US will hit debt limit in mid-Oct

[Toro]

The debt ceiling is going up, after the kabuki theater.

I can't believe the Republicans will be that stupid to not raise it.

 

[NightFox]

Try the raw treasury numbers on for size --> U.S. National Debt Clock : Real Time

Thos aren't raw Treasury numbers. Actually, that's not even a government website. It's just a site sombody set up with a bunch of free-running counters, whose speed he adjusts every now and then, to roughly keep up with the debt etc.

The numbers on that site are sourced and if you look at the latest CBO report on the deficit projections and do some quick math based off their raw numbers you'll find that what the debt clock shows for those two numbers is remarkably in synch with the raw numbers the CBO reports. Doesn't mean that they ARE accurate because as you have pointed out the federal government pretty much distorts everything but you can use it as a thumbnail guide.

The graph I made IS from Treasury numbers, as the URL indicates... but as I mentioned, they are full of lies.

The cap on the National Debt, means that they cannot borrow money above that limit... and we hit the limit last Spring.

Since they consider that THEY own all those retirement funds, they can take the money out without calling it "borrowing"... even though the plan is to pay them back.

How that is not "borrowing", they haven't explained.

But I just explained it: They are lying about what they are doing.

And as I mentioned, if any financial person in any company in America did this, even a little bit, they would be thrown into prison for fraud.

As they deserved.

Unless they are in government. Those, we re-elect.

Looks like we're in complete agreement on the major points here.

 

[Moonglow]

Some Common Misconceptions

The national debt is a burden on future generations.

This is based on the false premise that the national debt must be paid off by the private sector some day. In reality, the government itself pays to redeem its debt securities as they mature, using funds obtained by selling new securities to the public. This "rolling over" of the national debt can be continued indefinitely, since the government can pay whatever interest rate the market demands for its securities.

Interest paid on the debt reduces the funds available for other government spending.

There is no basic constraint on government spending in its own currency. Interest payments and the revenues that support them are part of the balanced reciprocal flow of funds between the Treasury and the private sector. Their only effect is a redistribution of financial assets, which of course is true of all government spending.

Government borrowing drains loanable funds needed within the private sector.

The government does not borrow to accumulate funds in the Treasury. It borrows only to cover its deficit spending, and thus does not affect the size of the private sector money supply on average. While government borrowing could temporarily reduce the supply of loanable funds within the private sector, that effect is short-lived and typically negligible.

 

[NightFox]

The debt ceiling is going up, after the kabuki theater.

I can't believe the Republicans will be that stupid to not raise it.

Why is it "stupid" not to raise it? Is it rational to hasten our journey toward national financial ruin or does it make more sense to take our medicine NOW and begin attempting to get our financial house in order before it's too late?

What's your end game here, continuous accumulation of public debt ? Do you really think that can go on forever?

"If something cannot go on forever, it will stop." -- Herb Stein, Steins Law

 

[Moonglow]

"Our nation's wealth is being drained drop by drop because our government continues to mount record deficits. The security of our country depends on the fiscal integrity of our government, and we're throwing it away." Senator Warren Rudman.

Warnings like this are commonplace today. The assumption is that the Federal government has limited financial resources and at some point will be unable to service its growing debt, in short that it will become bankrupt. Responsible fiscal policy is viewed as requiring a balanced budget. Individuals and firms can indeed borrow their way into bankruptcy. There is no such danger for the government when it borrows in the same currency that it creates. In a fiat money system the government has just as much money at its disposal under a budget deficit as with a budget surplus.

When we adopted a monetary base of intrinsically worthless paper money in the mid-20th century, we created a new paradigm that is still widely misunderstood. The imperatives are quite different from those of the earlier gold-based system. The key to maintaining the purchasing power of money is to control the price of credit. That means controlling the cost to banks of acquiring the reserves they need to cover their depositors' transactions. The Fed has the primary responsibility, but the Treasury plays an indispensable role.

Understanding Government Debt

 

[OohPooPahDoo]

Treasury says US will hit debt limit in mid-Oct | Financial Headlines | Comcast

Treasury Secretary Jacob Lew has told Congress that the government will run out of money to pay its bills in mid-October unless lawmakers raise the country's borrowing limit, which is capped at $16.7 trillion.

