Posted on 05/12/2023 2:06:35 PM PDT by MinorityRepublican
Jamie Dimon warned that a U.S. default would be “potentially catastrophic,” and pleaded with politicians to “please negotiate a deal” before the country breaches its borrowing cap in early June.
If the U.S. defaults on its debt, the JPMorgan CEO warned in a Thursday interview with Bloomberg TV, it would hit “contracts, collateral, clearing houses, and affect clients definitely around the world.”
Dimon expressed some hope that the U.S. would be able to negotiate a solution if markets begin to worry that a default might happen. "The closer you get to it, you will have panic" in terms of market volatility, he warned. And while “panic becomes something that’s not good,” he noted, “if it gets to that panic point, people have to react.”
Dimon revealed to Bloomberg that JPMorgan is convening a weekly “war room” to evaluate the effects of a U.S. default. He predicted that the group would start meeting more regularly if the standoff continues, moving to daily meetings by around May 21 and then to meeting three times a day if no solution is reached.
(Excerpt) Read more at finance.yahoo.com ...
If the public is on the hook when these companies fail, effectively they are Public Trusts, and it’s no different than Socialism.
dramaqueen. Remember when Obama spent tens of thousands of dollars erecting fences around Vietnam and WW2 memorials in DC during the last debt limit increase?
IIRC, we defaulted under Obama...don’t think it was very long...
We didn't default. The federal government shutdown. Bur it led to the sequester. Which lasted only a year. But it was something.
By law and the 14th amendment US debts have the highest priority and will be paid. Something else won’t be.
Default isn’t possible. Unless someone violates the law.
A Democrat run government perhaps?
What does meeting three times a day do? I’ve run meetings for thirty years, Your need an agenda and a goal or you are simply wasting peoples time.
Hey, Jaime! Please stop manipulating the silver market so those of us who have properly prepared for the default can enjoy it in peace. Thank you - Mr. Jeeves :)
The debt limit applies to the issued amount, not the total amount outstanding (which will tend to rise above the debt limit amount because of interest).
It is possible for the federal government to default.
Default in practice means a wait for the government to pay off on a matured security. The next estimated tax due date is July 15th I believe. This means some debt holder might have to wait up to an extra 45 days to get his federal debt instrument paid off.
This isn’t a surprise, I imagine most if not all of the big banks are doing something similar. I know the top 10 bank I’m at is.
The federal government can make borrowing easier for itself by slashing the FDIC insurance limit.
If the FDIC was to lower its maximum coverage to $10,000 per person per 12 month period, people would snap up new federal debt even after default.
Here's what will happen. Joe Biden is not going to back down. 5 Republicans in the House will make a deal with the Democrats. Then it's business as usual.
I have lived through at least 2 or 3 of these including the one during Clintons term when he fucked around with Monica Lewinsky. Each and every time, NOTHING HAPPENED, except that federal employees eventually got paid for getting an extended vacation.
Mr. Banker, the federal government just defaulted.
So what, Mr. Customer?
Mr. Banker, I want 8% on my money.
And I want to get paid as much as Jamie Damon. The bank is in no position to pay 8% to depositors and therefore it won’t. Biden is going to have to accept the McCarthy plan (because this time the Republicans are standing firm), which means far less demand for borrowed money. Lock in our CD rates while you can.
The only way demand for borrowed money will increase is if McCarthy gives into Biden.
“5 Republicans in the House will make a deal with the Democrats.”
Vern Buchanan is as wobbly as they come. God forbid his car dealerships should lose car sales.
His heirs will find out the truly high cost of giving into Communists.
Elizabeth Warren and friends will ‘scalp’ his estate.
The next 30 days is when the Republicans must stop Democrats from buying over 50% of the voters.
Democrats must not be permitted to buy the 2024 election.
“This is preeminently the time to speak the truth, the whole truth, frankly and boldly. Nor need we shrink from honestly facing conditions in our country today. This great Nation will endure as it has endured, will revive and will prosper. So, first of all, let me assert my firm belief that the only thing we have to fear is fear itself—nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance. In every dark hour of our national life a leadership of frankness and vigor has met with that understanding and support of the people themselves which is essential to victory. I am convinced that you will again give that support to leadership in these critical days.”
https://historymatters.gmu.edu/d/5057/
President Franklin Delano Roosevelt in 1933
The House Republicans have a bad hand. Sometimes you have no choice but to fold. Joe Biden is willing to get us into default and blame the Republicans. If we end up in a major recession, so be it.
“The House Republicans have a bad hand.”
It’s the last hand they can play.
If they fold, everybody will lose.
I say burn it to the ground.
It’s a zero sum game for Joe Biden and the Democrats. We do not win in this scenario. But 2024 is coming up soon so there’s that. If inflation continues to stay sky high, that may persuade the American people to stop supporting the Biden Administration.
“Default, default, default” is all I hear...there will be no “default”, annual receipts for the Feds are around $5 trillion ($1.75 trillion left after “mandatory spending”) and the annual interest on the debt is about $929 billion. Bond holders (treasury notes/bills) holders likely would get paid first. As far as other government spending, cuts would be in order.
Simple to fix...pass a balanced budget (including debt interest payments) and there is no need to increase the debt limit.
https://fred.stlouisfed.org/series/FGRECPT
https://fred.stlouisfed.org/series/NA000308Q
https://www.cbsnews.com/news/debt-ceiling-debacle-who-gets-paid-first/
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