July 22 : We enter the danger zone

Wonkbook: Is July 22nd the new debt-ceiling day?

You've probably heard that Aug. 2nd is the drop-dead date for a debt-ceiling deal. Nuh-uh, the White House tells Damian Paletta. It's actually July 22nd. Writing and passing the legislation takes some time, as does working the money through the Treasury Department. This can't be left until the last moment.

1) The administration is setting July 22 as the debt deal due-date, reports Damian Paletta: "The Obama administration believes congressional leaders must agree to a deficit-reduction deal by July 22 in order to raise the government's borrowing limit in time to avoid a default in early August, according to Democratic officials with knowledge of the negotiations. The government needs a week or two to write and pass the necessary legislation and take the steps necessary to avoid missing a payment. 'We're down to the wire,' one official said.

Well well well... it's gonna be fun to watch the puppets giving us a good show for our money...

And since House republicans are on vacation during the week-end, that would leave July 25 at the earliest for a deal if no deal is done tomorrow.

The White House gave the July 22 date as fear mongering IMO... since if they really want to pass a bill to screw people, they can do it real fast, can even even pass both the house and senate in the same day, if TARP passage is any indication.

Hopefully some senators will filibuster it if there's no real deal. (as Rand Paul hinted he would do) Default will be the only thing to force a REAL deal to be done.

Relaxe.... Gold is up,Stock market is up. No one in power will tell you WHY or HOW. Your on a need to know basis.

At what point DON"T you think interests rate have to go up a little? Were giving away our debt for free.

The food lines are already out there. It's just on an electronic card now and you can't see it.

If you think China or any other Country isn't positioning for Global Control along with the U.S. your mistaken.

Change whether good or bad is inevitable. Whether U.S.,China,India, Germany, Brazil ,Russia helps the big power brokers keep floating money,it's going to happen even if you don't like it.

If you think Hillary Clinton is flying around the world to promote goodwill for the interest of the United States,your not up to speed.

She's on her own U.S. Government Jet,cutting deals,and staying away as far as possible from Obama as she cuts new global pie interests.

Plus, she gets to sneer at Nancy Pelosi as a 2 bit politican.

As long as she can keep Bill sobor when He's on camera,she could give a rats ass what he does.

Let's play poker.

On topic, this whole default crap is smoke and mirrors for the next election. So they extend it again.

Big Whupp.

If we lose our credit rating? WTF is an extra trillion in interest in 10 years? Are you serious? OK cut it down by THREE trillion,THAT will show Americans we mean business.

It's so rediculous.

Believe me, Republicans smell the recontrol of the White House.

Period.
They just have to cut some more deals with Tea partiers and Demo's and see who calls in the favors and markers after the election.

Even Ratatoullie the cooking mouse is jumping out of the White house right now.

Or was he a rat like the rest of them?

reply to post by Vitchilo


... Hermmm ..

Let's see. The legislation is already written, somewhere. Just like Health Care Reform and the Patriot Act .. these massive volumes are thrown together practically instantly as soon as a "deal" is made. Essentially all they do is take the scraps of what is "agreed upon", toss in some BS, and then everyone has a free forall adding Pork, and wala .. a "Bill".

July 22nd? August 2nd? Does it matter?

The largest, by far, purchaser of US debt has been the Federal Reserve through "QE" .. when Reserve debts mature they are "destroyed", more often than not the profit, ie, interest, is turned into the Treasury. The Treasury then adds it to it's own accounts and funds it's operations, the Principle is in theory destroyed never to be seen again until the next time the Fed needs to create a little inflation by buying massive quantities of debts.

In the event of a default, the Federal Reserve stands the chance to loose it's investment before anyone else. Since it dosen't actually make any money off it, why does it matter?

IMO, and hey, it's only my opinion .. the Government is making a massive show about debt simply for the reason to focus the World's attention on the possibility of a US default ... which is absolutely impossible. regardless of who is saying they will let it default, when the show wraps up the Gov will find a solution "in the knick of time!" and save the World from financial armagedon. Then both sides have fun making it a political advantage.

Meanwhile Europe is burning. They literally do have a chance at completely collapsing with very little that can be done to prevent it. While the USA took the lime light, Europe scrambled to save Greece and ultimately the rest of the PIIGS .. by puting strain on the USD because of these "talks" it prevented the collapse of the Euro and the European economy by creating a sitation where there is nowhere safe to run. If your holding USD or EUR you'r totally screwed as they made it appear the whole world's burning, not just Europe. Which would explain why those smart enough ran to Gold and Silver, which have exploded.

Just my thoughts.

Originally posted by Rockpuck


IMO, and hey, it's only my opinion .. the Government is making a massive show about debt simply for the reason to focus the World's attention on the possibility of a US default ... which is absolutely impossible. regardless of who is saying they will let it default, when the show wraps up the Gov will find a solution "in the knick of time!" and save the World from financial armagedon. Then both sides have fun making it a political advantage.

