Ahhh more talk about the debt ceiling yet again!!!

74 times since 1962 and 10 times since 2001 the debt ceiling has been raised......I dont think they will have a problem raising it another 842 times in the next 20 years either. Looking at history the chances of them raising the debt ceiling is 100%, there is NO need to even ask if they are going to raise the debt ceiling, the answer is YES they are going to raise the debt ceiling.



The debt ceiling's been raised some 74 times since 1962. Ten of those times have occurred since 2001.





More Conservatives Tell GOP: Don't Mess With Debt Ceiling


Published: Wednesday, 16 Jan 2013 | 9:48 AM ET
By: Mark Koba
Senior Editor, CNBC


Republican lawmakers—and specifically the Tea Party wing of the GOP—are being told by a growing number of conservatives to stop using the debt ceiling crisis to force major spending cuts.

Instead, they're being told to battle over the separate issue of sequestration.


Alan Simpson on Debt Ceiling Fight
What happens if the U.S. does not get the spending cuts, and where is the U.S. economy headed in the next 10 years? Alan Simpson of the Fix the Debt Campaign, provides perspective.
Sequestration—the massive forced cuts in government spending that were delayed by the "fiscal cliff" deal— will happen automatically on March 1 unless Congress votes to change it. The fight over that issue promises to be just as bruising at the debt ceiling.

The debt ceiling, meanwhile, has to be raised by Congress sometime in the next two months from the current $16.394 trillion or the U.S. won't be able to pay its bills. (Read more: Debt Ceiling Battle: Why No One Agrees on Anything)


"It would be a grave mistake to use the debate on the debt ceiling to get President Obama to agree to spending cuts," Alan Simpson, co-founder of the Campaign to Fix the Debt and former GOP senator from Wyoming told CNBC's "Closing Bell" Tuesday.

"I know they're (GOP lawmakers) going to try it and how far they'll go with that game of chicken I have no idea," said Simpson, who was co-chair of the Simpson-Bowles Commission that looked at reducing government debt.

Other conservatives like former House Speaker Newt Gingrich have also warned against holding up the debt ceiling vote. So have the Chamber of Commerce and the Business Round Table— with each saying it would be bad politics and hurt the GOP's standing with the public.

And now, a group funded by the billionaire Koch Brothers—Charles and David—is calling for the GOP to pull back during debt ceiling talks.


Visions Of Our Land | The Image Bank | Getty Images
"We're saying focus on overspending instead of long-term debt," Tim Phillips, president of Americans for Prosperity said in an interview. "We're going to have a hard line on the sequester cuts." (Read more: Koch Group Urges Restraint on Debt Talks)

President Obama has declared that he won't negotiate over the debt ceiling. He's said that raising the ceiling does not authorize any new spending but simply allows the government to continue to pay for obligations to which Congress has already agreed. Even Federal Reserve Chairman Ben Bernanke has backed that view.

Analysts say that allowing the U.S. to default on payments for items like Social Security, Medicaid and defense could lower the country's credit rating and send stock markets into a freefall.

The debt ceiling's been raised some 74 times since 1962. Ten of those times have occurred since 2001.

Republicans like Sen. Tom Coburn (R-Okla.) claimed that a Republican-led refusal to raise the debt ceiling could be a "wonderful experiment" in forcing the government not to spend money on "stupid things."

The Tea Party Patriots, the nation's largest tea party group, said the Obama administration "has spent four years driving up the deficit and stalling when it comes to spending cuts, forcing Republicans to take drastic action such as threatening to hold the line on raising the debt limit or shut down the government to get Democrats to negotiate on spending."



Uncle Sam's Full Faith and Credit
Lawrence Lindsey, The Lindsey Group CEO, discusses what he is telling investors about the potential downgrade of U.S. debt and deficit deals.
But major cuts are coming in March due to sequestration. Congress was unable to reach agreement on forced spending cuts in January that were part of the fiscal cliff deal. They were delayed until this March as part of the American Taxpayer Relief Act of 2012—the deal that avoided the full 'fiscal cliff.'

The delay was to give lawmakers more time to agree on which programs would actually receive cuts.

The deficit reduction sequester is designed to enforce savings of $1.2 trillion through 2021. It calls for roughly a $55 billion cut in defense and a $55 billion cut in non-defense spending.

