Best of the Week
Most Popular
1.SNP Offers Labour Deadly Death Embrace Alliance, Holding England to Ransom, Destroy UK From Within - Nadeem_Walayat
2.Gold And Silver – Most Widely Used Currency In Western World? Stupidity - Michael_Noonan
3.Election Forecast 2015 - Coalition Economic Recovery vs Labour Collapse - Nadeem_Walayat
4.Election Forecast 2015 - Debates Boost Labour Into Opinion Polls Seats Lead - Nadeem_Walayat
5.Why are Interest Rates So Low? Ben Bernanke, Confused as Ever, Starts His Own Blog to Prove It - Mike_Shedlock
6.Leaders Debate Election 2015 - Natalie Bennett Green Party Convincing Anti-Austerity More Debt Argument - Nadeem_Walayat
7.Labour Economic Collapse vs Coalition Recovery - UK Election Forecast 2015 - Video - Nadeem_Walayat
8.China’s Stock Market Mania; How High can Red-chips Fly? - Gary_Dorsch
9.Gold and Misery, Strange Bedfellows - 31st Mar 15 - Dan_Norcini
10.Ed Miliband Debate Election 2015 Analysis - Labour Spending, Debt and Economic Collapse - Nadeem_Walayat
Last 5 days
Stock Market Waiting for Clarity - 5th May 15
Mice, Mazes & Investor Perception Management - 5th May 15
Conservatives Nightmare of Labour - Lib Dem Minority Government - Election Forecast 2015 - 5th May 15
Gold Long-term Outlook for Massive Parabolic Run to $5,000 - 4th May 15
Silver Bear Market Downside Momentum Easing - 4th May 15
Silver and NASDAQ – Long, Medium and Short Trends - 4th May 15
Let's Make Silver Shine Even Brighter Than Gold - 4th May 15
Six Silver Questions and Perspectives - 4th May 15
Stock Market Last Hurrah? - 4th May 15 - Andre_Gratian
Stocks – Bulls, Bears, And Pigs : Which Are You? - 4th May 15
The Energy Complex: Very Interesting Chartology - 4th May 15
U.S. Long Bond, an Historic Trading Opportunity? - 4th May 15
This Financial “Seismograph” Signals A Monetary Earthquake - 4th May 15
Nate Silver UK General Election Forecast 2015 as Wrong as 2010? - 4th May 15
U.S. GDP Sucking Spoilt Milk From A Bloated Dead Sow - 3rd May 15
Stocks, Gold and Oil Markets Chopsville - 3rd May 15
UK Election 2015 Forecast - The Most Probable Outcome is... - 3rd May 15
Kate Gives Birth to Coalition Government - 2nd May 15
Stock Market Correction Time? - 2nd May 15
Gold And Silver - Thieving Bankers Operate In Open; Public Have Eyes Wide Shut - 2nd May 15
U.S.A. Caught In Enormous Policy Vise - ZIRP & QE Destructive Influence - 2nd May 15
Crude Oil Price Bear Market Is Over - 2nd May 15
Gold and Silver Bear Squeeze Comes and Goes - 2nd May 15
UK Election Forecast 2015 - Who Will Win? - 1st May 15
Gold Developments Say New Mine Supply Is Peaking - 1st May 15
Emerging Mexican Silver - 1st May 15
Investigating The U.S. GDP Deflator: Wildly Differing Results Depending on Your Choice - 1st May 15
JP Morgan Cornering Silver Bullion Market? - 1st May 15
Baltimore Riots Whose Fault? - 1st May 15
Monetary And Economic Insights From Incrementum’s Advisory Board - 1st May 15
Your Best Stock Investment in the "Cloud" Is Right Here - 1st May 15
Stock Market Kondratieff Waves and the Greater Depression 2013- 2020 update - 1st May 15
How One Chart Is Changing My Outlook on Crude Oil Prices - 1st May 15
The Real Reason Why Obama Wants to Lift Sanctions on Iran - 30th Apr 15
Gold and the New U.S. and UK Recession - ZIRP to Continue - 30th Apr 15
Uranium Price Is About to Rocket - 30th Apr 15
Immigration Crisis Drives a Deep Wedge Between E.U. States - 30th Apr 15
Labour Leads in Nick Clegg's Sheffield Hallam Seat, Latest Ashcroft Opinion Poll - 30th Apr 15
Is the Fed about to Ignite the Stock Market Sell in May and Go Away Trade? - 30th Apr 15
Bill Gross on Pimco Hiring Bernanke and Fed Interest Rate Hike 2015 - 30th Apr 15
The European Stock Markets Trend Is Up. We're In. Are You? - 29th Apr 15
Putin: Czar Of Natural Gas, Crude Oil, Uranium & GOLD - 29th Apr 15
BEA Reports Weak U.S. 1st Quarter 2015 GDP Growth at 0.25% - 29th Apr 15
Why Labour Cannot Win Sheffield Hallam and other Lib-Dem / Conservative Key Marginal Seats - 29th Apr 15

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

The War on Cash!

