According to the administration of Barack Obama, we are eight days away from the apocalypse. Unless the federal government agrees to a massive increase in its borrowing capacity, the sky will most assuredly fall.
Fire. Brimstone. Bowls outpouring. Bowel-shaking earthquakes.
Just this week, Obama said America was headed toward “economic chaos” and “a very deep recession” if the federal government didn’t immediately agree to take on more debt. This is ostensibly why Obama is refusing to negotiate (i.e. refusing to trade spending cuts for an increase in the debt limit) – even though his GOP “opponents” are basically surrendering on all fronts.
But is the sky really going to fall on October 17? Is the federal government really default?
Not according to one of the nation’s top credit-rating agencies.
Moody’s says in a new memo that “the government would continue to pay interest and principal on its debt even in the event that the debt limit is not raised, leaving its creditworthiness intact.”
Wait … what about all that “historic default” mumbo-jumbo?
“The debt limit restricts government expenditures to the amount of its incoming revenues; it does not prohibit the government from servicing its debt,” the memo continues. “There is no direct connection between the debt limit (actually the exhaustion of the Treasury’s extraordinary measures to raise funds) and a default.”
In other words if the government (gasp) found stuff to cut, it wouldn’t have to compromise the “full faith and credit of the United States” (to the extent people can still say that with a straight face).
In fact Moody’s contends the 2013 debt ceiling crisis is actually less serious than the 2011 debate … which spawned the infamous “debt dereliction deal,” a $2.4 trillion debt limit hike (which the government blew through in seventeen months) in exchange for the promise of $2.1 trillion in spending cuts over the coming ten years.
“The budget deficit was considerably larger in 2011 than it is currently, so the magnitude of the necessary spending cuts needed after 17 October is lower now than it was then,” the memo states.
Far be it from us to downplay the seriousness of the debt limit situation. In fact we’ve “up-played” it … while at the same time rebuking the “Republican” leadership for their proposed compromise.
But if October 17 comes and goes without a debt deal, it won’t mean a default … it would only mean government could spend no more than it took in.
Imagine that …
Will Folks keeps overtly racist writings on this site. The writings are attributed to fitsnews. This is a protest.
Balanced budgets are racist.
Does Will Folks ever engage readers in the comments section about what he wrote?
Occasionally, but what exactly is it that you deem “racist” on this site?
Do you think Will Folks would remove an article, or amend it? How much does he really “like people” ?
If Darla Moore read this post would she forward it to Nancy Mace?
Ask yourself why.
Does Willie Folks not understand how the GPS coordinates of Damascus are correlated with the proposed shipping terminal in Greer?
Nancy Mace, your fellow Cadets know about the “HURRICANE in the GULF of MEXICO”. Do you?
What do all those trains and trucks run on? Why doesn’t NANCY MACE or WILL FOLKS ask Lindsey Graham about “diesel”?
You can bet Smirks, Phillip Branton, Frank Pytel, Jim Lewis, and Shifty Henry can answer these questions.
Not for BS
How about if he is dead wrong?
About what Comic Book?
Hold your horses.
Internet Troll – A person whose sole purpose in life is to seek out people to argue with on the internet over extremely trivial issues. Such arguments can happen on blogs,
You can accuse Will of many things, a “bloviator,extrodinaire”, egotistical, arrogant, a fetishist, a “prevert” (one who is not quite a pervert), balding, obese overly indulgent in hyperbole and fixated on running Boeing down but racist? Hardly. Calling a spade a spade when talking about the President’s ridiculous policies and lack of leadership is not racism, it’s accuracy in (the new) media.
Calling a spade a spade….
*Jumps up and down. Points finger.*
Reminiscent of Nixon’s “Southern Strategy”!!!!
lol! I thought the same thing myself.
I was hoping his brain would explode…
It’s not accuracy what Will Folks wrote. I am not a troll. I am a reaction to what he wrote. He’s looking for reactions, no? New media means we the readers can confront the author of inaccuracies. He’s putting the poison out there, I’m here to stand against it and show he is wrong. This is not a trivial issue to the people he wants to belittle, and I would like to know exactly why he feels the need to target those people as well as be an accessory to help spreading lies about them with his writing.
“I am a reaction to what he wrote.”
Mr. Folks. Your Id is loose again.
He is wrong.
About what Comic Book? You can call Will a “flaming kabuki dancer” for all I care but you can’t just throw the accusation out there and not back it up. If you can’t back up your BS, you’re the living embodiment of – a troll.
Sorry to you, he threw his B.S. out there, so why do you think I can’t I do the same? It’s a reaction.
So is poopin.
You’re a reaction, did somebody poop?
Yeah, Will Folks. I’m going to clean up his mess.
Barkin up the wrong tree Mr. Avenger, turn your mask around, you’ve got it on backwards.
— or else it’s Miley Cyrus’ panties…
Raise the debt limit, keep fighting O-care via the continuing resolution.
Frack that. #SHUTERDOWN #OBAMAFAILSAGAIN
Obligatory Ghostbusters clip.
At first he was POTUS who voiced concern and people listened
Then he became a Democrat who put his Party above people’s need
Next he was a Politician who chose politics over people’s need
Overnight he became the boy who cried wolf
Now, outside of his wife, he is just another talking head and nobody listens
You forgot when he became a traitor by supplying AlQueda with weapons.
““full faith and credit of the United States” (to the extent people can
still say that with a straight face).”
