Would you raise the interest rate on your own mortgage or credit card?

[Quantum Windbag]

What do you think your talking about? There are no "goal posts". You can't say anything specific about the debt, deficit and the economy. There is no "goal post" to move.

Just to be clear, I read the posts again. I said, in no uncertain terms, exactly what you wanted to be certain I was saying. Not only are their no goal posts to be moved, I broadened my statement by removing any goal posts for you.

You are entirely out of touch with reality. I said, in no uncertain terms that in the 200+ years, there has never been a problem. Surely you can kick tue football through that football field wide "goal posts".

I have said specific things, and you keep talking about magic.

Not in any post I have replied to. Often I am on an i-pod, I read what I can. If I missed these specifics, I apologize, so pull them forward or something because the posts I have managed to read don't have anything specific in terms of the mechanism that is this terrible problem. If I missed em, then you just got damned unlucky or you post a lot of non-details too.

So you know, I generally start from the end of the tread and work backward. Sometimes I page back a few pages and start. It depends on my mood. It isn't my fault if you post vague stuff after you post some relevant detailed explanation. It's a forum. You have control and responsibility for your posts, your participation. And obviously, there is no guarantee that everyone is going to read everything you post.

Well, what else would you expect from one of Obama's flying monkeys?

But I will tell you this, saying "one of Obama's flying monkey" just demonstrates that you are an ignorant asshole. I don't know Obama. I don't work for a government agency. I didn't go to Harvard.

But I do have an education, I am intelligent (probably more so than you), and I have deduced my own understanding about how economics and the markets work.

That you have nothing really intelligent to say is a reflection on you. And I can't respond with much to meaningless and moronic posts like yours. If you wan't an intelligent response, say something intelligent. I am begging you for one fucking intelligent comment.

What makes you so special that I have to reply to your stupidity when I already answered every question you have?

 

[Quantum Windbag]

They do specifically say, "The statutory debt ceiling and the threat of default have become political bargaining chips in the debate over fiscal policy."

That is debt ceiling.

Umm, no it isn't.

So your just being a dick, huh... cuz you posted

The political brinksmanship of recent months highlights what we see as America's governance and policymaking becoming less stable, less effective, and less predictable than what we previously believed. The tatutory debt ceiling and the threat of default have become political bargaining chips in the debate over fiscal policy. Despite this year's wide-ranging debate, in our view, the differences between political parties have proven to be extraordinarily difficult to bridge, and, as we see it, the resulting agreement fell well short of the comprehensive fiscal consolidation program that some proponents had envisaged until quite recently. Republicans and Democrats have only been able to agree to relatively modest savings on discretionary spending while delegating to the Select Committee decisions on more comprehensive measures. It appears that for now, new revenues have dropped down on the menu of policy options. In addition, the plan envisions only minor policy changes on Medicare and little change in other entitlements, the containment of which we and most other independent observers regard as key to long-term fiscal sustainability.

The outlook on the long-term rating is negative. We could lower the long-term rating to 'AA' within the next two years if we see that less reduction in spending than agreed to, higher interest rates, or new fiscal pressures during the period result in a higher general government debt trajectory than we currently assume in our base case.

Yeah, you are either insane or a dick.

Does reposting things I already posted make you feel smart?

 

[Quantum Windbag]

Of course the current debt is sustainable. What is questionable is whether the future debt is sustainable. If nominal GDP grows faster than future debt, then it is sustainable. If future debt grows faster than nominal GDP, then its questionable whether its sustainable.

We should assume that GDP is going to do wonderful things just so that we can offload the problem to someone else? How did that work out for Greece?

Greece isn't an independent economic country. It is part of the EU. It doesn't mean shit. That would be like asking about California.

Try getting real and use analogies that have a point to point relevance. Frankly, there are no analogies for the US Economy. It is rather unique. So how about we stick with reality. What, some problem with actually discussing the real thing?

Is the future debt sustainable? Yes, until it just fucking annoys people. It isn't a problem until the interest equals the revenues. And even then, if increased slowly, it isn't a problem. It is a problem way down the road.

