You're missing the point! fair enough deal with the debt but you can't undo whats been happening for the last 30 years overnight.
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Fitch Ratings is now sounding the alarm. It said last week it may downgrade the U.S. if the government doesn't raise the federal debt ceiling in a "timely manner," and it warned that a prolonged government shutdown would "damage perceptions of U.S. sovereign creditworthiness" and "signal that the U.S. government was in financial distress." Fitch is the only major ratings firm with a negative outlook on the U.S. rating. It gives U.S. debt its highest rating, triple-A, as does the other of the three leading ratings firms, Moody's Investors Service.
Fitch Ratings placed the U.S.'s pristine triple-A rating on watch for downgrade Tuesday as the federal government runs short on time to raise the nation's borrowing limit.
Fitch said prolonged negotiations over raising the debt ceiling, following similar talks in August 2011, could undermine confidence "in the role of the U.S. dollar as the pre-eminent global reserve currency, by casting doubt over the full faith and credit of the U.S." ...
Fitch said a failure by the government to honor interest or principal payments on U.S. Treasury securities would lead it to downgrade the U.S.'s sovereign issuer-default rating to "restricted default." It would also slash the affected issues to B-plus from triple-A. ...
Even as it warned of a potential downgrade, Fitch said it believes an agreement will be reached to end the current political impasse and raise the U.S. debt ceiling. Even if the debt limit isn't raised on or shortly after Thursday, Fitch said it assumes there is sufficient political will and capacity to "ensure that Treasury securities will continue to be honored in full and on time."
Fitch Ratings is now sounding the alarm. It said last week it may downgrade the U.S. if the government doesn't raise the federal debt ceiling in a "timely manner," and it warned that a prolonged government shutdown would "damage perceptions of U.S. sovereign creditworthiness" and "signal that the U.S. government was in financial distress." Fitch is the only major ratings firm with a negative outlook on the U.S. rating. It gives U.S. debt its highest rating, triple-A, as does the other of the three leading ratings firms, Moody's Investors Service.
Uneasy Investors Sell Billions in Treasurys - WSJ.com
Fitch Ratings is now sounding the alarm. It said last week it may downgrade the U.S. if the government doesn't raise the federal debt ceiling in a "timely manner," and it warned that a prolonged government shutdown would "damage perceptions of U.S. sovereign creditworthiness" and "signal that the U.S. government was in financial distress." Fitch is the only major ratings firm with a negative outlook on the U.S. rating. It gives U.S. debt its highest rating, triple-A, as does the other of the three leading ratings firms, Moody's Investors Service.
Uneasy Investors Sell Billions in Treasurys - WSJ.com
This should probably be a separate thread.
But if the gov't does actually default, what will that mean for us? I read this AM that some lenders are not taking short dated Treasuries as collateral. If Treasuries suffer a huge loss in value, many loans are collaterized with them. Banks have Tier 1 capital in Treasuries. If they lose that capital there will be enormous runs on those banks, with no FDIC to backstop it.
We will be back to a barter economy in no time.
This should probably be a separate thread.
But if the gov't does actually default, what will that mean for us? I read this AM that some lenders are not taking short dated Treasuries as collateral. If Treasuries suffer a huge loss in value, many loans are collaterized with them. Banks have Tier 1 capital in Treasuries. If they lose that capital there will be enormous runs on those banks, with no FDIC to backstop it.
We will be back to a barter economy in no time.
The monthly debt service on federal loan interest is $18 B....The Treasury takes in over $200B per month
I wonder if the Press is going to hit Obama and the Democrats with this?
In a memo being circulated on Capitol Hill Wednesday, Moodys Investors Service offers answers to frequently asked questions about the government shutdown, now in its second week, and the federal debt limit. President Obama has said that, unless Congress acts to raise the $16.7 trillion limit by next Thursday, the nation will be at risk of default.
Not so, Moodys says in the memo dated Oct. 7.