The Debt Ceiling Reality Show Must Go On

Interest-Rates / US Debt Jul 14, 2011 - 04:45 AM GMT

By: James_Quinn

Interest-Rates

Best Financial Markets Analysis ArticleThe Debt Ceiling Reality Show is winding down to its dramatic conclusion on August 2. I think Fox should capitalize on the drama by gathering the American Idol judges to vote on the best performance by a political hack. We can have Ryan Seacrest announce on August 1 at 11:55 pm that the winner is – THE WALL STREET MONIED INTERESTS.


The latest round of kabuki theatre performed by the corrupt lying thieves in Washington DC is being played out every night on the MSM. The volume of misinformation, lies, exaggerations, posturing, and propaganda is staggering. These vile excuses for leaders know that 80% of the American population wouldn’t know the difference between a debt ceiling and a drop ceiling. They use this ignorance to their advantage, as Obama warns that old people won’t get their social security checks and government drones won’t be paid. 

According to Gallup, Republicans and Independents don’t want the debt ceiling raised. The poll also indicates that at least one third of Americans don’t care. They are too outraged by the Casey Anthony verdict to focus on the economic future of our country.

I’ll let you in on a secret. The debt ceiling will be raised. Sorry to ruin the surprise, but this entire sordid episode has nothing to do with our dire economic situation. It is solely about the 2012 elections. Both parties are conducting overnight polling on which talking points are working best in convincing the sheeple that their party is less likely to be blamed. Posturing and polling are what passes for leadership in America. It is a disgusting display and will contribute to the ultimate collapse that is headed our way like a Japanese Bullet Train.

Here is a summary of where we stand according to the MSM and the political class in Washington DC:

  • The supposedly grand compromise that would have “cut” $4 trillion from future deficits fell apart last week. The Democarats wouldn’t “cut” entitlements and the Republicans wouldn’t “raise” taxes.
  • The latest proposal was down to $2 trillion of future “cuts”, but neither side would agree to what and when.
  • Now in the ultimate Washington kick the can move, Mitch “Turtle Face” McConnell has proposed that Obama increase the debt limit in three stages, while requiring him to propose offsetting spending cuts, offering a potential path out of the impasse. Harry Reid loves the idea. I’m sure that gives you a nice warm feeling, like piss running down your leg.

This “solution” cuts nothing. Neither party wants to get blamed for shutting down the government. The Republicans blinked first. Honor, truth, and reality based solutions are non-existent in Washington DC. Weasels can never be trusted around the chicken coop.

The humorous part of this whole disgusting episode is that the $2 trillion or $4 trillion of supposed cuts in spending were not cuts at all. They were nothing but lower increases in future spending. They didn’t cut the national debt. Neither party has come close to presenting a plan to cut the national debt. Mike Shedlock presented a comparison of Obama’s ten year budget versus Paul Ryan’s ten year budget back in April. Take a a gander:


  
Even using ridiculously optimistic assumptions like interest rates staying low, no new wars, ending existing wars, no recessions, and no new programs, both of the corrupt political parties show ongoing deficits of $500 billion to $1 trillion per year forever. Does that sound like cuts in spending? The proposed reductions in spending increases are like pissing in the Atlantic Ocean of debt.

And here is where the rubber meets the road. Both the Democrat and Republican budget plans insure economic collapse within the next ten years. Again, using ridiculously optimistic assumptions, our National Debt would rise from $14.3 trillion today to between $23 and $26 trillion in ten years. Does that sound like cuts in spending to you?

Luckily, we’ll never reach those levels. We will hit $20 trillion in debt by 2015. That is a lock. Total Federal government revenue today is $2.175 trillion. We spend approximately $1 trillion per year on our military related adventures, or 46% of our total revenue. If interest rates are 5% in 2015, we will spend $1 trillion on interest. If rates are 10%, we will spend $2 trillion on interest. 

Do you get the picture? An unsustainable trend will not be sustained. We have two choices. We can proactively address the problem or just wait for the collapse of our economic system. This debt ceiling reality show is all the proof I need. Our leaders will choose to wait. It won’t be long.

Since no one in Washington DC can be depended upon to do the right thing, the only solution is to pass a Balanced Budget Amendment to the Constitution. Special interests across the land would mobilize all their forces to fight this idea. Deficit spending of $1.5 trillion per year enriches bankers, bomb makers, the AARP, mega-corporations, chain stores, restaurants, insurance companies, drug makers, etc. They will fight for their right to suck the country dry.

No matter how you cut it, H.L. Mencken understood our form of governing:

 ”Democracy is the theory that the common people know what they want, and deserve to get it good and hard.”

Join me at www.TheBurningPlatform.com to discuss truth and the future of our country.

By James Quinn

quinnadvisors@comcast.net

James Quinn is a senior director of strategic planning for a major university. James has held financial positions with a retailer, homebuilder and university in his 22-year career. Those positions included treasurer, controller, and head of strategic planning. He is married with three boys and is writing these articles because he cares about their future. He earned a BS in accounting from Drexel University and an MBA from Villanova University. He is a certified public accountant and a certified cash manager.

These articles reflect the personal views of James Quinn. They do not necessarily represent the views of his employer, and are not sponsored or endorsed by his employer.

© 2011 Copyright James Quinn - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

James Quinn Archive

© 2005-2015 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Free Report - Financial Markets 2014