Skip to comments.Bernanke delivers blunt warning on U.S. debt
Posted on 02/26/2010 11:04:23 AM PST by prairiebreeze
With uncharacteristic bluntness, Federal Reserve Chairman Ben S. Bernanke warned Congress on Wednesday that the United States could soon face a debt crisis like the one in Greece, and declared that the central bank will not help legislators by printing money to pay for the ballooning federal debt.
Recent events in Europe, where Greece and other nations with large, unsustainable deficits like the United States are having increasing trouble selling their debt to investors, show that the U.S. is vulnerable to a sudden reversal of fortunes that would force taxpayers to pay higher interest rates on the debt, Mr. Bernanke said.
"It's not something that is 10 years away. It affects the markets currently," he told the House Financial Services Committee. "It is possible that bond markets will become worried about the sustainability [of yearly deficits over $1 trillion], and we may find ourselves facing higher interest rates even today."
"We're not going to monetize the debt," Mr. Bernanke declared flatly, stressing that Congress needs to start making plans to bring down the deficit to avoid such a dangerous dilemma for the Fed.
(Excerpt) Read more at washingtontimes.com ...
Here’s the excuse for the coming MASSIVE tax hikes.
Well, DUH! The morons in the White house and Congress need the Fed to tell them they are ruining the dollar? Sheesh.
UM THE REPUBLICANS TOLD YOU SO AND YOU STUPID LIBS DID NOT LISTEN....PING!!!!
Going galt here. It is very difficult to tax those that don’t earn and don’t spend.
We can’t all do that, living in a cabin are you?
“Toxic Exploding Freddie Mortgage Factory To Close”
Karl Denninger, 26 Feb 2010
We really do have radicals in our WH, who would like nothing better than to bring down the USA.
"You look supicously like a turnip and I believe you DO have blood in you. Pay UP!"
Geithner and Obama like to stick their fingers in their ears and sing-song “La-la-la-la...”
I bought a ~13 acre farm with a new 1,000 sq ft home. It is an entire finger of a plateau aproximately 60 feet over the valley we overlook.
IN the Seattle area I owned my own home for 20 years and lost it in a divorce 12 years ago. I’ve rented ever since and almost bought a few years ago. I thought this runup was nuts and refused to be last in on a pyramid. Also, renting gave me the ability to move at the drop of a hat. I just moved from a 5 bedroom house that was appraised at $525k but I paid $1,600 a month. I now live in a $1,050 condo across the street from my corporate office. That plus the payments on the place in Kentucky is a hair less than my rent payment was in the house, and THAT was cheap.
We leased the farm back to the original owner and we bought two calves, one each, late last winter. We slaughtered them in November and now have about 480 lbs of meat that had a total out of pocket cost of $420. The previous owner canned 75 jars of potatoes last winter that were grown on the land, beyond the other stuff they grew.
The land has a natural well.
If things collapse here, it is waiting for us. It is also where we vacation now. We have the ability to easily fly there whenever we need. Getting the time off is the only challenge. We have what is left of our five bedrooms of stuff (mostly bicycles, music equipment, records and vintage hi-fi stuff and my wife’s collectibles) in storage and plan to drive a U-haul truck there this spring. We’ll fly back and wait for the time we move there permanently, when we’ll drive there in my Scion xB. We plan to move this summer and I plan to telecommute.
But the key was that we did not own a home chaining us to a particular area.
Oh, and the farm is off a road off a road off a road off a highway. The roads around us are what Seattle bike trails aspire to be and we were on the road talking to a neighbor last fall for THREE hours and not a single car drove by. And there are STILL two wall marts and Lowe’s within 13 minutes. It cost us $98k and the US government gave us $8k back. :)
Bernanke, c’mon. Why get bogged down in the numbers... jeez...
>>”You look supicously like a turnip and I believe you DO have blood in you. Pay UP!”
I’m finding that the easy part to give up is spending money. The hard part to give up is earning money. ;)
And with the exception of food, so many of our durable goods are spent on craigslist and garage sales that they don’t count.
Good Job!!! You sound a lot like my brother. He too did a great job of managing his money and made some sharp moves; he too owns a farm and is quite self-sufficient.
In my opinion you should be quite proud of yourself! You made good, sound decisions and took responsibility (both good and bad) for your actions and are now reaping the benefits.
Contrast your actions to so many who acted foolishly, and now want the country to bail them out.
Wish there were more of You (and my brother).
Cut spending= political storm.
keep spending= higher interest rates= snuff recovery.
print money = dictatorship
Since when did trying to borrow and spend your way out of debt ever work?
You, Mr. Bernanke have facilitated the economic destruction of America. No one buys your whining about the obvious now.
Trading paper money for real land. You..you..must be some sort of ...of crank! /sac
Twenty minutes from shopping in a medium sized city but standing up on our house seat you'd think you were 100 miles out in the boonies.
Just need to get a small modular home up there this summer and we are good to go.
Avoid unnecessary purchases. Become more self-supporting every month. Start a hobby of learning to make something useful. Welcome the big default and consequently small government. They’re trapped.
They haven’t monetized the debt, dollar-for-asset. They’ve only created funny financial instruments. Bernanke said that they won’t monetize the debt, because it wouldn’t work as it has in the past. We no longer have a manufacturing base to support that move with revenues. If they monetized the debt, their money would be worthless. Your local, yocal Minnie Pearl government employees wouldn’t be able to buy anything with their federal funds. They’ll just have to go away mad, because the revenues won’t be there for paying them.
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