I would love to have a discussion of what level the taxes and interest on the debt becomes a real, not illusionary problem. I haven't bothered to calculate it.

Last I looked, the deficit is shrinking, that is a good start. The rate of change is the problem, not the level. So, it isn't really a problem except way off.

And the point of the OP was that the debt ceiling crisis is just stupid. Try and stick within the parameters of the OP. Creating a crisis over the debt ceiling is stupid as the debt isn't a crisis.

The GDP better do wonderful things. That is the whole point. The focus absolutely must be on employment and production, consumption and efficiency. Making some big, nonsense deal over an imaginary problem that might happen at some unspecified level of debt and deficit while ignoring what an economy actually is..... well.....do you need me to say it?

There is no such thing as an economically independent country anymore, what's your point?

Wait, I forgot, you don't have one.

 

[Quantum Windbag]

If it was about the debt ceiling and political dysfunction why wasn't it dropped any of the previous 16 times the debt ceiling was used to force a government shutdown over policy issues?

Because S&P said it was about the debt ceiling. The inability to raise the debt ceiling is reflective of the political dysfunction in Washington.

It's not about shutting down the government. It's about making payments on time.

They specifically said it was about the inability to deal with the debt. Believe it or not, the debt and the debt ceiling are not the same, even if is impossible to discuss government policy about one without discussing the other.

 

[Quantum Windbag]

We should assume that GDP is going to do wonderful things just so that we can offload the problem to someone else? How did that work out for Greece?

It didn't work for Greece because the analogy isn't relevant. Greece's debt rose faster than economic growth and had a currency that they didn't control.

What matters isn't the level of debt. What matters is the ability to service that debt. If you take out a $100,000 mortgage, and your income rises from $50,000 to $75,000, your financial condition and ability to service the mortgage has improved, even if the absolute level of the mortgage does not change.

Strangely enough, the CBO is saying that, even with their notoriously optimistic projections about the GDP, that we are heading for the same problem Greece had.

By the way, in theory, the US doesn't control its currency either.

 

[Toro]

If it was about the debt ceiling and political dysfunction why wasn't it dropped any of the previous 16 times the debt ceiling was used to force a government shutdown over policy issues?

Because S&P said it was about the debt ceiling. The inability to raise the debt ceiling is reflective of the political dysfunction in Washington.

It's not about shutting down the government. It's about making payments on time.

They specifically said it was about the inability to deal with the debt. Believe it or not, the debt and the debt ceiling are not the same, even if is impossible to discuss government policy about one without discussing the other.

And the dysfunction around the debt ceiling is symptomatic of dealing with the debt. I'm in the business. I remember it very well.

Ask a bond trader. [MENTION=41066]Kimura[/MENTION].

 

[Toro]

We should assume that GDP is going to do wonderful things just so that we can offload the problem to someone else? How did that work out for Greece?

It didn't work for Greece because the analogy isn't relevant. Greece's debt rose faster than economic growth and had a currency that they didn't control.

What matters isn't the level of debt. What matters is the ability to service that debt. If you take out a $100,000 mortgage, and your income rises from $50,000 to $75,000, your financial condition and ability to service the mortgage has improved, even if the absolute level of the mortgage does not change.

Strangely enough, the CBO is saying that, even with their notoriously optimistic projections about the GDP, that we are heading for the same problem Greece had.

By the way, in theory, the US doesn't control its currency either.

It's not the same problem as Greece. Greece borrowed in currency it did not control. The US borrows its own currency. It can inflate away its debt. That might be a bad - maybe very bad - idea, but they aren't the same. The only reason why the US would ever default on its debt is if Americans decided not to pay it back, not because we can't pay it back.

FTR It's not a good idea for the government to keep piling on debt at a rate above the nominal rate of economic growth. At some point, there will be adverse effects, perhaps even chaos in financial markets and a dollar crisis. But if we don't raise the debt ceiling, we risk financial chaos and re-entering a recession.

 

[Quantum Windbag]

Because S&P said it was about the debt ceiling. The inability to raise the debt ceiling is reflective of the political dysfunction in Washington.