Exactly,there’s a total cognitive dissonance to the fact that every month
there’s an $85 billion dollar attack on the “full faith and
credit of the United State”…lol
We’ve been in ongoing default for 42 years+, the only difference is that
the proverbial printing press is in the short term less painful default at
the detriment of the long term.(extended misery a la Japan style)
It’s kind of strange though this time around, it’s like the establish
players are starting to worry and looking to blame “extremists”(of
course, printing money to pay the bills for 42 years is in no way
When has the decision ever been made long term to not raise the debt
The answer: Never
So from that perspective, the tin foil hat wearers really are those
claiming something other than a debt ceiling raise will occur.
“The shutdown won’t hurt anyone. The Republicans should totally do it and demand an end to Obamacare.”
“Holy shit, the shutdown closed all these things I liked! All these people I like aren’t getting paid! Quick, pass this and that to un-shut it down! Damn it, this is the Democrats’ fault! Right everyone? Hello? America?”
“The default won’t hurt anyone. The Republicans should totally do it and demand an end to Obamacare.”
The numbnuts can’t get it together to pay for death benefits for the military, and we’re expected to believe they are going to prioritize spending correctly – the newest gop to play down default. From what I’ve read there’s no computer system set up to do that anyway. And if they aren’t able to whip up a working website for obamacare after 3 years, well….
As I have shared previously, business and finance is a “bridge too far” for “The Founding Editor.”
Fitch and S&P aren’t singing all will be well if the dumbasses in congress do nothing.
Fitch said if the debt ceiling isn’t raised in a “timely manner,” meaning several days prior to when the U.S. Treasury says it will have exhausted extraordinary measures and cash, it will launch “a formal review of the AAA rating and likely lead to a downgrade.” Some on Wall Street believe the firm could cut even if a deal is reached in Congress.
S&P said it would not anticipate a change to the rating if the current impasse is short-lived.
“This sort of brinkmanship is the dominant reason the rating is no longer AAA,” S&P said on September 30.
BTW, anyone know if Mrs. Ted Cruz who works for Goldman Sachs thinks this debt ceiling showdown isn’t a big deal? It appears her top boss isn’t OK with the quackery coming from the right.
“Fitch said if the debt ceiling isn’t raised in a “timely manner,” meaning several days prior to when the U.S. Treasury says it will have exhausted extraordinary measures and cash, it will launch “a formal review of the AAA rating and likely lead to a downgrade.”
Well, Fitch just better watch itself, they are just one Federal lawsuit away from regretting that statement.
I wouldn’t fret yourself too much, the history of “timely” debt ceiling raises is overwhelmingly positive.
Holler at me when the rating becomes CCC. Wouldn’t want hit aaa.
Looks like Moody’s has a different opinion:
“Moody’s says in the memo dated Oct. 7.
” We believe the government would continue to pay interest and principal on its debt even in the event that the debt limit is not raised, leaving its creditworthiness intact,” the memo says. “The debt limit restricts government expenditures to the amount of its incoming revenues; it does not prohibit the government from servicing its debt. There is no direct connection between the debt limit (actually the exhaustion of the Treasury’s extraordinary measures to raise funds) and a default.”
They put out this statement at the end of Sept. It doesn’t state they will downgrade but it doesn’t sound very confident about what happens if ceiling isn’t lifted. This is just a piece of it, I’ve posted a link to the whole statement.
“We believe that the government would continue to pay interest on Treasury securities. However, the government would have to make painful choices as to which expenditure to cut, and there is no historic precedent that provides confidence that interest payments would be prioritized over discretionary spending. In the 2014 fiscal year, the CBO projects that interest payments will account for about 7% of total federal spending, leaving still considerable room to meet interest payments in the event of 15%-20% expenditure cuts. October interest payments are relatively small, but on 15 November, the Treasury will need to pay interest of about $16 billion – equal to about 6% of average monthly revenues in fiscal 2014, although monthly revenue collection varies considerably.
“Financial market and economic consequences would likely be more severe if the debt limit is not raised than under a government shutdown. Although the expenditure reduction under the debt limit scenario is smaller, the perception that the US government could default on servicing its debt if the debt limit is not raised could roil financial markets and damage business and consumer confidence.”
Strange, your link didn’t have a trusted certificate…so I didn’t go.
Anyway, I’m not sure there aren’t crossed wires because the memo I quoted was dated 2 days ago…not last month.
Regardless, there are obviously different opinions based on different scenarios, but really…given the history of debt ceiling raises I don’t think there’s anything to worry about.
Not only has Obama just installed a pro QE Fed head, most of congress knows that the only choice is to continue the printing because otherwise is too difficult for them to handle.
—- and still a piss-ant!
Every kid you have pushes you farther right.
Yes, and apple sauce makes me fart
therefore, it must make EVERYBODY fart.
This afternoon Shifty Fedex’d his personal copy (first edition) of the classic book “Chicken Little” together with his original recording of the “Henny Penny Blues” by Lightnin’ Hopkins to his contact at the CIA. Tomorrow he will read the story to (potus) and explain it to him. Let’s hope that something good comes out of this.
If that pic up there were real, how many people would share it on Facebook and tweet it immediately? ,,, and I’m betting that “HOLY SHIT!” would be trending bigtime.
Then it would all go dark.
Boz, you just reminded Shifty of a book he has kept in storage waiting to be reread in his golden years. The name of the book is “Lucifer’s Hammer” about a comet crashing into Earth and the post-apocalyptic consequences and events. The best way to learn about it is this link about this well written book —-
politics is not your strong suit.get back to the scantily clad sluts(not the politicians,tho)