We believe the government would continue to pay interest and principal on its debt even in the event that the debt limit is not raised, leaving its creditworthiness intact, the memo says. The debt limit restricts government expenditures to the amount of its incoming revenues; it does not prohibit the government from servicing its debt. There is no direct connection between the debt limit (actually the exhaustion of the Treasurys extraordinary measures to raise funds) and a default.
I doubt it... But if it were an honest press they would.
Paying interest on the Treasury Notes is only one of many debts the Government must pay. Most media outlet have explained all that. If the fed can't borrow any money to pay it's debts somebody is not going to get paid.
Expenditures would have to be cut. I say the President should close up half the military bases we have scattered about the world. End the War on recreational drug users. Blanket amnesty for all non-criminal illegal aliens.
Fitch Ratings is now sounding the alarm. It said last week it may downgrade the U.S. if the government doesn't raise the federal debt ceiling in a "timely manner," and it warned that a prolonged government shutdown would "damage perceptions of U.S. sovereign creditworthiness" and "signal that the U.S. government was in financial distress." Fitch is the only major ratings firm with a negative outlook on the U.S. rating. It gives U.S. debt its highest rating, triple-A, as does the other of the three leading ratings firms, Moody's Investors Service.
Uneasy Investors Sell Billions in Treasurys - WSJ.com
This should probably be a separate thread.
But if the gov't does actually default, what will that mean for us? I read this AM that some lenders are not taking short dated Treasuries as collateral. If Treasuries suffer a huge loss in value, many loans are collaterized with them. Banks have Tier 1 capital in Treasuries. If they lose that capital there will be enormous runs on those banks, with no FDIC to backstop it.
We will be back to a barter economy in no time.
Investors holding $120 billion of Treasury bills coming due tomorrow are increasingly worried that they wont get paid.
Rates on the bills, maturing the same day Treasury Secretary Jacob J. Lew has said the U.S. will exhaust its borrowing capacity, surged 12 basis points, or 0.12 percentage point, to 0.32 percent yesterday, according to Bloomberg Bond Trader prices. The securities, issued a year earlier, traded at a rate of negative 0.01 percent as recently as Sept. 26. ...
The next securities maturing after the Oct. 17 debt are $93 billion of bills due Oct. 24. Rates on those bills rose 20 basis points to 0.46 percent after touching 0.51 percent, the highest since the securities were sold in April. The rate was negative as recently as Sept. 27.
The Treasury is scheduled to auction $68 billion in securities today, including $22 billion in 52-week bills, $26 billion of four-week bills and $26 billion in 189-day cash management bills. ...
The bill auctions were very poor, said Thomas Simons, a government-debt economist in New York at primary dealer Jefferies LLC. Unless there is some type of agreement in Washington, the bill market will continue to trade choppily and auctions will not go well. ...
The Bipartisan Policy Center, a Washington-based nonprofit research group, estimates that the Treasury will actually be unable to pay all the governments bills on time at some point between Oct. 22 and Nov. 1. While the Treasury will probably be able to delay the true drop-dead date for a few days, it is unlikely to be able to do so beyond Nov. 1 because several large payments are due before then, the center says.
This should probably be a separate thread.
But if the gov't does actually default, what will that mean for us? I read this AM that some lenders are not taking short dated Treasuries as collateral. If Treasuries suffer a huge loss in value, many loans are collaterized with them. Banks have Tier 1 capital in Treasuries. If they lose that capital there will be enormous runs on those banks, with no FDIC to backstop it.
We will be back to a barter economy in no time.
That's an interesting question.
I was reading a piece by a very well known, large hedge fund with a good economics department who believes that a default probably doesn't have as big of an effect as everyone believes BUT qualifies it as saying they really don't know enough.
I worry about the collateral chain. Treasuries are the primary security used for repurchase agreements, or repos, which are used to finance a wide swath of assets on banks' balance sheets. What happens if they are no longer accepted or, more likely since that is almost inconceivable, the haircuts needed for funds to accept the securities for repo collateral?
