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Old 10-02-2013, 11:54 AM   #1
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October 17th (debt ceiling)

October 17th marks the end of the financial road. If the logjam in Congress cannot be broken by them, Jack Lew stated that there will be no more money at all. The extraordinary measures they have been using [pension cash, etc.] to fund .Gov will be gone and we will officially default. It will be interesting to see who blinks first.
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Old 10-02-2013, 12:13 PM   #2
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Originally Posted by ancona View Post:
October 17th marks the end of the financial road. If the logjam in Congress cannot be broken by them, Jack Lew stated that there will be no more money at all. The extraordinary measures they have been using [pension cash, etc.] to fund .Gov will be gone and we will officially default. It will be interesting to see who blinks first.
I would be suprised if we make it that far.
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Old 10-02-2013, 12:14 PM   #3
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Old 10-02-2013, 12:22 PM   #4
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I dont think the Soc Sec checks for Oct have posted yet. Tho it is only the 2nd.
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Old 10-02-2013, 04:41 PM   #5
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i will bet all my losses on pm's this last 2 years on hot air from the pols and e$ from the Fed

What other choice do they have ?
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Old 10-02-2013, 05:12 PM   #6
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Lew reiterated that if the debt ceiling is not raised by Oct. 17 the government will not be able to meet all its financial commitments, such as making payments to U.S. debt holders, government contractors and Social Security recipients.

Read more: http://www.politico.com/story/2013/1...#ixzz2gbJziNHq
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Old 10-02-2013, 05:36 PM   #7
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they always threaten Social Security, ZH got in on it also:

snip:
CBO concluded that one option to 'balance' the solvency of SS required an "Immediately and Permanent" payroll tax increase of 3.4% (Wow!). A year earlier, CBO stated that a payroll tax increase of 1.9% was required to balance SS. The change in the tax increase required is 70% higher than that reported just a year ago!

snip:
I wonder if the WH will use the rapidly deteriorating condition of SS as its "lever" in negotiating with Republicans over the budget and the debt limit.

http://www.zerohedge.com/contributed...a-i-need-lever
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Old 10-03-2013, 08:34 AM   #8
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David Stockman says, "relax y'all. it's all bullshit.":
Quote :
...
He tells The Daily Ticker the real story is the debt ceiling, and he thinks we’re “finally getting to a defining moment when the truth comes out…if we run out of debt ceiling, the president does have the power to prioritize the inflow of revenue which is still massive coming in.”

And the first thing the government will do, he says, is spend $30 billion paying the interest on the debt (according to Stockman, the government could also pay social security retirees, the armed services, and medicare reimbursements despite broaching the debt limit).

“It is a complete red herring to say there will be a default,” he tells us. “There will never will be a time in which there is not enough cash to pay the interest.”

This is contrary to rhetoric from Treasury Secretary Jack Lew, who has indicated to Congress prioritizing payments is just a default by another name.

Stockman argues tea party Republicans should use the debt ceiling to extract concessions from the White House including defunding Obamacare. The “federal budget is a doomsday machine,” says Stockman. And he insists that $2.5 trillion of spending is already mandatory or automatic entitlements that were never voted for by the people in congress today (implying this spending is unsustainable).
...
http://finance.yahoo.com/blogs/daily...xSWCAAPjmTmYlQ
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Old 10-03-2013, 10:48 AM   #9
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October SS checks posted. As to November- who knows.
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Old 10-07-2013, 11:07 AM   #10
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Quote :
The Wall Street Journal editorial page recently highlighted a largely unknown piece of legislation passed by the House of Representatives in May: the Full Faith and Credit Act, sponsored by Rep. Tom McClintock (R-CA). The bill would prevent the federal government from defaulting by mandating that the Treasury pay the nation's debts even after the debt ceiling is reached. There is enough federal revenue to cover those costs.

That means that some of the government's discretionary spending would not happen, effectively defunding and shutting down some government functions (perhaps in addition to those that are shut down already). But the U.S. government would not default. The Treasury actually has the discretion to structure payments in this way already, but without legislation mandating that it do so, there is no guarantee that it will.

During the 2011 debt ceiling fight, a few Republicans--some from the Tea Party, and even some moderates--suggested that the Treasury's public deadlines for a deal were illusory, because it could continue to service the nation's debt regardless. That is the basis for the spurious charge that the Tea Party, or the GOP itself, wanted default--a baseless claim hurled regularly by President Barack Obama and his Cabinet and party.

