[bigdogmom] By Alain Sherter / MoneyWatch/ October 7, 2013, 7:40 AM Debt ceiling: Understanding what's at stake 217 Comments / 1K Shares/ 464 Tweets/ Stumble/ Email More + . . . (MoneyWatch) It is the economic calamity that no one expects and everyone fears. Experts agree that failing to raise the nation's debt ceiling by Oct. 17, when U.S. officials say the government will run out of money to pay its bills, would gravely wound the economy, and perhaps even throw it back into recession.
Because Treasury bonds and the dollar are cornerstones of the global financial system, meanwhile, the shock wave would be felt around the world.
Play Video Bank CEOs: Don't play games with debt ceiling . "The potential is disastrous," said Gus Faucher, senior economist with PNC Financial Services Group. "We would see interest rates spike across the board. We'd see a huge crash in the dollar.
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People count on lending their money to the federal government and getting it back, and if that trust is taken away -- it's never happened that we haven't met our obligations as a nation -- then that has very, very negative consequences for the U.S. economy."
The consequences are so severe that, even as the government shutdown enters its second week, most seasoned political observers still expect Congress to ultimately reach an eleventh-hour deal to lift the government's borrowing limit.
But what exactly is the debt ceiling, and exactly how worried should Americans be that it could come crashing down? What is the debt ceiling? The debt ceiling is the total amount of money the U.S. government can borrow (by selling Treasury bonds) to pay its obligations, including interest on the national debt, Social Security and Medicare benefits, and many other payments.
That limit is currently $16.7 trillion, although technically the government already exceeded it in May. The Treasury Department has since used various measures to continue borrowing. During World War I, amid uncertainty regarding the total costs of funding U.S
[..SpecialAgentGibbs] FOLKS, THIS HAS BEEN A LONG HARD JOURNEY FOR SO MANY. I'VE WATCH PEOPLE COME, AND PEOPLE GO. I'VE SEEN THE LIFE STORIES OF COUNTLESS. SEEN YOUR JOY, AND YOUR HARDSHIPS. I'VE PRETTY MUCH PUT MY ENTIRE LIFE ON HOLD, WAITING FOR THE MAGICAL DAY THIS RV/CE WOULD HAPPEN…
I KNOW I'M NOT ALONE IN THAT. HOWEVER, FOR ME, THE TIME HAS COME TO TAKE MY LIFE OFF HOLD, AND RESTART MOVING FORWARD. HAVING BEEN VERY RECENTLY PRESENTED WITH THE OPPORTUNITY TO ACQUIRE THE MEANS TO DO JUST THAT, I FEEL AN URGENCY TO TAKE THE BULL BY THE HORNS, AND RUN WITH IT.
TODAY'S RV/CE INTEL MAY IN FACT BE THE DECIDING FACTOR FOR ME. THE SEEMINGLY ENDLESS CYCLE THAT IS SO EVIDENT JUST ISN'T PRODUCTIVE IN ANY WAY FOR ME. PLEASE DO NOT MAKE ANY PERSONAL DECISIONS BASED UPON WHAT I DO, EACH MUST FOLLOW THEIR OWN PATH IN THIS LIFE.
THOUGH I MAY VISIT FROM TIME TO TIME IN THE FUTURE, PLEASE UNDERSTAND THAT MY NEW PATH WILL DEMAND MY FULL, UNDIVIDED ATTENTION FROM HERE FORTH.
CONSIDER THIS GOLD STAR TO BE OFFICIALLY HUNG ON THE WALL.
I SINCERELY WISH THE ABSOLUTE BEST FOR EACH & EVERY ONE OF YOU. TAKE WHAT YOU HAVE LEARNED FROM THIS SITE, AND PROSPER WELL. PERHAPS, JUST PERHAPS, SOMEDAY I'LL SEE YOU ALL ON THE OTHER SIDE.
[..sambo] ..SpecialAgentGibbs I WISH YOU ONLY THE BEST IN YOUR FUTURE ENDEVOUR - YOU HAD BEEN A VALUEABLE ASSET TO ME AND THE OOM TEAM - PLEASE LET GOD GUIDE YOU AND KEEP YOUR FAITH HIGH - LOVE YOU BROTHER
ShawnW: Hey Everyone,
Wanted to stop in today, while I dont post much anymore, I did feel like commenting on my views of the current state of this reset plan. As I do find it interesting. First off I want to say that I firmly believe there is a plan in place.
While that plan may shift and morph based on the seemingly an unfathomable number of decision points, I do firmly believe there is a plan in place and being followed, just after it is written in many cases. So lets keep that in mind as we walk down this path today.
I posted a few weeks ago, that I did not think this was the true reset we would see roll out, but more of suedo reset, so rather than just kicking the can down the road like we normally do, we can hopefully at least get a new can to start kicking out of the deal. I am still of that belief and seeing this debt ceiling debacle affirms that for me. Either way, this is just my opinion and of course could be wrong.
So if there is a plan in place, where are we in that plan. I think we are very close to the end, like the next few days should be very interesting. Do I think this is hinging on the debt ceiling announcement, in some sort I would say yes.
There is a fork in the road and we have been indoctrinated over the last decade or so to "know" that our government takes these debt ceiling negotiations right down to the last hour and amazingly comes out with a deal to once again kick the can down the road. What if this time they do not? What if we fall over that cliff?
What would that do to not only the dollar, but the global economy in the short term. I know we have enough revenue coming in to cover our interest on our debt, that is not the part I am talking about. I am talking about the perception that can be created in the MSM that the US has officially defaulted.
This gives the global economy and currencies free reign to go nuts. Is that not the type of "problem" that this "solution" we have all been eagerly awaiting would amazingly fix?
We have to remember with our government, it is always create a solution (or next step in the global plan) and next create the problem that solution will "fix".
While the above is my preferred theory at the time being, the other fork in that road is to kick the can once more and silently introduce this reset over time, improving the economy and showing the numbers improving due to whatever public reason the deem the best at the time. The issue I have with that is that is does not force the global economy into the plan where as the first option does, and seems to roll this reset out much smoother to me.
All that to say which ever path we go down, I do believe we are watching a plan roll it self out slowly and we are near the end of it. So rather than everyday hyperventalating because the text (or non text) has not arrived, lets just sit back watching, knowing that we are watching a historic event unfold.
Should be an interesting week.
See Tony's latest Post this a Morning......
That should give you the latest update!!!!
And your right.......THIS HAS BEEN PLANNED OUT (as much as I don't like it).
ShawnW: I read it before posting this thanks, I read the one before that and heard it a few times before that on his CC. Also heard the banks have been ready, over and over over. That information IMO is as important as the rest, for me it just doesnt give the full picture, or we would not be sitting here still. I love TNT and Tony for what he gives to all of us, but just giving another angle to view.
I think this event NEEDS to be happening everyday at certain levels to hide the RV tree in a forest of its happening. They know there is no way to surpise us with this event, so why not dull us into boredom with the its going to happen tonight and when it really does, we will have heard it over and over.
LaGal] Sherlock Holmes and Dr Watson were going camping. They pitched their tent under the stars and went to sleep. Sometime in the middle of the night Holmes woke Watson up and said: “Watson, look up at the stars, and tell me what you see.” Watson replied: “I see millions and millions of stars.” Holmes said: “and what do you deduce from that?” Watson replied: “Well, if there are millions of stars, and if even a few of those have planets, it’s quite likely there are some planets like earth out there. And if there are a few planets like earth out there, there might also be life.” And Holmes said: “Watson, you idiot, it means that somebody stole our tent.”