It's not about shutting down the government. It's about making payments on time.

They specifically said it was about the inability to deal with the debt. Believe it or not, the debt and the debt ceiling are not the same, even if is impossible to discuss government policy about one without discussing the other.

And the dysfunction around the debt ceiling is symptomatic of dealing with the debt. I'm in the business. I remember it very well.

Ask a bond trader. @Kimura.

Harry Reid will not accept any type of deal on the debt ceiling, including continuing the fake cuts in the sequester. But, somehow, you are saying that the problem is the debt ceiling itself.

 

[Quantum Windbag]

It didn't work for Greece because the analogy isn't relevant. Greece's debt rose faster than economic growth and had a currency that they didn't control.

What matters isn't the level of debt. What matters is the ability to service that debt. If you take out a $100,000 mortgage, and your income rises from $50,000 to $75,000, your financial condition and ability to service the mortgage has improved, even if the absolute level of the mortgage does not change.

Strangely enough, the CBO is saying that, even with their notoriously optimistic projections about the GDP, that we are heading for the same problem Greece had.

By the way, in theory, the US doesn't control its currency either.

It's not the same problem as Greece. Greece borrowed in currency it did not control. The US borrows its own currency. It can inflate away its debt. That might be a bad - maybe very bad - idea, but they aren't the same. The only reason why the US would ever default on its debt is if Americans decided not to pay it back, not because we can't pay it back.

FTR It's not a good idea for the government to keep piling on debt at a rate above the nominal rate of economic growth. At some point, there will be adverse effects, perhaps even chaos in financial markets and a dollar crisis. But if we don't raise the debt ceiling, we risk financial chaos and re-entering a recession.

How the fuck do we risk disaster by not automatically spending more money? I might have a serious problem with rewriting history, but the last time we really wnet through a major crisis over the debt ceiling during the Clinton administration the markets kept right on going, and the result was an economy that thrived. The reason for that is, despite the rhetoric, the debt ceiling is going to get raised. Everyone, including you, knows that. The only question is what conditions are going to be placed on it, if any, and who will win the sort term fight. It will not cause a financial disaster of the government has to pretend it is shut down for a few days.

 

[Soggy in NOLA]

Why would you continue to spend yourself into oblivion, all on your credit cards?

Sounds pretty irresponsible and frankly, pretty stupid.

 

[Toro]

Strangely enough, the CBO is saying that, even with their notoriously optimistic projections about the GDP, that we are heading for the same problem Greece had.

By the way, in theory, the US doesn't control its currency either.

It's not the same problem as Greece. Greece borrowed in currency it did not control. The US borrows its own currency. It can inflate away its debt. That might be a bad - maybe very bad - idea, but they aren't the same. The only reason why the US would ever default on its debt is if Americans decided not to pay it back, not because we can't pay it back.

FTR It's not a good idea for the government to keep piling on debt at a rate above the nominal rate of economic growth. At some point, there will be adverse effects, perhaps even chaos in financial markets and a dollar crisis. But if we don't raise the debt ceiling, we risk financial chaos and re-entering a recession.

How the fuck do we risk disaster by not automatically spending more money? I might have a serious problem with rewriting history, but the last time we really wnet through a major crisis over the debt ceiling during the Clinton administration the markets kept right on going, and the result was an economy that thrived. The reason for that is, despite the rhetoric, the debt ceiling is going to get raised. Everyone, including you, knows that. The only question is what conditions are going to be placed on it, if any, and who will win the sort term fight. It will not cause a financial disaster of the government has to pretend it is shut down for a few days.

It's not shutting the government per se, it's the debt ceiling. If markets think the US Treasury will not make payments on its debt, it could precipitate a spike in interest rates and a dollar panic leading to recession, the types of things conservatives say they want to avoid by limiting the amount of debt we incur.

 

[Quantum Windbag]

It's not the same problem as Greece. Greece borrowed in currency it did not control. The US borrows its own currency. It can inflate away its debt. That might be a bad - maybe very bad - idea, but they aren't the same. The only reason why the US would ever default on its debt is if Americans decided not to pay it back, not because we can't pay it back.