Will the GOP listen to it's critics and vote to raise the debt ceiling? Timothy Nash, a professor in economics at Northwood University, believes they will and still remain a force on Capitol Hill.

"I think the Tea Party still has relevance if it sticks with the view of getting our fiscal house in order," said Nash. "Democrats and Republicans share the same belief about lowering the debt."

"The debt ceiling is a short term issue and will likely get done," Nash argued. "The real issue is long term debt and everything should be on the table when it comes to cuts. We can't keep kicking our economic can down the road."
 
yawn another debt ceiling article.....
I like the headline on this one, "could financial markets handle a US debt default"

Now are they really asking a question about what could happen? Why are they wasting their time writing such a worthless article when we all know there is going to be NO default, this article is a fucking joke..everytime we get close to the debt ceiling they start to analyze what can possibly happen, however we dont know what could happen because its never happened before, so all this is just blah blah blah blah.....


Could Financial Markets Handle a US Debt Default?


Published: Thursday, 17 Jan 2013 | 12:41 PM ET



Squabbling in Washington over the debt ceiling is again raising the specter that the United States may be forced to delay payments on its debt. While the stigma of a default would be damaging enough to investor sentiment, the chaos from a breakdown in financial markets' systems that might result would be even scarier.

A failure to make payments on U.S. Treasurys, however brief, would create widespread damage in short-term funding markets, which are crucial to daily operations of financial institutions, investment firms and many corporations, according to analysts and investors.

In the event of a default, confusion would be rampant as trading systems struggle to identify, transfer and settle bonds that have matured but have not been repaid. Interest rates would surge and investors would likely sell stocks and commodities as they fled risky assets, analysts said.

Debt Ceiling: Real Tragedy or Soap Opera?
CNBC's Steve Liesman explains what constitutes a default and how it would impact the U.S. economy.
But that doesn't mean investors would necessarily run to the safety of Treasurys. Many U.S. government bonds could be shunned as investors worry about which issues are in default - even longer-dated issues that could have a coupon payment due that would potentially be in jeopardy.

A default could also trigger a wider paralysis in the financial system that could quite quickly stall the economy, as happened at the height of the financial crisis in September 2008.

For starters, money market funds are not allowed to hold defaulted collateral. These funds pulled back on making loans in 2011, when the ceiling was last an issue, and some analysts fear this time could be worse, potentially creating broad funding problems and send the cost of borrowing in short-term markets, including those in repurchase agreements or loans based on Libor -- surging.

The U.S. Treasury hit its $16.4 trillion debt ceiling — the legal amount it is allowed to borrow — on New Year's Eve. The Treasury Department will run short of funds as early as mid-February, so legislation is needed to increase the borrowing limit. This had been a formality for years but turned into a political standoff between congressional Republicans and the White House over government spending levels in the summer of 2011. The resulting battle roiled markets concerned about U.S. political gridlock and its impact on the economy.



The likelihood of a default on U.S. Treasurys has in the past been seen as so low that many parts of the market fail to even account for it in planning and paperwork. For example, unlike other debt, such as corporate bonds, Treasurys have no grace period to make up for missed interest or principal payments.



Many banks and investors may not even have the systems needed to screen out which Treasurys have principal or interest payments due that are most at risk of not being paid.

"No one is going to build a system to assume you have a defaulted Treasury floating around there; it's not a baseline assumption," said Michael Cloherty, head of U.S. interest rate strategy at RBC Capital Markets in New York.

Treasury bills maturing at the end of February and in March are most vulnerable to default, though analysts said hundreds of other issues also have coupon payments due at the end of February. Rates on some short-term debt maturing in that time have risen and now yield more than similar debt maturing in April, a sign that a dislocation has started.



The chain reaction from a potential default suggests a slow spread of damage through various parts of the banking system, particularly the $5 trillion repurchase agreement market, which many companies rely on for funds.

The Treasury Market Practices Group (TMPG), a group of market participants, has been looking into operational challenges of a U.S. default since the 2011 fight. It noted that other major events such as a terrorist attack, a failure of trading or other operational systems, or a natural disaster could also delay a debt payment.

One potential problem is that the New York Fed's Fedwire Securities Service, which is used to hold, transfer and settle Treasurys, would need some manual daily adjustments, as it otherwise can't transfer bonds that are past their maturity date, the group said in meeting minutes from last year. Other systems may have similar problems, it said.