This time, the Republican leadership wants to ensure that default is not an option, or even a possibility. That is precisely why Senate Majority Leader Harry Reid (D-NV) has prevented the Senate version of the bill, sponsored by Sen. Pat Toomey (R-PA), from moving forward--and it is also why President Barack Obama has threatened to veto it if it passes. They--not the GOP--want to use threats of default as a bargaining tool.
...
http://www.breitbart.com/Big-Governm...ans-Trump-Card
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Old 10-07-2013, 11:17 AM   #11
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There will still be plenty of money coming into the coffers of the Treasury after Oct 17. They just won't be able to borrow more for a short while. People have the misconception that the country will suddenly be "broke" if Congress doesn't raise the debt ceiling. That's not the case. Treasury (Obama) will just have to prioritize what they pay, and the rest will get IOU's. At the end of the day all those IOU's will be paid. All the furloughed government workers will be paid. This is just a tempest in a tea pot.
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Old 10-07-2013, 11:31 AM   #12
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I don't think they'll let a default happen. Though honesly, I've been using the term financial calamity for the last several years to friends and family when the subject comes up. On the news recently I've heard exactly those words. It makes me feel good that I'm within days of being right, even though it's about something as terrible as a default.
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Old 10-07-2013, 11:46 AM   #13
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I dont think they want it just yet.
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Old 10-09-2013, 09:15 AM   #14
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Read this morning where GOP peeps are gaining confidence in their position that not increasing the debt limit won't bring financial armageddon:

http://www.usatoday.com/story/news/p...enial/2937087/

It occurred to me that there is growing evidence that the appetite for Treasuries among foreign investors has chilled[1, 2, 3]. They are increasingly not buying our debt (selling it actually) and this is not related to the current D.C. theater. The Fed, via QE, is the biggest (only?!?) buyer right now [4] and the market for Treasuries might implode if they made any serious effort to make good on their tapering rhetoric (which is why they can't). Realizing this, one could reasonably conclude that it might be a good idea to start reducing the amount of new Treasury bond issuances going forward. It might be the only way to escape the Fed's no win predicament with respect to QE and the dollar.
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Old 10-09-2013, 11:25 AM   #15
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Originally Posted by PMBug View Post:
Read this morning where GOP peeps are gaining confidence in their position that not increasing the debt limit won't bring financial armageddon:

http://www.usatoday.com/story/news/p...enial/2937087/

It occurred to me that there is growing evidence that the appetite for Treasuries among foreign investors has chilled[1, 2, 3]. They are increasingly not buying our debt (selling it actually) and this is not related to the current D.C. theater. The Fed, via QE, is the biggest (only?!?) buyer right now [4] and the market for Treasuries might implode if they made any serious effort to make good on their tapering rhetoric (which is why they can't). Realizing this, one could reasonably conclude that it might be a good idea to start reducing the amount of new Treasury bond issuances going forward. It might be the only way to escape the Fed's no win predicament with respect to QE and the dollar.
Good thought, but where do you suppose gold is going to end up fitting in this puzzle?
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Old 10-09-2013, 11:34 AM   #16
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Originally Posted by Aubuy View Post:
Good thought, but where do you suppose gold is going to end up fitting in this puzzle?
U.S. politicians spend more USD than they collect ==> U.S. government borrows more ==> Since no one else is buying treasuries, the FED loads up on more and more treasuries ==> In order to "pay" for them, the FED creates more USD out of thin air ==> This causes inflation ==> The amount of USD need to purchase an ounce of gold increases

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Old 10-09-2013, 12:08 PM   #17
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To be clear, my post above was not indicative of what I expect to happen. I fully expect that the debt ceiling will be raised at some point. I really don't see the political will in D.C. to set a hard limit now or in the near future.
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Old 10-11-2013, 01:18 PM   #18
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They announced the SS COLA announcement wont happen on the 15th- due to the shut down.

I also seen park service was taking the handles off of drinking fountains...
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Old 10-12-2013, 11:36 PM   #19
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Debt ceiling......alas, my wife does not have a debt ceiling.
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Old 10-14-2013, 03:30 AM   #20
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They even gave us a "deadline"... hysteria.

Scaremongering, then they will lift the debt, making everyone happy: "wow, awesome, we actually managed to have more debt"... forgetting that it's actually the huge debt that's the problem!

I wonder if the EU will also pull a trick similar to this one...
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