Lew said in a letter to Speaker John Boehner released Monday that the government is running out of accounting maneuvers it has used to avoid hitting the borrowing limit. He pressed Congress to act so Treasury can keep paying the government's bills.

Lew said it's impossible for Treasury to predict exactly when borrowing limit will be reached. But he warns that if action isn't taken soon, the government could be left with $50 billion in cash by mid-October. He says that wouldn't be enough to cover Social Security payments, military personnel salaries, Medicare and other programs for an "extended period."

The government is spending more than it takes in, running up annual deficits in excess of $1 trillion in each of the past four budget years. It has been borrowing the difference to meet its obligations.

That good old Obama just keeps on breaking records , record debt , but no problem pissing away a few hundred million on vacations......

View attachment 27349 View attachment 27350 View attachment 27351

Fuck it.

The President can override this bullcrap with a single executive order to the Treasury - an order to borrow what ever is needed to continue the spending that Congress has already authorized.

If Congress passes one law that says "you must spend this money" and another that says "you may not spend this money" - they have passed contradictory laws. Its not possible to follow one without breaking the other. When that is the case its up to the President to decide which to break and which to follow until Congress resolves the conflicting legislation.

 

[Toro]

The debt ceiling is going up, after the kabuki theater.

I can't believe the Republicans will be that stupid to not raise it.

Why is it "stupid" not to raise it? Is it rational to hasten our journey toward national financial ruin or does it make more sense to take our medicine NOW and begin attempting to get our financial house in order before it's too late?

What's your end game here, continuous accumulation of public debt ? Do you really think that can go on forever?

"If something cannot go on forever, it will stop." -- Herb Stein, Steins Law

Actually, yes, the debt ceiling can be risen forever if nominal GDP rises as fast or faster than debt accumulation.

But this debt ceiling BS is fundamentally dishonest. If Republicans were really worried about the debt, they wouldn't fight every single tax increase like it's the last battle in the world.

And FTR, the Democrats are just as bad. Every Democrat Senator voted against raising the debt ceiling in 2006 (or 2007, I can't remember), including Obama.

 

[Little-Acorn]

By the way, one of the biggest expenses in the entire Federal budget, is Interest on the National Debt. It's been around $450 billion a year, for years now.

Federal Budget--Receipts, Outlays, and Debt - The 2012 Statistical Abstract - U.S. Census Bureau

That's around $1,400 per year for every man, woman, and child in America.

Or more than $5,000 per year for every family of four.

And that amount DOES come from your tax money. Every year.

And the $5,000/yr buys nothing. Except the privilege of maintaining the huge debt the govt has racked up.

Were you wondering why your household budget doesn't seem to go very far any more?

Now you know.

 

[NightFox]

The debt ceiling is going up, after the kabuki theater.

I can't believe the Republicans will be that stupid to not raise it.

Why is it "stupid" not to raise it? Is it rational to hasten our journey toward national financial ruin or does it make more sense to take our medicine NOW and begin attempting to get our financial house in order before it's too late?

What's your end game here, continuous accumulation of public debt ? Do you really think that can go on forever?

"If something cannot go on forever, it will stop." -- Herb Stein, Steins Law

Actually, yes, the debt ceiling can be risen forever if nominal GDP rises as fast or faster than debt accumulation.

Even if that were true (which it isn't) the debt has been accumulating faster than growth in economic output for over a decade and it will only accelerate when interest rates begin rising toward real market rates (not to mention the necessity to account for massive future liabilities), that's why our debt to GDP ratio has been steadily rising. We are heading for an implosion of the currency and the more debt we take on the faster it will arrive. It's absolutely immoral and stupid to continue on with this nonsense.

But this debt ceiling BS is fundamentally dishonest. If Republicans were really worried about the debt, they wouldn't fight every single tax increase like it's the last battle in the world.

And FTR, the Democrats are just as bad. Every Democrat Senator voted against raising the debt ceiling in 2006 (or 2007, I can't remember), including Obama.