FTR It's not a good idea for the government to keep piling on debt at a rate above the nominal rate of economic growth. At some point, there will be adverse effects, perhaps even chaos in financial markets and a dollar crisis. But if we don't raise the debt ceiling, we risk financial chaos and re-entering a recession.

How the fuck do we risk disaster by not automatically spending more money? I might have a serious problem with rewriting history, but the last time we really wnet through a major crisis over the debt ceiling during the Clinton administration the markets kept right on going, and the result was an economy that thrived. The reason for that is, despite the rhetoric, the debt ceiling is going to get raised. Everyone, including you, knows that. The only question is what conditions are going to be placed on it, if any, and who will win the sort term fight. It will not cause a financial disaster of the government has to pretend it is shut down for a few days.

It's not shutting the government per se, it's the debt ceiling. If markets think the US Treasury will not make payments on its debt, it could precipitate a spike in interest rates and a dollar panic leading to recession, the types of things conservatives say they want to avoid by limiting the amount of debt we incur.

The market knows better, even if you don't. The debt ceiling has nothing to do with making payments on the debt, it is about borrowing money to continue new spending.

 

[Toro]

How the fuck do we risk disaster by not automatically spending more money? I might have a serious problem with rewriting history, but the last time we really wnet through a major crisis over the debt ceiling during the Clinton administration the markets kept right on going, and the result was an economy that thrived. The reason for that is, despite the rhetoric, the debt ceiling is going to get raised. Everyone, including you, knows that. The only question is what conditions are going to be placed on it, if any, and who will win the sort term fight. It will not cause a financial disaster of the government has to pretend it is shut down for a few days.

It's not shutting the government per se, it's the debt ceiling. If markets think the US Treasury will not make payments on its debt, it could precipitate a spike in interest rates and a dollar panic leading to recession, the types of things conservatives say they want to avoid by limiting the amount of debt we incur.

The market knows better, even if you don't. The debt ceiling has nothing to do with making payments on the debt, it is about borrowing money to continue new spending.

Absolutely wrong. I work in markets. The market is selling off because of the debt ceiling. It is the height of ideological delusion to think otherwise.

That's it 150 points.....
Like the market never lost 150 points before...
It's only happened like a billion times.

And we are not even at the point of the debt ceiling issue yet...

In July 2011, the market started to sell off into the debt ceiling debacle. But since most market participants didn't think the US Congress was batshit insane, it was a small decline. Then, when it became apparent that, indeed, the US Congress may be batshit insane, stock markets fell 15% to 20% in less than two weeks.

Since that time, the market has become more comfortable with these showdowns, i.e. The Sequester, believing that even though both sides might play chicken, in the end, they'll get a deal done. Thus, if we shut the government down and don't raise the debt ceiling, the market is likely to have a delayed reaction and decline moderately as investors and traders await a deal to finally happen.

However, if the market thinks a deal really won't happen, raising the specter of a default, we would likely experience a similar sharp decline like we did in 2011, or perhaps more, a few days to a few weeks after we hit the debt ceiling. Why? Because US Treasury securities are the lynchpin of the global financial system. They are viewed as the safest investments in the world, and are used as collateral in repurchase agreements used to finance inventories of leveraged securities at banks. If the value of the collateral declines sharply suddenly, collateral values will fall, which would likely lead to forced and vicious selling, creating a spiral which induces more selling that likely wouldn't stop until intervention from the Fed.

 

[Quantum Windbag]

It's not shutting the government per se, it's the debt ceiling. If markets think the US Treasury will not make payments on its debt, it could precipitate a spike in interest rates and a dollar panic leading to recession, the types of things conservatives say they want to avoid by limiting the amount of debt we incur.

The market knows better, even if you don't. The debt ceiling has nothing to do with making payments on the debt, it is about borrowing money to continue new spending.

Absolutely wrong. I work in markets. The market is selling off because of the debt ceiling. It is the height of ideological delusion to think otherwise.

That's it 150 points.....
Like the market never lost 150 points before...
It's only happened like a billion times.