Meanwhile Europe is burning. They literally do have a chance at completely collapsing with very little that can be done to prevent it. While the USA took the lime light, Europe scrambled to save Greece and ultimately the rest of the PIIGS .. by puting strain on the USD b,,,,
.

Just my thoughts.

i tend to agree. i think a WhOLE lot of this grandstanding, even beyond the debt, i theater for the rest of the world, so they think were broke, and it wouldnt hurt if they all think we might be crazy and heavily armed.

Well the Titanic sunk in The Atlantic on April 14, 1912 - closer to the European continent than it did the US. So, maybe the Eurozone economies will sink before the US, on, eh, April 14, 2012 - the centenary of the sinking of the ship that can't sink!

reply to post by Rockpuck

Let's see. The legislation is already written, somewhere. Just like Health Care Reform and the Patriot Act .. these massive volumes are thrown together practically instantly as soon as a "deal" is made. Essentially all they do is take the scraps of what is "agreed upon", toss in some BS, and then everyone has a free forall adding Pork, and wala .. a "Bill".

Hahaha! I've always thought the same thing. Two thousand pages of health care reform with the blink of any eye. Either he's got superhumans working for him, or things were already in the works and the big show was for our benefit. This is no different.

Deja vu. Exactly four years ago it was also around July when ATS was abuzz with talks of economic collapse. And you all know what happened two months later.

Originally posted by eldard
Deja vu. Exactly four years ago it was also around July when ATS was abuzz with talks of economic collapse. And you all know what happened two months later.

It happened? Well it ALMOST happened...

Republican Kevin McCarthy Says No Debt Deal Likely Today, Or Over Weekend: Treasury Now Projected To Have -$15.5BN Cash Balance On August 15 $31BN Coupon Date

Well, it looks like there will be no debt ceiling hike enacted prior to August 2 at which point the money really does run out. From The Hill: "The No. 3 Republican in the House said Thursday night that he didn’t expect any surprises in the deficit debate over the weekend. “I do not see something springing this weekend,” Republican Whip Kevin McCarthy (Calif.) told conservative radio host Hugh Hewitt. McCarthy pooh-poohed reports that the White House and Republican leadership are closing fast on a deal on the budget deficit and raising the debt ceiling. “There is no deal,” McCarthy said

Now the reason why this is bad is because as Stone McCarthy calculates, "we expect Treasury to have less cash in early August than we thought previously." And here is where it gets very tricky since the money generating machinery won't be in place on time: "we now show Treasury with a negative cash balance of $15.5 billion on August 15, which implies that Treasury wouldn't have the resources to pay $30.6 billion in interest on that day."

Finally, if Congress hasn't increased the debt limit by August 2, Treasury Secretary Geithner would be on solid ground in extending the length of the Debt Issuance Suspension Period (DISP), which would allow Treasury to make further use of the CSRDF. Declaring that he expected the DISP to last another month, for instance, would provide Treasury immediately with another $6.0 billion in borrowing authority.

In sum, Treasury is going to start August with less cash than we thought previously. We still think Treasury could probably pay its obligations through August 15, but it's become a much closer call.

Default day could be August 15 then... and if not August 15, it'll be August 18 at most.

Boehner Tells GOP Lawmakers There Is No Deal On Debt Ceiling

No deal... for now. From Reuters: "Speaker of the U.S. House of Representatives John Boehner told fellow Republicans on Friday there's still no deal to avert a debt default, but that talks continue, a senior party member said. Boehner's message at a closed-door House Republican meeting was: "There's no deal, and we'll continue to work to get resolution to the problem," said Republican Congressman Tom Latham." They have less than 14 hours now.

Meh, they will hammer one out, and again, we will take it up the you know what like always and like it. Why, because us Americans are too stupid to realize anything else.

Latest :
John Boehner: 'No Deal' On Debt Ceiling, Democrats Have 'Done Nothing

Speaker John Boehner declared Friday that the House has "done its job" toward resolving the impasse over raising the government's debt limit and said it was time for the Senate to act.

"There is no deal. There is no agreement in private" with Democrats, Boehner told reporters at the Capitol as the Senate was voting on a bill pushed through the House by majority Republicans which is called "cut, cap and balance" in pursuit of an accommodation on raising the government's debt limit. The legislation was killed in the Democratic-dominated Senate on a procedural vote by a 51-46 margin.

I say they continue to pass the Cut Cap and Balance bill in the house till it passes the senate. Change the name of it every time the senate rejects it.

You REALLY have till August 14 to pass a real bill.... America won't default (for real) till August 15.

This new report on who owns our debt will surely PISS YOU OFF!

globalpublicsquare.blogs.cnn.com...

Notice Social Security .. the pension fund from this time 2 years ago has added an astounding 800+ billion dollars in Federal debts. With a negative interest rate?

!%! you very much Washington.

Clearly the "accounting tricks" being used to keep us afloat amount to one thing only: Loot Social Security.

