Category: US Debt
The analysis published under this category are as follows.
Thursday, January 31, 2013
The Trillion Dollar Coin, Anything Is Better Than Taxes / Politics / US Debt
By: Joseph_T_Salerno
As outlandish as the idea of the $1 trillion platinum coin at first appears, it gives us a glimpse of a monetary arrangement that, although far from ideal, is superior to the current system. Now that the Obama Treasury has definitely ruled out the scheme to mint the coin to circumvent the gimmicky debt ceiling, it is instructive to take a closer look at the reason why it did so and to articulate the lessons that can be learned from the episode.
To begin with, the scheme has ramifications far beyond a one-off political trick to avoid the debt ceiling. Indeed, it presented an implicit challenge to the much vaunted and sacrosanct "independence" of the Fed. That is why, from the very beginning, Fed worshippers in the establishment media – left, right and center – mercilessly mocked the idea and denigrated its supporters as grossly ignorant or irresponsible, although they dared not spell out its full policy implications.
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Friday, January 25, 2013
U.S. Debt, Deficit and Government Spending - The Fiscal Cliff Was A Wasted Opportunity / Politics / US Debt
By: Casey_Research
The label "the fiscal cliff" evoked the fear that something terrible was about to happen if the previously legislated spending cuts and tax increases came into effect. From my point of view, our nation's deficits and debt are growing at an alarming rate and need to be cut back. The reason these laws were enacted was to offer markets some hope that we would eventually work toward eliminating our serious deficits. But the prevailing opinion that such drastic decreases in our deficit would slow our economy and bring recession created the impression that this "cliff" must be avoided.
Friday, January 18, 2013
The Ticking Trillion Dollar Debt Bomb / Politics / US Debt
By: Graham_Summers
Since the EU Crisis went into overdrive in 2010, EU politicians have largely resorted to political posturing rather than implementing any actual financial solutions to the EU’s debt and banking crisis.
To clarify that statement, we view a “real solution” as one that A) cleared bad debts from the system, B) brought debt levels down to manageable levels, and C) got the troubled country’s economy back on track.
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Thursday, January 17, 2013
Open Fort Knox! The Ink at the Money Printing Press Is Dry / Politics / US Debt
By: InvestmentContrarian
George Leong writes: The government needs money fast. The problem is that the bank vaults are closed for the time being, and unless they are opened by early March, America could face a cash crunch.
The intense battle between Congress and President Barack Obama, who is requesting an immediate increase to the current national debt limit of $16.4 trillion, is ongoing, but it needs to be resolved soon, as the current national debt subject to the limit is $16.39 trillion. Obama is threatening possible delays to Social Security and veterans’ benefits, along with an impact on the government payroll, if the cash doesn’t come. (Source: Lee, C.E., and Hook, J., “Obama Escalates Debt Fight,” Wall Street Journal, January 14, 2013.)
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Thursday, January 17, 2013
U.S. Government Raids Pension Funds to Avoid Debt Default / Politics / US Debt
By: Money_Morning
Diane Alter writes: The U.S. Treasury, in order to avoid default, has resorted to an eyebrow-raising move: it has borrowed from the federal employee pension fund as the country nears its debt ceiling.
The U.S. government stopped investing in the federal employee pension fund Tuesday "to avoid breaching the statutory debt limit," according to a letter Treasury Secretary Timothy Geithner sent to Congress.
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Wednesday, January 16, 2013
The Trillion Dollar Coin Trick / Politics / US Debt
By: Peter_Schiff
The birth, and the apparent death, of the trillion dollar platinum coin idea may one day be recalled as a mere footnote in the current debt crisis drama. The ultimate rejection of the idea (which was to use a loophole in commemorative coinage law to mint a platinum coin of any denomination) by both the the President and the Federal Reserve seems to offer some relief that our economic policy is not being run by out-of-touch academics and irresponsible congressmen. In reality, our government has been creating more than one trillion dollars out of thin air every year for the past five. The only difference is that the blatant dishonesty of a trillion-dollar platinum coin is so easy to understand that the public simply couldn't be expected to swallow it. The American people are more than willing to be fooled, but they won't tolerate so simple a ruse.
Wednesday, January 16, 2013
U.S. Debt Ceiling: Why Platinum and Gold Are Not the Answer / Interest-Rates / US Debt
By: Eric_McWhinnie
In the last press conference of his first term, President Barack Obama warned Congress that it must raise the debt ceiling to avoid disastrous side effects. He goes on to claim that failure to raise the ceiling could cause delays in Social Security benefits and checks for veterans. As usual, the two political parties are not expected to resolve their bickering before the last possible moment, which is creating a debate over bandaid solutions. However, ridiculous platinum coins and the nation’s gold reserves appear to be off the table.
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Tuesday, January 15, 2013
President Obama Utilizing Media to Pressure Republicans on Debt Ceiling / Politics / US Debt
By: EconMatters
Let me first state that I am not a Republican or a Democrat, or a Tea Party advocate; I just look at individual issues based upon their merit. The issues and the right solution is what is important to me, and not collective party ideology. But president Obama trying the same tactics of negotiation in the media to frame the debt ceiling debate as the Republicans being irresponsible, and not paying the Country`s bills is just media manipulation at its finest.
This tactic is very transparent and apparent to the educated members of society, unfortunately the tactic worked with regards to the fiscal cliff, and he is hoping to do the same thing again by putting all the pressure on the Republicans with these media shows, and essentially making the Republicans look like the bad guys here.