I honestly have no idea. But I can see how it could turn bad.
I wonder if the Press is going to hit Obama and the Democrats with this?
In a memo being circulated on Capitol Hill Wednesday, Moodys Investors Service offers answers to frequently asked questions about the government shutdown, now in its second week, and the federal debt limit. President Obama has said that, unless Congress acts to raise the $16.7 trillion limit by next Thursday, the nation will be at risk of default.
Not so, Moodys says in the memo dated Oct. 7.
We believe the government would continue to pay interest and principal on its debt even in the event that the debt limit is not raised, leaving its creditworthiness intact, the memo says. The debt limit restricts government expenditures to the amount of its incoming revenues; it does not prohibit the government from servicing its debt. There is no direct connection between the debt limit (actually the exhaustion of the Treasurys extraordinary measures to raise funds) and a default.
I doubt it... But if it were an honest press they would.
Paying interest on the Treasury Notes is only one of many debts the Government must pay. Most media outlet have explained all that. If the fed can't borrow any money to pay it's debts somebody is not going to get paid.
Expenditures would have to be cut. I say the President should close up half the military bases we have scattered about the world. End the War on recreational drug users. Blanket amnesty for all non-criminal illegal aliens.
Wow! Just wow. I wonder if First State Bank will loan me the money to pay my loan from First National Bank that pays my loan to First International Bank? Do you see the problem here? Borrowing money to pay your debts? Why don't liberals understand fiscal issues? Taking the Paul Krugman, MSM and Democrat route of saying that government finances are different than business or personal finances is like saying that gravity doesn't apply to rocks, but it does to trees and water.
Pseudo-conservatives racked up the debt and played a major part in the Bush Recession. But feel free to blame the liberals for lack of understanding fiscal issues.
http://www.nytimes.com/2011/07/24/opinion/sunday/24sun4.html?_r=0
With President Obama and Republican leaders calling for cutting the budget by trillions over the next 10 years, it is worth asking how we got here from healthy surpluses at the end of the Clinton era, and the promise of future surpluses, to nine straight years of deficits, including the $1.3 trillion shortfall in 2010. The answer is largely the Bush-era tax cuts, war spending in Iraq and Afghanistan, and recessions.
Despite what antigovernment conservatives say, non-defense discretionary spending on areas like foreign aid, education and food safety was not a driving factor in creating the deficits. In fact, such spending, accounting for only 15 percent of the budget, has been basically flat as a share of the economy for decades. Cutting it simply will not fill the deficit hole.
Bush wasn't President in 2010, Obama was! That little incident on 911 changed the country forever. War is not cheap and the defense against future attacks was met by Bush at an incredible cost.
In case you missed it, those budgets during the Clinton years were agreed to after the fiscal conservatives in the House dragged him kicking and screaming to the table. It even took a (gasp) government shutdown to do it. Clinton is a bottom feeding scumbag, but he did what he had to do to stay in office.
Fitch Ratings is now sounding the alarm. It said last week it may downgrade the U.S. if the government doesn't raise the federal debt ceiling in a "timely manner," and it warned that a prolonged government shutdown would "damage perceptions of U.S. sovereign creditworthiness" and "signal that the U.S. government was in financial distress." Fitch is the only major ratings firm with a negative outlook on the U.S. rating. It gives U.S. debt its highest rating, triple-A, as does the other of the three leading ratings firms, Moody's Investors Service.
Uneasy Investors Sell Billions in Treasurys - WSJ.com
This should probably be a separate thread.
But if the gov't does actually default, what will that mean for us? I read this AM that some lenders are not taking short dated Treasuries as collateral. If Treasuries suffer a huge loss in value, many loans are collaterized with them. Banks have Tier 1 capital in Treasuries. If they lose that capital there will be enormous runs on those banks, with no FDIC to backstop it.
We will be back to a barter economy in no time.