Boehner's Complete "Dear Colleagues... In The End We Couldn't Connect" Letter

Just released from John Boehner, clarifying his position on why he has terminated all debt ceiling hike discussions with Obama.

No more talks with Obama, but talks with the senate.

Breaking: Boehner Walks Away From White House Debt Limit Negotiations

A week after Barack Obama stormed away from Republican negotiations on the debt ceiling, it is now Boehner's turn. Per Obama's live speech which is currently ongoing, John Boehner has broken away discussions with the president. Obama's response is to demand a meeting with Bohner, Pelosi and McConnell at 11 am tomorrow to explain to the president how it is possible that America will be in non-selective default in as little as ten days: "I want them here tomorrow at 11am...we have run out of time."

No you haven't run out of time. The ``real default`` date is August 15. You can still pass a bill in less than a day on August 14... of course if you do that, the markets are drop a few thousands points till then.

Update :

Following Obama's statement, Boehner will have his own press conference at 7:15 pm.

So real soon.

And something which is not really a surprise...


20 democrats support a balance budget... yet they all voted against the cut, cap and balanced budget bill...

Originally posted by Vitchilo
And something which is not really a surprise...


20 democrats support a balance budget... yet they all voted against the cut, cap and balanced budget bill...

That would only seem ironic or a contradiction if you believe that the 'cut, cap, and balance bill' was only about a balanced budget.

Bills are rarely what they claim to be.

Originally posted by incrediblelousminds

Originally posted by Vitchilo
And something which is not really a surprise...


20 democrats support a balance budget... yet they all voted against the cut, cap and balanced budget bill...

That would only seem ironic or a contradiction if you believe that the 'cut, cap, and balance bill' was only about a balanced budget.

Bills are rarely what they claim to be.

Well it's also about cutting the budget (half of the deficit starting next year)... capping the budget to 18% of GDP (by 2018) and a constitutional amendment to balance the budget.

reply to post by Vitchilo


And that's it? No riders, no pork, nothing else accept what is in the title?

I doubt it.

Have you read it?

Originally posted by incrediblelousminds
reply to post by Vitchilo

 

And that's it? No riders, no pork, nothing else accept what is in the title?

I doubt it.

Have you read it?

Actually there's no pork... no nothing. The bill
A little analysis I made...
The cut part :

Limits on discretionary spending :
Limited to 1.22 trillion, including a maximum of 126 billion for the war on terror.

2010 for example, had 1.37 trillion in discretionary spending.

Direct spending limits :
- Social security, medicare, veterans benefits and services and net interest on the debt are EXEMPT from any limit/balanced budget.
All the other direct spending is limited to 680.73 bilion.

Mandatory spending in 2010 : 2.17 trillion... if you remove all that is exempt, there's still 861 billion... So medicaid and unemployment/welfare are cut.

The ``cap`` part...

21.7% of GDP for 2013.
20.8% of GDP for 2014.
20.2% of GDP for 2015.
20.1% of GDP for 2016.
19.9% of GDP for 2017.
19.7% of GDP for 2018.
19.9% of GDP for 2019.
19.9% of GDP for 2020.
19.9% of GDP for 2021.

Of course, medicare, tricare, military pay, military retirement, social security, veterans and net interest on the debt are all exempt.

Balanced :

Raise the debt ceiling to 16.7 trillion, but not until a balanced budget amendment is transmitted to the states, and requires a 2/3 vote in house and senate before any tax increase is approved, requires every budget that total outlays not exceed total receipts.

I don't know if the balanced budget amendment have to be passed or just introduced... since the word ``transmitted`` is not very clear... the balanced budget amendment could be only given to states, the states refuse it, and the debt ceiling is raised anyway...

Debt Ceiling Deadline Might Be August 10, Not August 2: Report

For months, markets have been girding themselves against the possibility that the U.S. will reach the limits of its borrowing ability on August 2 and default on its debts. But researchers at Barclays Capital think the real deadline may not be until a week later.

In a note published Friday, the Barclays Interest Rates Research team wrote that “the date on which the Treasury will run out of cash to pay its obligations might not be August 2; it might be around August 10 instead.”

And as the Financial Times pointed out earlier this month, researchers at Nomura have already predicted that the Treasury won’t run out of funds until August 9.

I'm saying August 18.

Saturday debt-limit talks last less than an hour; grim faces on all sides, no sign of progress

One day after a partisan blowup, President Barack Obama met for less than an hour Saturday with congressional leaders in crisis talks aimed at averting a national financial default in just 10 days.

Good.

U.S. President Barack Obama and congressional leaders are "definitely not" considering a short-term debt limit increase in their weekend negotiations to break an impasse, House of Representatives Democratic leader Nancy Pelosi told reporters on Saturday

'Very real' risk of US rating drop as debt talks deadline looms

THE United States runs a "very real" risk of losing its top triple-A rating if nothing is done to reduce the ballooning deficit, says an official after debt talks collapsed.