Treasurys are widely used to back loans in the repo, or repurchase agreement, market, and in privately traded derivatives and for a host of securities traded on exchanges. Ownership and possession of the bonds is transferred regularly as part of this collateralization process.

But put sand in the gears of the transfers, and anarchy may ensue.

(Read More: How the Debt Ceiling Debate Hits Currencies)

After the September 2001 attacks on the World Trade Center and the Pentagon, market participants struggled to identify who their counterparties were in the repo market, and even had difficulty grasping whether their net Treasurys position was a long or short one, after trading records were destroyed.

The number of trade "fails," when the borrower doesn't supply Treasurys to settle a loan, surged in the weeks after the attacks, initially rising because of operational problems and then staying high as the cost of obtaining Treasurys to settle a loan was as expensive as the cost of allowing a fail.

To resolve the issue, the Treasury held a special auction of 10-year notes to increase supply and help settle the loans.

The U.S. has defaulted once before, in 1979, when lawmakers were blamed in part for allowing negotiations to go down to the wire before raising the debt ceiling.

After that, back-office errors at the Treasury caused the government to be late in redeeming three series of Treasurys bills, according to an academic paper by Terry Zivney and Richard Marcus published in the Financial Review in 1989. The failure caused rates to rise, and the government faced lawsuits from investors hurt by the delays in repaying the bonds, they said.

Markets now are far more complicated. Battles over ownership, interest paid or owed and a host of other issues relating to the transfer of the securities would likely be mired in legal disputes. U.S. debt is also considerably higher, and there is greater foreign ownership of Treasurys. The economy is also more vulnerable, making the risk of a creditor exodus a far more damaging prospect for the country.

"The minute we default, there would be a complete collapse in the bond market," said Peter Schiff, chief executive officer of Euro Pacific Capital and a critic of U.S. government spending habits.

That would leave the U.S. struggling to refinance more than $4.6 trillion that come due within two years, including $3 trillion of Treasurys due to mature in 2013.
 
Quote from piezoe:

I respectfully disagree. I'm not concerned with the debt acquired because of the financial collapse, the recession, and the need to apply stimulus to keep us out of depression and deflation. I think exactly the right thing was done and is being done, although it might have been done a little better-- but it's been done well enough to save this country from a disastrous depression. We are the model for the rest of the World with regard to how best to deal with a major financial collapse and a threatened depression.

The debt ceiling is moot. We are constitutionally bound by the 14th amendment. We must pay our bills. The executive branch can ignore the debt ceiling if they are forced to. Constitutional law trumps statutory law.

The focus right now should be on jobs even if that requires still more debt, and it will.

The discussion in Congress should be focused on jobs, bringing the cost of medical care down, and scaling back, in small steps, the defense department so as not to make the employment situation much worse. It is a matter of moving dollars from where they are being inefficiently and unproductively spent on wasting assets to where they can be efficiently and productively used. The result of mismanaging our assets has been a growing poor class, a shrinking middle class, and an increasing concentration of wealth among a tiny fraction of the population. Concentration of wealth among a few percent of the population is a normal condition for the country going back to colonial days-- but the concentration has now attained a level where it has become dangerous to the economy and stability of the country. Economic conditions must be established that will result in a rebirth of opportunity and the spontaneous growth of a strong middle class.

Once we bring our unemployment rate down to 5-6%, and bring our medical and defense costs in line with other developed nations, revenues will increase dramatically relative to expenditures, the debt problem will resolve itself, and there will be plenty of money, provided we avoid getting entangled in further unproductive, expensive, and endless wars.

We could start by cutting our order for 2500 unneeded F-35's in half. (We'd still acquire 1250 unneeded F-35's. That should be enough!)

There is plenty of money, it is distributed ineffectively among poorly ordered priorities.

Drastic fiscal cuts will be disastrous. We need to rearrange how we are spending the revenue we do have, and continue borrowing and deficits at a declining level while we concentrate on graduated, controlled reductions in medical and defense spending.

