Debt Rattle February 27 2017

[Raúl Ilargi Meijer]

Wyland Stanley Indian guides and Nash auto at Covelo stables., Mendocino County CA 1925   • The World’s Most Radical Experiment in Monetary Polic
[See the full post at: Debt Rattle February 27 2017]

[rapier]

I’ve said it before. Based only on hunch. I believe that the debt ceiling will not be raised any time soon but the government will not be shut down. Instead the White House will simply tell the Treasury which bills to pay. This will be a constitutional crisis for in part the constitution says that the legislature has the power to spend and after all the money is appropriated. That is why Clinton shut down the government. He said any non payment was default. But then who is going to stop them? The money isn’t there to pay all bills. The legal fight could go on for months.

Then there is the political crisis. Music to the Trump administrations ears and those of its fans. Then too without a Treasury supply the money has to go somewhere. Can you say stocks.

Lastly the approximate 3% of GDP deficit spending carries will disappear. Can you say recession.

[Patricia]

I cannot see that the debt ceiling is a problem. It is only a problem because someone says it is. The ceiling has always always been raised. The real question is if that is the case why have one at all? The American currency is the world’s reserve currency and as it is a sovereign country it can print its own money. So what is the problem?

[E. Swanson]

Bannon’s thinking appears to have been heavily influenced by Neil Howe’s hypothesis that history exhibits a series of repeated patterns. Bannon’s documentary “Generation Zero” used this hypothesis as it’s story line and Howe was one of those who was “interviewed”. I watched the thing (1 and a half hours worth) and came away feeling that the movie was actually a cleverly crafted bit of propaganda. As I was born at the end of WW II, i experienced much of the Baby Boom generation of the 50’s and 60’s which was the focus of one of the “turnings” mentioned in the movie. But, was left with the feeling that there was much left out of the presentation, for example, the Cold War hysteria in which we were continually reminded that nuclear war was just around the corner, even as we enjoyed the post WW II boom years.

The movie got many parts of the time line wrong and did not mention the “loss” of China, Korea or the Cuban Missile Crisis. Then too, there was an attempt to claim that the antiwar protests and the Woodstock Sex/Drugs/Rock and Roll culture were examples of a me-first youth culture, whereas it became clear there was no connection between what became a massive war in Vietman and the security of the US. There were similar disconnects between the financial mess of the 2000’s and events, such as the repeal of the Glass-Steagall Act in a bill pushed thru by Republican Phil Gramm.

The Republicans in the movie, like Newt Gingrich, obviously didn’t want to tell people that the meltdown in 2008 was in large part all their fault. The release date (February 5, 2010) was just at the beginning of the 2010 mid-term election cycle, the result of which was a big gain for the Republicans. The movie was released by Citizens United, the same crew that filed the suit which killed campaign limits by corporations, who are now considered to be “people”. One wonders whether all the high finance people now working in Trump’s administration would agree that the financial system needs overhaul with stronger oversight, which the movie suggests is necessary…

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