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Sunday, January 13, 2013
Silly U.S. Debt Ceiling / Default Debate Drama / Politics / US Debt
By: Mike_Shedlock
Of all the over-dramatized nonexistent threats, the silly worry of the day is the US is at risk of default if Congress does not raise the debt ceiling.
Earlier today, I saw a couple of articles outlining how and why a US default could happen. Well, it won't, and there is no need for all the surrounding drama either.
Friday, January 11, 2013
Gargantuan and Growing: The U.S. Debt Figure You've Probably Never Heard Of / Interest-Rates / US Debt
By: EWI
The widely reported $16.1 trillion federal debt is a drop in the bucket
Financial transparency is a must for U.S. publicly traded companies. But if the federal government had to abide by those same regulations, more Americans would know that the often-reported $16.1 trillion federal debt doesn't come close to the truth about the nation's liabilities.
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Friday, January 11, 2013
U.S. $1 Trillion Coin Isn’t the Right Answer to Our Debt Ceiling Crisis / Politics / US Debt
By: Money_Morning
Ben Gersten writes: There's increasing support for the idea of minting a $1 trillion coin to help the United States avoid hitting the debt ceiling.
Even those supporting the idea - including The New York Times' Paul Krugman - admit it sounds "silly," but say it deserves consideration in that it could help solve one of our country's biggest economic issues.
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Thursday, January 10, 2013
Krugman's $1 Trillion Platinum Coin / Politics / US Debt
By: Jesse
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Tuesday, January 08, 2013
Fiscal Cliff Averted, but the Massive Debt Will Limit Government Flexibility / Politics / US Debt
By: InvestmentContrarian
George Leong writes: Well, the doom and gloom of the fiscal cliff was averted in the nick of time, which in turn, pleased Wall Street and gave stocks a boost to begin the new year.
While the deal was a nice compromise between the two parties on the tax issues, there is a lot of work ahead for President Obama, as the statutory national debt limit of $16.4 trillion nears. As of this morning, the national debt balance used for the limit stood at a superlative $16.39 trillion. The headline national debt of $16.43 trillion is actually already above the limit, but don’t worry, the Treasury Department said it will be able to pay its debt payments and bills. Of course, we know this will also hold until the extended deadline on March 1.
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Thursday, January 03, 2013
Cold Hard Truth About the Fiscal Cliff Deal / Politics / US Debt
By: Money_Morning
Martin Hutchinson writes:
In the end, a last-minute deal emerged. Just like that, the fiscal cliff crisis was averted.
In the waning hours of New Year's Day, Congress voted to avoid a large package of tax increases, along with some modest spending cuts.
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Thursday, January 03, 2013
Fiscal Cliff Averted, But Debt Ceiling Looms / Politics / US Debt
By: Asha_Bangalore
Happy new year to all!
We host an open house each January 1. Breakfast is served starting at 9, lunch at 1, and cauldrons of homemade soup at 5:30. By 8, hopefully, the assembled multitude is hale, hearty, and ready to live up to their New Year’s resolutions.
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Wednesday, December 26, 2012
Dysfunctional Washington Leans on Fed’s Money Printing Press / Politics / US Debt
By: Michael_Pento
It should now be clear to all Americans that our government is completely incapable of voluntarily reducing our fundamental problem of excess debt. The inability of Washington D.C. to address spending, even under the duress of a legal obligation to do so, is flagrantly obvious.
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Tuesday, December 18, 2012
Fiscal Cliff Is a Diversion From Dollar Bubble Trouble / Politics / US Debt
By: Paul_Craig_Roberts
The “fiscal cliff” is another hoax designed to shift the attention of policymakers, the media, and the attentive public, if any, from huge problems to small ones.
The fiscal cliff is automatic spending cuts and tax increases in order to reduce the deficit by an insignificant amount over ten years if Congress takes no action itself to cut spending and to raise taxes. In other words, the “fiscal cliff” is going to happen either way.
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Sunday, December 16, 2012
Sorting Out a Decade of Debt, Investment Conclusions / Interest-Rates / US Debt
By: John_Mauldin
In today's Outside the Box I bring you two pieces that, at first glance, may not seem to have much to do with each other. First, Bill Gross, PIMCO managing director, runs down the fierce structural headwinds that our hard-pedaling global economy faces over the next decade. I am going to deal at length with not only his GDP projections for the rest of the decade but those of Grantham and others in the last two Thoughts from the Frontline of this year. This is a challenging environment for traditional portfolio construction, but it’s par for the course as we slog through the secular bear market I was first writing about in 1999.
Saturday, December 15, 2012
U.S. Caught in a Alarming Trap of Continuum of Deficit Spending / Interest-Rates / US Debt
By: David_Galland
Late at night on November 6, along with John Mauldin, Doug Casey and a group of partygoers in a café here in Cafayate, we watched on a small television as Obama's contract was renewed by a majority of the mob. As was the case with many readers, I suspect, my initial reaction was disbelief.
While I try not to pay a lot of attention to the careers of individual politicians, but rather prefer to monitor the carnage they inflict on the world in the collective, I sincerely believed that Obama's steady transgressions against commonsense economics, individual liberty and the rule of law would see him unceremoniously turned out.
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Wednesday, December 12, 2012
Why the Ballooning Student Debt Should Be on Your Radar / InvestorEducation / US Debt
By: InvestmentContrarian
John Paul writes: We’re two weeks away from surviving the Mayan Doomsday and three weeks away from stepping over the fiscal cliff. But the unabated student loan debt is just getting warmed up. Instead of dealing with the problem, Washington’s policies continue to stoke the fire. And that economic strain spells continued misery for America’s ongoing credit crisis woes.