A major overhaul of how we pay for medical care, in conjunction with the staged introduction of Obamney care is unavoidable. We might as well get on with it.
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While this sounds good on paper, I don't see how this scenario is even remotely possible. Our fiscal issues as a country go well beyond just misappropriating our funds into poorly ordered priorities. Not worrying about our debt problem is what got us here in the first place, and I don't think waiting until our economy is fixed before addressing the issue is a viable solution. I could be just a pessamist but I don't honestly see America with 5-6% unemployment and running a budgetary surplus in the short term future or even the long term future. You can keep pumping money into trying to create jobs, but where are these jobs actually going to come from? Many of the unemployed right now come from manufacturing jobs that just aren't going to come back in the near future. And even if on the low probability that the government can get to a place where its revenues are more than spending, i find it unlikely that the gov't would opt to pay back some of the debt its accrued versus using that surplus on other projects.
 
I appreciate your opinion Pliny. In a post in another thread I identified places in the economy where we need to create many more jobs. I don't want to repeat that post, but I'll try to find it and link to it. While we are losing some jobs in manufacturing, we can create more, highly valuable, non-manufacturing jobs than the number of manufacturing jobs we are losing. There are also some surprising, new manufacturing opportunities coming in the future. The U.S. will never compete in the cheap labor market, but we are very competitive in technical areas, and all areas of advanced engineering, science and materials. What's going to surprise many is that via robotics we can even become competitive in manufacturing again, in spite of our labor not being cheap. We will have to concentrate on producing goods of very high quality, as the Germans do. The world market for high quality goods is going to grow amazingly.

There is plenty of money in our economy, but it is not being used efficiently enough. I'll mention just a single area where we need more than a million more workers, in fact we have no choice, we must create and fill these jobs. I'm talking about primary and secondary education. We must invest in top notch public schools. That will require bringing class sizes down by half. And that is going to require almost doubling the number teachers. We need to do common sense things like putting 6 years of foreign language instruction into 100% of our grade schools, and expanding vocational training opportunities. We need to bring back art, music, and P.Ed. to schools that have eliminated them. Educators have known for years that math, language, art and music belong in the early years of a child's education. These subjects can not be put off until Junior high or high school. We must have a public education system that is as good or better than that in any other country, or we are finished. We will be permanently relegated to second class status if we don't do this.

Let's swallow our pride and model our public schools after one of the twenty or so countries that have better public schools than we. We could start at the top with Finland, and work our way down the list.

There are many other areas in both the public and private sectors where we should be creating jobs. There can be more than enough important and meaningful jobs created to absorb those that must be slowly eliminated from our incredibly inefficient, wasteful, and unaffordable defense and health sectors.

I'll look for the link.

We are going to recognize very soon that we sent some folks to Washington to run our government that don't believe in government! We hadn't realized when we elected these folks that they weren't going to try and fix our government like we had hoped; instead they are trying to wreck it! I hope they won't be there much longer. I sense the country is getting rather tired of this nonsense. We need the majority in both parties to pull in the same direction at least more than 50% of the time. Now we have them pulling in opposite directions 99% of the time..
 
Quote from piezoe:

I appreciate your opinion Pliny...
More...

I agree with you on some of the points you mentioned. Traditional manufacturing jobs are not going to return to America anytime soon, so i agree that the only way to combat the job loss is by finding new opportunities that currently aren't being served in the manufacturing industry. The issue lies within our educational system as you brought up. I do think as a country we need to put a bigger importance on fixing our eductaional system, but throwing more money at the problem and hiring more teachers isn't the solution. The entire system needs to be blown up and re evaluted on how to better prepare our students for real world job needs going forward. I don't know what the best model is, wether its more charter and trade schools or even schools more specifically focused. I just know that we will keep falling farther behind if we stick to the same process where students don't really learn much in primary school and go on to get a degree in eurpean history, general studies, or basket weaving in college. Those students will not be prepear to provide any substance to the job market all while being saddled with a $100k in student loan debt that they can't pay back. This process weighs on the economy and needs to be changed, and it has to come from Washington, but I don't see the government as being willing to even entertain radical changes because it would rock the status quo.
 
my son in law speaks very little English

But he knows how to cook really good food

trying to set him up with just a little food cart outside the local bar at night was a bureaucratic nighmare.

I know it wasn't that way back in 1870 NYC.

I had all the money, money was not a problem.

Finally, it just became easier to do some landscaping under the table.

that's just one story

multiply it by 25 million who are unemployed, and it starts to add up
 
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