The whole federal behemoth is fundamentally dishonest, they think they continue to increase debt ad infinitum instead of having to make tough choices and set spending priorities, this is historically a sure fire means of destroying great nations.

 

[The Rabbi]

Treasury says US will hit debt limit in mid-Oct | Financial Headlines | Comcast

Treasury Secretary Jacob Lew has told Congress that the government will run out of money to pay its bills in mid-October unless lawmakers raise the country's borrowing limit, which is capped at $16.7 trillion.

Lew said in a letter to Speaker John Boehner released Monday that the government is running out of accounting maneuvers it has used to avoid hitting the borrowing limit. He pressed Congress to act so Treasury can keep paying the government's bills.

Lew said it's impossible for Treasury to predict exactly when borrowing limit will be reached. But he warns that if action isn't taken soon, the government could be left with $50 billion in cash by mid-October. He says that wouldn't be enough to cover Social Security payments, military personnel salaries, Medicare and other programs for an "extended period."

The government is spending more than it takes in, running up annual deficits in excess of $1 trillion in each of the past four budget years. It has been borrowing the difference to meet its obligations.

That good old Obama just keeps on breaking records , record debt , but no problem pissing away a few hundred million on vacations......

View attachment 27349 View attachment 27350 View attachment 27351

Fuck it.

The President can override this bullcrap with a single executive order to the Treasury - an order to borrow what ever is needed to continue the spending that Congress has already authorized.

If Congress passes one law that says "you must spend this money" and another that says "you may not spend this money" - they have passed contradictory laws. Its not possible to follow one without breaking the other. When that is the case its up to the President to decide which to break and which to follow until Congress resolves the conflicting legislation.

The president does not have authority to borrow funds, which is given to Congress by the Constitution.
Now of course that doesnt mean Obama won't do it. He's never let the Constitution get in the way of what he wanted.
Boy, if Bush had done half this crap the leftists would be stroking out screaming he was gutting the Constitution and the American dream.

 

[Little-Acorn]

Can you imagine what would happen if the media started reporting the truth here?

1.) That the government has already spent all the money in the Social Security Trust fund, and is now draining all the other Federal trust funds for retirements etc., while not cutting spending even a nickel?

2.) And that these activities would cause the perps to be jailed for fraud and embezzlement if they were being done anywhere in the country, other than the Fed govt? (Does "high crimes and misdemeanors" ring a bell? "High crimes" refers to ordinary crimes committed by persons in high office)

3.) And that the Fed will have to borrow nearly $2 trillion, virtually instantly, once Congress raises the debt ceiling, just to pay back what they've taken? Plus more to continue their free-spending ways?

Yeah, I know, such reporting will never happen. But just think of the uproar....

 

[OohPooPahDoo]

Why is it "stupid" not to raise it? Is it rational to hasten our journey toward national financial ruin or does it make more sense to take our medicine NOW and begin attempting to get our financial house in order before it's too late?

What's your end game here, continuous accumulation of public debt ? Do you really think that can go on forever?

"If something cannot go on forever, it will stop." -- Herb Stein, Steins Law

Actually, yes, the debt ceiling can be risen forever if nominal GDP rises as fast or faster than debt accumulation.

Even if that were true (which it isn't) the debt has been accumulating faster than growth in economic output for over a decade and it will only accelerate when interest rates begin rising toward real market rates (not to mention the necessity to account for massive future liabilities), that's why our debt to GDP ratio has been steadily rising. We are heading for an implosion of the currency and the more debt we take on the faster it will arrive. It's absolutely immoral and stupid to continue on with this nonsense.

"real market rates" ? LOL. What rates are they at now?

Higher interest is usually correlated with higher inflation. That will take off some of the pressure. The treasury is also presently trying to increase the average maturity of debt outstanding, locking in long term rates.

 

[NightFox]

Can you imagine what would happen if the media started reporting the truth here?

1.) That the government has already spent all the money in the Social Security Trust fund, and is now draining all the other Federal trust funds for retirements etc., while not cutting spending even a nickel?