And we are not even at the point of the debt ceiling issue yet...

In July 2011, the market started to sell off into the debt ceiling debacle. But since most market participants didn't think the US Congress was batshit insane, it was a small decline. Then, when it became apparent that, indeed, the US Congress may be batshit insane, stock markets fell 15% to 20% in less than two weeks.

Since that time, the market has become more comfortable with these showdowns, i.e. The Sequester, believing that even though both sides might play chicken, in the end, they'll get a deal done. Thus, if we shut the government down and don't raise the debt ceiling, the market is likely to have a delayed reaction and decline moderately as investors and traders await a deal to finally happen.

However, if the market thinks a deal really won't happen, raising the specter of a default, we would likely experience a similar sharp decline like we did in 2011, or perhaps more, a few days to a few weeks after we hit the debt ceiling. Why? Because US Treasury securities are the lynchpin of the global financial system. They are viewed as the safest investments in the world, and are used as collateral in repurchase agreements used to finance inventories of leveraged securities at banks. If the value of the collateral declines sharply suddenly, collateral values will fall, which would likely lead to forced and vicious selling, creating a spiral which induces more selling that likely wouldn't stop until intervention from the Fed.

Every pundit on the planet thinks he knows why the market knows what it does, 100% of them are wrong at least 50% of the time.

According to the CBO the government can continue to spend gobs of money until at least the 15th of October. That gives us a two week grace period even if the government shuts down before there will be any type of crisis. If a few rich people, and some pension plans, lose a little paper value in the meantime the world will not end. Frankly, I am a little tired of the fact that the fed has been propping up rich people the last few years, and see it is as a good thing.

Even after we "run out of money" in October we will still be getting revenue and will still be able to meet the interest payments on the debt, which will assure that we do not default. Since that is not going to happen, I fail to see any reason to act like the impossible is inevitable.

 

[itfitzme]

Umm, no it isn't.

So your just being a dick, huh... cuz you posted

The political brinksmanship of recent months highlights what we see as America's governance and policymaking becoming less stable, less effective, and less predictable than what we previously believed. The tatutory debt ceiling and the threat of default have become political bargaining chips in the debate over fiscal policy. Despite this year's wide-ranging debate, in our view, the differences between political parties have proven to be extraordinarily difficult to bridge, and, as we see it, the resulting agreement fell well short of the comprehensive fiscal consolidation program that some proponents had envisaged until quite recently. Republicans and Democrats have only been able to agree to relatively modest savings on discretionary spending while delegating to the Select Committee decisions on more comprehensive measures. It appears that for now, new revenues have dropped down on the menu of policy options. In addition, the plan envisions only minor policy changes on Medicare and little change in other entitlements, the containment of which we and most other independent observers regard as key to long-term fiscal sustainability.

The outlook on the long-term rating is negative. We could lower the long-term rating to 'AA' within the next two years if we see that less reduction in spending than agreed to, higher interest rates, or new fiscal pressures during the period result in a higher general government debt trajectory than we currently assume in our base case.

Yeah, you are either insane or a dick.

Does reposting things I already posted make you feel smart?

The idea was to allow you to read what you post, as you seem to forget so easily.

 

[itfitzme]

two days ago

" Investors stayed calm on the first day of a partial shutdown of the U.S. government Tuesday and sent the stock market modestly higher."

One day ago

"American investors responded with a shrug to the first government shutdown in seventeen years, after many investors had watched for the last"

3 hours


"The stock market is getting a little bumpy as the government shutdown wears on, but if Congress pushes a deadline on the federal debt limit in ."

 

[Quantum Windbag]

So your just being a dick, huh... cuz you posted


Yeah, you are either insane or a dick.

Does reposting things I already posted make you feel smart?

The idea was to allow you to read what you post, as you seem to forget so easily.

The only way you can feel smart is reposting things other people already posted, that is so sad.

 

[itfitzme]

Does reposting things I already posted make you feel smart?

The idea was to allow you to read what you post, as you seem to forget so easily.

The only way you can feel smart is reposting things other people already posted, that is so sad.

right.