Raising the US debt ceiling

bush_cheney2004 · July 26, 2011

The new head of the International Monetary Fund (IMF), Christine Lagarde, has warned the "clock is ticking" on a deal to tackle the US deficit and raise its debt ceiling.

What happened to the last "head of the IMF" ?

Unless politicians agree a package by 2 August the US may be unable to pay its bills, triggering an economic crisis.

Not true....Aug. 2nd is quite arbitrary and unfounded as DOOMSDAY.

On Tuesday the dollar fell against the euro whilst US shares opened down.

So...this happens on a routine basis.

But Ms Lagarde warned against drastic cuts in spending, saying these could create a "jobless recovery".

Oh, in other words, she wants the US to continue on a spending and credit binge.

pinko · July 26, 2011

What happened to the last "head of the IMF" ?

Not true....Aug. 2nd is quite arbitrary and unfounded as DOOMSDAY.

So...this happens on a routine basis.

Oh, in other words, she wants the US to continue on a spending and credit binge.

No. She wants the USA to act responsibly.

Edited July 26, 2011 by pinko

bush_cheney2004 · July 26, 2011

No. She wants the USA to act responsibly.

Which means she wants the US to continue on its current path of yet more debt and spending.

pinko · July 26, 2011

Which means she wants the US to continue on its current path of yet more debt and spending.

She has a better understanding of the conseqences of debt default than you display. Your partisan ignorance is duly noted.

Edited July 26, 2011 by pinko

bush_cheney2004 · July 26, 2011

She has a better understanding of the conseqences of debt default than you display. Your partisan ignorance is duly noted.

The US has not / will not default. Try to separate politics from reality while peering over the fence into your "neighbour's" yard.

punked · July 26, 2011

The US has not / will not default. Try to separate politics from reality while peering over the fence into your "neighbour's" yard.

The US defaulted in the 70s it raised US bonds by 1% indefinitely adding trillions to the deficit I believe.

Edited July 26, 2011 by punked

bush_cheney2004 · July 26, 2011

The US defaulted in the 70s it raised US bonds by 1% indefinitely.

That doesn't even make any sense.

bush_cheney2004 · July 27, 2011

More reason not to worry.....Canada's bond rating was actually downgraded by Moody's back in the 90's before any meaningful action was taken by Chretien and Martin. No wonder Canadians are so interested in this...they are re-living a nightmare:

The key point for the reader to remember here is that

Canadian policy makers were only forced into action after the crisis took hold

...and when it hit...disregarding their myopic political ideologies...they did the right thing...their austerity led spending cut budget strategy was swift and decisive...and the positive economic performance since tells the rest of the story.

http://www.businessinsider.com/serious-us-budget-debt-ceiling-and-fiscal-reformit-takes-a-crisisask-canada-2011-7

Edited July 27, 2011 by bush_cheney2004

maple_leafs182 · July 27, 2011

Doesn't this point to the dysfunction of American governance?

I guess...our government isn't any better.

punked · July 27, 2011

That doesn't even make any sense.

Because you don't know history. Google it friend.

bush_cheney2004 · July 27, 2011

Because you don't know history. Google it friend.

Google what...your (edited) nonsense? No thanks.....friend.

punked · July 27, 2011

Google what...your (edited) nonsense? No thanks.....friend.

US Default 1979.

bush_cheney2004 · July 27, 2011

US Default 1979.

...or maybe a dozen others defined by varying circumstances and professors.

punked · July 27, 2011

...or maybe a dozen others defined by varying circumstances and professors.

However this one lead to a interest bump on T-Bills causing trillions in debt to occur.

bush_cheney2004 · July 27, 2011

However this one lead to a interest bump on T-Bills causing trillions in debt to occur.

Sure it did...TRILLIONS! Yawn.....

punked · July 27, 2011

Sure it did...TRILLIONS! Yawn.....

Considering S&P says a 1% bump on t-Bills will cost 100 billion dollars a year now we can assume over years a 1% bump would cost at least a Trillion.

bush_cheney2004 · July 27, 2011

Considering S&P says a 1% bump on t-Bills will cost 100 billion dollars a year now we can assume over years a 1% bump would cost at least a Trillion.

Get your story straight...you said this was for the 1970's.

punked · July 27, 2011

Get your story straight...you said this was for the 1970's.

Yah 30 years ago.

bush_cheney2004 · July 27, 2011

Yah 30 years ago.

That would be 1981 by my figurin'...not 1970's. How is any of this nonsense relevant.

msj · July 27, 2011

Honestly, punked, you could not be bothered to put up a link for the default in 1979?

What, you don't know how?

As for the yield increasing - looking at the graph and methinks that some people make too much out of nothing.

Mistaking (or being biased to see) noise for a long term increase in interest rates is obvious just looking at the graph prior to and after the "little default."

Yes, a temporary effect certainly but hardly a lasting effect like has been claimed.

Not to say that this time won't be different because, well, I doubt the default would be a few T-bills and be the result of some word processing equipment breakdown.

But the 1979 default is much ado about nothing.

Oleg Bach · July 27, 2011

It was said that all gold ever extracted from the earth in all the history of mankind only amounts to about 8 trillion dollars...The American debt is supposedly about 16 tillion dollars.

If gold is the only true and real standard and collateral, backing the buck ... America has spent all the money in the world when they reached the trillion mark. The remaining 8 trillion that is oweing of the full 16 trillion..never really existed to begin with. It is monopoly money and the game being played right now is just that - monopoly.

The debt crisis is a tempest in a tea pot. It's not real. Seeing America was for all of recent history the primary sourse of finacial power globally...It might be safe to say that the actual debt is half of what they percieve - and raising that artifical ceiling can be raised to the heights of heaven and it does not matter.

America has seen fit because of it massive historical trade in fake money - to make more fake money. What the heck - if they faked it this long they might as well keep going. After the gold standard was abaondoned there was no real weighable or measureable real wealth. It's a damned relgion and the high priests of finance including the politicians are having a taste of reality - that they never really had any real money to begin with - and China for instance has taken advantage of American finacial wizardry.

Nations like Saudi Arabia have also taken advantage of this weakness in the American economy - YOU can not keep making something out of nothing forever....or maybe not - Money has become a digital and paper religion - all Obama is foolishly doing is reminding the world and America that the system is not based in reality _ this is a severe error when you are a high priest of Mammon - to stand up and announce that there is no god.

Oleg Bach · July 27, 2011

Because you don't know history. Google it friend.

Google it? Yah the net is full of reality and true and firm historic facts - You can't google your life away and expect this machine to become your memory..you have to accumulate information and hold it in the real and superiour machine - called a mind.

pinko · July 27, 2011

The US has not / will not default. Try to separate politics from reality while peering over the fence into your "neighbour's" yard.

Whether the US defaults or not remains to be seen. As I recall in one of your previous posts you were relishing the thought of increased interest rates precipated by the reckless behaviour of the political class in your country.

bush_cheney2004 · July 27, 2011

Whether the US defaults or not remains to be seen. As I recall in one of your previous posts you were relishing the thought of increased interest rates precipated by the reckless behaviour of the political class in your country.

Interest rates need to go up to stave off inflation and remove the false cushion for banks. The financial "cleansing" is not complete.

What is a political class in "your country"?

punked · July 27, 2011

Interest rates need to go up to stave off inflation and remove the false cushion for banks. The financial "cleansing" is not complete.

What is a political class in "your country"?

But not at the government level, that needs to be done by the Fed. If interest rates raise on the debt for the country it wont lead to an interest rate increase by the fed. You know that right?