Posted on 01/01/2013 12:58:14 PM PST by fooman
The Fed repays to the Treasury whatever interest is earned on its bonds. So, borrowing -- from the government's point of view -- becomes free! It's every despot's dream.
Of course, the drop in the dollar's value as a result of all that money-printing is paid by us when we try to exchange those dollars for actual goods.
Cantor will be against it before he is for it. You’re absolutely right; typical political posturing.
My question is a what point does world lose confidence in our treasuries.
After years of multi-hundred-billion-dollar money-printing by the Fed with no negative consequences so far, many people have come to believe that this method of financing our debt can go on indefinitely.
But we know from history that that isn’t the case, and that severe problems will occur if Congress passes over-the-cliff deals like Obama’s.
There are organizations whose job it is to warn investors about governments that refuse to stop profligate spending — the bond-rating agencies like Standard & Poor’s, etc.
If Obama’s budget deal is approved, with its minimal spending cuts that would assure trillion-dollar budget deficits ad infinitum, the rating agencies would be as blameworthy as our Congress if they didn’t respond by sending out alarm bells to warn investors about our increasingly risky bonds.
But will the bond agencies do their job? Unless they lower U.S. bond ratings after Obama’s deal is approved, we will know that they will have abandoned their responsibilities.
The establishment knows Boehner is done and, to avoid a real conservative from taking over as speaker, Cantor is being given the green light to oppose the bill in order to win conservative support. Cantor will be the next (establishment) speaker of thew house and conservatives will cheer thinking they are actually getting change.
Really....look at the Senate vote....hardly along party lines.
I guess the 64 Trillion dollar question is when does the music stop? Japan is at 190% of GDP because of a captive debt market (postal savings system). The government could require that we all put treasuries in our 401Ks for instance.
Cantor will be the next (establishment) speaker of thew house and conservatives will cheer thinking they are actually getting change.
Likely scenario. Note all the up and coming guys like Rubio and Ryan are hiding under their desks. Nobody has a stomach for this fight in the beltway GOP.
I called Cantor’s office during the 0baminationCare debate. Eventually, I realized that the young person I was talking to was actually listening, so I laid out a trial sentence about the corruption in DC. The response I got back specifically said, in a very depressed tone, “Tell me about it.”
Those poor kids—interns learning about the level of effete, Byzantine corruption, up close and personal. I’d be angry, were I in their shoes.
So, Cantor? No. I vote West. Give me JUSTICE.
Really....look at the Senate vote....hardly along party lines.
The deal is agreed. All we are seeing is posturing. So you really can’t read anything into individual votes.
First thing they should do is take out the “expanded earned income tax credit, child tax credit and college tax credit — extended for five years”.
I didn’t know we had expanded earned income credits in 2009 — enough already.
Cut unemployment benefit extensions to 2 months. They can take it up again during the debt talks.
The House has to vote on it. They can pass a different bill and force further negotiations. In fact, they should.
The dims had nothing... we owned the House, Senate and White House... they attacked Bush over Iraq and both destroyed the man’s reputation and his presidency. They were relentless and united. They controlled the debate and shaped the arguments and we must learn to do the same.
LLS
My favorite part of ZH post: “Retiring Rep. Steve LaTourette of Ohio asked House Republicans why the House would “heed the votes of sleep deprived octogenarians,” according to a source in the meeting.”
"We're building a consensus that we have to address spending," he said. "The president won his election; I also won my election.”
The GOP retained control of the House. It won. And if they are afraid to use that power and control, they deserve to be defeated in 2014.
Welcome... you took the correct colored pill.
LLS
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