Republican Mainstream Flirts with Brief US Default

[Arnie]

What's the alternative? More spending?

This guy makes some good points. If you're a trader maybe you've heard of him.......

'People aren't going to wonder whether 20 years ago we delayed an interest payment for six days. They're going to wonder whether we got our house in order.'.
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What If the U.S. Treasury Defaults?

By JAMES FREEMAN
'A financial crisis is surely going to happen as big or bigger than the one we had in 2008 if we continue to behave the way we're behaving," says Stanley Druckenmiller, the legendary investor and onetime fund manager for George Soros. Is this another warning from Wall Street that Congress must immediately raise the federal debt limit to prevent the end of civilization?

No—Mr. Druckenmiller has heard enough of such "clamor and hyperbole." The grave danger he sees is that politicians might give the government authority to borrow beyond the current limit of $14.3 trillion without any conditions to control spending.

One of the world's most successful money managers, the lanky, sandy-haired Mr. Druckenmiller is so concerned about the government's ability to pay for its future obligations that he's willing to accept a temporary delay in the interest payments he's owed on his U.S. Treasury bonds—if the result is a Washington deal to restrain runaway entitlement costs.

"I think technical default would be horrible," he says from the 24th floor of his midtown Manhattan office, "but I don't think it's going to be the end of the world. It's not going to be catastrophic. What's going to be catastrophic is if we don't solve the real problem," meaning Washington's spending addiction.

Continued here:
http://online.wsj.com/article/SB10001424052748703864204576317612323790964.html

 

[RobtF]

Quote from dewton:

I've said it before and i'll say it again...

THE US GOVERNMENT DOES NOT NEED TO GO INTO DEBT TO FUND ITSELF BECAUSE IT HAS POWER GIVEN BY THE CONSTITUTION TO PRINT MONEY!!!!!!!!

Yes the founders of this nation intended for congress to print money- not some private agency (Federal Reserve) via the IDIOTIC idea of debt monetization.

This is something everyone's learned in grade school. The solution is so mindblowingly simple it just BAFFLES me that there are even debates on debt ceilings and defaults even among seemingly well-educated and intelligent people!!!

Isn't this circular? Yes the Treasury can print money but it can only spend it as authorized by Congress.

 

[RobtF]

Quote from Arnie:

'A financial crisis is surely going to happen as big or bigger than the one we had in 2008 if we continue to behave the way we're behaving," says Stanley Druckenmiller, the legendary investor and onetime fund manager for George Soros. Is this another warning from Wall Street that Congress must immediately raise the federal debt limit to prevent the end of civilization?

No—Mr. Druckenmiller has heard enough of such "clamor and hyperbole." The grave danger he sees is that politicians might give the government authority to borrow beyond the current limit of $14.3 trillion without any conditions to control spending.

One of the world's most successful money managers, the lanky, sandy-haired Mr. Druckenmiller is so concerned about the government's ability to pay for its future obligations that he's willing to accept a temporary delay in the interest payments he's owed on his U.S. Treasury bonds—if the result is a Washington deal to restrain runaway entitlement costs.

"I think technical default would be horrible," he says from the 24th floor of his midtown Manhattan office, "but I don't think it's going to be the end of the world. It's not going to be catastrophic. What's going to be catastrophic is if we don't solve the real problem," meaning Washington's spending addiction.

With all due respect - Mr Druckenmiller will not be among those who suffer most when the SHTF.


No—Mr. Druckenmiller has heard enough of such "clamor and hyperbole." The grave danger he sees is that politicians might give the government authority to borrow beyond the current limit of $14.3 trillion without any conditions to control spending.


Obama offered a reasonable plan to reduce deficit by 4 trillion over 12 years but Republicans rejected it because it would close some tax loopholes. I do think we have a real problem when one political party is dogmatically intransigent. Let me guess, Druckenmiller favors no new taxes on the "job creators".

 

[bullmarket79]

Look with the Bush tax cuts all federal debts will be paid off by 2011, we still have time for the Bush tax cuts to work, stop worrying. The Republicans crying we need a balanced budget amendment is silly, send me a term limits amendment, now that would work.

 

[Random.Capital]

Quote from RobtF:

Obama offered a reasonable plan to reduce deficit by 4 trillion over 12 years ...

No, he didn't.

Neither did the GOP.

Neither did the Tea Party brigade.

Voters refuse to let services be cut, and the refuse to allow taxes to rise. Until they are backed into a corner - or until a significant leader emerges - nothing is going to change.

 

[cgtrader]

When did the USA turn into a 24hr circus show for the rest of the world?

How can you not be completely ashamed of being ruled by these people?

 

[cgtrader]

Quote from Random.Capital:

No, he didn't.

Neither did the GOP.

Neither did the Tea Party brigade.

Voters refuse to let services be cut, and the refuse to allow taxes to rise. Until they are backed into a corner - or until a significant leader emerges - nothing is going to change.

What about the reform of the IMS?

imsreform.org

How about everyone starts at zero again? Winner USA Loser China

 

[AKUMATOTENSHI]

Quote from Kassz007:

All a technical debt default would do is serve to piss off USA's creditors. I don't know about you, but if I owe a bank a lot of money, I wouldn't start making late payments just to "prove a point".

On the other hand, the USA clearly has a debt problem and has for a long time. To this point, nothing has been done about it. Perhaps this is what is needed to finally get some action?

I find it extremely sad and disgusting that USA politicians cannot find any middle ground on this debt issue, and need to resort to default just to get action. They are all Americans, you'd think somebody somewhere would be able to work together to avoid default, and avoid increasing the debt load.

I had a micro situation similar to this one. The party that owed me, had money but wanted to play a game and see if a payment plan could be reached. I stuck to my guns and low and behold the money came out. Certain people like to use a debt or a payment to another party as a bargaining chip in negoiations. It sets a precidence and any future dealings with these type of individuals will be marred forever. Trust and confidence is lost for eternity. Messing around like this will cause the Chinese to come in take over the show. I don't think the Republicans or Democrats wants this. The debt will be paid one way or another.The freshman congress is doing nothing more than stiring up the pot for 2012. A political win will prove to be a phyrric victory in the long run.

Akuma

 

[nitro]

Obama: 'We're Making Progress' on Debt Compromise

http://www.cnbc.com/id/43796738

 

[murray t turtle]

Quote from dewton:

I've said it before and i'll say it again...

THE US GOVERNMENT DOES NOT NEED TO GO INTO DEBT TO FUND ITSELF BECAUSE IT HAS POWER GIVEN BY THE CONSTITUTION TO ..... MONEY!!!!!!!!

Yes the founders of this nation intended ....

!!!

Is anyone listening!?

================
Good points, Mr Dew, yes;
however article 1 section 10, US Constitution ''no state shall make anything but silver & gold coin tender for debts'' So it sounds like Congress is trying to violate the Spirit of that law....

Also Congress should actually read what is written on Federal Reserve notes;
''this note legal tender for all debts, public & private''..........................signed[official signature]...Treasurer of United States