2.) And that these activities would cause the perps to be jailed for fraud and embezzlement if they were being done anywhere in the country, other than the Fed govt? (Does "high crimes and misdemeanors" ring a bell? "High crimes" refers to ordinary crimes committed by persons in high office)

3.) And that the Fed will have to borrow nearly $2 trillion, virtually instantly, once Congress raises the debt ceiling, just to pay back what they've taken? Plus more to continue their free-spending ways?

Yeah, I know, such reporting will never happen. But just think of the uproar....

The bulk of the American People have made it clear that they don't care, they want their bread and circuses NOW and will use any rationalization no matter how disingenuous and flimsy to support the continuation down the path of national financial ruin.

The only comfort from all this is that the head in the sand, statist parrots are going to get EXACTLY what is coming to them and they're not going to like it.

"As I have seen, those who plow iniquity and sow trouble reap the same" -- Job 4:8

 

[ScienceRocks]

Give the American people what they want(bread and circuses).

 

[NightFox]

Give the American people what they want(bread and circuses).

Tell that to the future generations of Americans that will have to foot the bill for 'em.

 

[oldfart]

By the way, one of the biggest expenses in the entire Federal budget, is Interest on the National Debt. It's been around $450 billion a year, for years now.

And it never occurred to you to question why with the debt going up trillions of dollars, the interest stays the same?

 

[Jos]

Give the American people what they want(bread and circuses).

Tell that to the future generations of Americans that will have to foot the bill for 'em.

Future generations will ask how come they came to be debt slaves in the Land they were born into

 

[The Rabbi]

Actually, yes, the debt ceiling can be risen forever if nominal GDP rises as fast or faster than debt accumulation.

Even if that were true (which it isn't) the debt has been accumulating faster than growth in economic output for over a decade and it will only accelerate when interest rates begin rising toward real market rates (not to mention the necessity to account for massive future liabilities), that's why our debt to GDP ratio has been steadily rising. We are heading for an implosion of the currency and the more debt we take on the faster it will arrive. It's absolutely immoral and stupid to continue on with this nonsense.

"real market rates" ? LOL. What rates are they at now?

Higher interest is usually correlated with higher inflation. That will take off some of the pressure. The treasury is also presently trying to increase the average maturity of debt outstanding, locking in long term rates.

They are at artificially low rates because the Fed has been buying bonds to keep prices up and yields down.
But either you knew that and ignored it (lied) or you didnt know it at all (ignorant). So which is it?

 

[OohPooPahDoo]

Even if that were true (which it isn't) the debt has been accumulating faster than growth in economic output for over a decade and it will only accelerate when interest rates begin rising toward real market rates (not to mention the necessity to account for massive future liabilities), that's why our debt to GDP ratio has been steadily rising. We are heading for an implosion of the currency and the more debt we take on the faster it will arrive. It's absolutely immoral and stupid to continue on with this nonsense.

"real market rates" ? LOL. What rates are they at now?

Higher interest is usually correlated with higher inflation. That will take off some of the pressure. The treasury is also presently trying to increase the average maturity of debt outstanding, locking in long term rates.

They are at artificially low rates because the Fed has been buying bonds to keep prices up and yields down.
But either you knew that and ignored it (lied) or you didnt know it at all (ignorant). So which is it?

The Fed is always tinkering with interest rates. When they stop buying and start selling they will be exercising the same power, just the other way. Its not as if one environment is "real" market rates and one isn't - the Fed is always a market participant in treasury obligationsand they will continue to be as long as they have any position on treasuries.

Prior to the Fed, the decentralized system of charter banks exercised the same power of participation in the treasury market, issuing currency and deposits in exchange for the debt obligations of the U.S government (among other things). Today they have a reduced form of that power in that they can still invest deposits in treasuries. In fact - there are many, many participants in the treasury market that buy treasuries that balance their liabilities. Insurance companies partially invest in treasuries, for instance (the biggie being the FDIC), and pension funds invest partially in treasuries. The federal reserve notes and deposits that the Federal Reserve issues are liabilities to the Fed, balanced by the treasuries they receive in exchange - and in this way they are market participants just the same as an insurance company or bank balancing some of its liabilities with treasuries.

 

[The Rabbi]

OK so ignorant and stupid.

The Fed traditionally sets only short term rates. Their intervention in longer term rates through bond buying is unprecedented.