Jack Lew’s Debt Ceiling Limit Kabuki Theatre

Spend and they will borrow or print money to fund it.  The debt ceiling limit currently is $18.1 trillion.  This number is 101% of the Government over-estimated GDP.  If you add in the $7 trillion of taxpayer guaranteed Fannie Mae and Freddie Mac mortgage debt, the true directly funded level of Government debt is about $25 trillion, or 138% of the overestimated GDP.

The Treasury hit the debt ceiling limit earlier this spring.  Since then Jack Lew has been borrowing cash from various “pools” of dedicated Government spending accounts, like Social Security and the Federal Employee Pension Plan (but not the Congressional Pension Plan, of course).  Lew was on CNBC a couple days explaining that his “smoke and mirror” tactics are now exhausted and if the debt ceiling is not raised, the Government will default on obligations.

But this is nothing more than a production of political Kabuki theatre.  The Senate I’m sure will rubber stamp any spending and debt plan that Obama sticks under its nose.  But the House is controlled by Republicans with an agenda – not to force spending cuts and actually reduce the rate at which the taxpayers accumulate more debt – to use this crisis in order to force the passage of their fanatical military, political and moral legislation du jour.

The truth is that ultimately a new debt ceiling limit will be established and the Government will continue printing and borrowing printed money from other Governments in order to continue on its historically unprecedented rate of growth in spending.  Mind you, this is spending mostly on programs which are used to transfer wealth from the middle class to the big corporations and wealthy elitists.

The fact that Paul Ryan is willing to step up and assume the Speaker of House role if certain of his pre-conditions are met tells me that the behind the scenes politicking  and deal-making has already been largely accomplished.  Now it’s simply of matter of the Government utilizing  the media to apply a heavy dose of scare-mongering so that the sheeple in this country can lose a little sleep before getting the relief of an eventual agreement which should take the new debt limit over $19 trillion.   Rest assured that this “crisis” will pass and no one will miss a swipe on their EBT card and the Pentagon can continue funding its terrorist activities around the globe.

16 thoughts on “Jack Lew’s Debt Ceiling Limit Kabuki Theatre

  1. Theatre of the Absurd.

    def: ceiling; (noun) the highest limit that something can reach.

    The debt (so-called) “ceiling” started life as a one floor bungalow.
    As each debt ceiling was raised, it became a multi story building.
    It is now a high rise skyscraper that wobbles in the slightest of financial winds.
    Things that are top heavy fall over. This is a hard law of nature. Question of when.

  2. Dave I have always been wondering about a couple of things.
    How many floors do you have in the Eccles building.
    Do they have “speciallly manufactured stairs” so the old and disabled people can get access to the windows for the final jump?
    I think you will se “Grandma Bagholder” in the windows quite soon.

      1. Dave you have to excuse me for my evil humour.
        I often visit England and the next time I will ask Allistair Macleoud to organize a course in politness and decent behaviour!
        Just let me know if you want me to “soften up”

  3. One need only look to Zimbabwe (have they figured out what comes after 100 trillion for their next high denomination bill?) to see where this Ponzi scheme is headed.

  4. As a matter of economic theory how high can this thing still go? If 30 years ago you had said the debt ceiling will reach $30 trillion most people who understood these things would have shook their heads and said “no way. ”

    $25 trillion? $50 trillion? $100 trillion? It boggles the mind. How much more can they print? Better go and buy yourselves a wheelbarrow so you can pile it up with $ notes to take to the bakery to buy bread. But watch out, because by then you wheelbarrow will be worth a lot more than your mountain of cash..

  5. the real trick will be to see who buys the new debt that gets issued when the debt ceiling gets raised. Again.

    they have to “fund” the 9 months of being held under the debt ceiling to pay back wherever they got the money from and then fund the rest of the year. And then have a debt ceiling high enough to get past the election.

    Then we have the problem that tax revenues are declining.

    back to who buys: China and Russia and a few others are sellers. Japan has its own problems. So just who is big enough now to buy the new issues, the rolled issues and what China, Russia , Brazil and Opec countries are selling. I wonder how much the Saudis will have to sell to deal with their problems. Our pension plans will have little in the way of assets left to be forced buy treasuries-besides they would have to sell toxic stuff which the Fed will figure out fast that it does not want the market to know the real value of that crap. Or perhaps it will not matter by then.

    The best days to be US Treasury Secretary look like they are behind us. Besides, what banks will a treasury secretary go back to when the banks break down.

    nope–Rubin and Paulsen got the best all inclusive packages.

    does anybody see any way its possible to get out of this problem without some major hurt?

  6. I haven’t seen much discussion of these 2 items which came out same day (yesterday) elsewhere, and wanted to throw them into the mix:

    China calls for new global currency to replace US Dollar
    http://abcnews.go.com/Business/story?id=7168919&page=1

    Chinese yuan on track to be included in IMF basket
    http://www.reuters.com/article/2015/10/20/global-forex-renminbi-idUKL8N12K29X20151020

    Apart from this, there was a Financial Times paid link which seemed to claim, China has dumped a total of half trillion USD treasuries in the 1st 9 months of this year. And following, which says everybody & their grandma are dumping US treasuries, but it’s no big deal. Nothing will be affected, because “We so fine!”

    http://money.cnn.com/2015/10/14/news/economy/us-treasury-debt-selloff-2015/index.html

      1. Hey I think the China ABCNews article is dated – it references “Federal Reserve Chairman Ben Bernanke” and “Treasury Secretary Timothy Geithner”

        1. Oops, sorry; you’re correct. I should’ve caught that. There isn’t even a date posted for that link. I have no idea why there wasn’t a big hallabaloo about it when that happened!? Or maybe an agreement was made behind the curtain to send all gold to China when this happened in order to shut them up & buy more for a global digital currency framework.

  7. BITGOLD
    A Personal & Legal Gold Standard OUTSIDE THE BANKING SYSTEM BUT INSIDE THE REGULATORY SYSTEM
    Jay Taylor interviews Roy Sebag of GoldMoney .. Sebag explains why GoldMoney is potentially superior to PayPal & how you can use the BitGold payment platform to enhance your wealth .. 40 minutes

  8. Who will buy the Treasuries ? The Fed will buy some. The primary dealers will buy. They prop up the stock market. Companies like Apple and Amazon will park some of their profits into US Treasuries. Hide it off book and away from any GAAP rules. And the game of hide the weenie will continue. And we will continue to become poorer and poorer.

Leave a Reply

Your email address will not be published. Required fields are marked *

Time limit is exhausted. Please reload CAPTCHA.