Whât Îf - The Debt Ceiling is not Raised??·

[The Virginian]

Just What will happen if Congress refuses to raise the debt ceiling?


Will all Heck break loose? Will the economy collapse? What is your thoughts?

[kman]

Congress has a far superior health plan and retirement plan. I bet they keep it....what ceiling!

[traelin0]

Jan 17, 2011 17:49:53 GMT -5 The Virginian said:

Just What will happen if Congress refuses to raise the debt ceiling?


Will all Heck break loose? Will the economy collapse? What is your thoughts?

We already defaulted on our obligations once, when Nixon closed the gold window. But we were a net creditor nation and could afford to tell France and the rest of Europe to fly a kite. If we defaulted on the world again...

That's not to say we should raise the debt ceiling though. I'd rather deal with years of pain accompanied by freedom. And that is exactly what we'd get.

[traelin0]

[verrip1]

"If my uncle had a period, would he be my aunt?" ;D

I predict that the heavens will not open, releasing an engorgement of frogs. That Starbucks will not become the Tea Party. That Lady Gaga will not sing "Yummy, Yummy, Yummy, I've Got Love In My Tummy".

[sangria]

"He's right. Lady Gaga will never sing that."

[wyouser]

Is it really a collapse..some discussion floating around that all it means is they cant spend more than what is coming in if the ceiling is not raised.

[lifewasgood]

I don't think some on this board understand much about the world financial situation we find ourselves in. At this point the debt ceiling is not the issue. The real issue is devaluing dollar which will lead to hyperinflation. The dollar losing the reserve currency status is of much more concern. This will lead us into a one world currency purchased in blood.

[neohguy]

Continuously raising the debt ceiling is no different than a person that kept transferring credit card balances so that he could max out another card. Eventually it doesn't work anymore and people holding the paper get burned and the individual is required by a bankruptcy judge to pay back a percentage of the balance. The amount is garnished from his paycheck and he no longer has access to any credit.
If congress doesn't raise the debt ceiling then all hell will break loose. If congress raises the debt ceiling then worse hell will break loose later. Since kicking the can down the road is in vogue then I expect the debt ceiling to be raised after some theatrics.

[traelin0]

Agreed, neo. My bet is that China will own Yellowstone National Park at some point. I am only half-kidding...

[The Virginian]

There is talk of Congress trying to impose restrictions on cutting costs in return for raising the debt level. This seems the most practical to me but in reality I don't know if Congress is capable of making any hard decisions. I guess time will tell.....

[bga4444]

Is Iceland still there? Doing business same as usual? They told the banks to GTH!

[The Virginian]

Why yes they are ;D

[itstippy]

On the headline "jobs stimulus" front, a new $50B initiative for high speed passenger rail:
finance.yahoo.com/news/Obama-to-call-for-53B-for-apf-3597272009.html?x=0&sec=topStories&pos=7&asset=&ccode=

Elsewhere, big defense money is being deployed to create jobs. One of my home state's major manufacturers, Oshkosh Truck, has been landing huge defense contracts one after the other ever since the recession hit in 2008. Another, Marinette Marine, has done the same. Just between those two companies we're talking billions of federal dollars over the past two years. I imagine the California military aerospace industry has been rockin' for some time now too - imagine what it costs to replace all those smart bombs & cruise missiles we fired off in Shock & Awe? Not to mention rebuilding/replacing all the Abrams tanks and other armored vehicles we burned up in the ground war. Blowing sand and heat destroys turbo-diesels in no time.
www.washingtonpost.com/wp-dyn/content/article/2006/12/04/AR2006120401347.html

These huge budget expenditures are cushioning the blow of the Great Recession a LOT. It's "stealth stimulus" and it's not a new concept at all. Wartime economies are great because you borrow money like crazy and use it domestically to produce war material. It's the aftermath, the winding down, that hurts. We aren't doing that yet. Not even close.

Not raise the debt ceiling? Who are they kidding?

[usaone]

Compromise...debt ceiling is raised some and spending is cut some.

Remember when Japan was going to own us in the 1980's?

Didnt happen.

A lot of hysteria back then too!

[itstippy]

No spending cuts other than window-dressing. Just a bunch of bluster & hot air.

www.bloomberg.com/news/2011-01-28/appropriations-committee-loses-allure-in-u-s-congress-targeting-spending.html

[traelin0]

Feb 11, 2011 20:29:19 GMT -5 usaone said:

Compromise...debt ceiling is raised some and spending is cut some.

Remember when Japan was going to own us in the 1980's?

Didnt happen.

A lot of hysteria back then too!

Our situation today is not even remotely close to America of the 1980s.

[decoy409]

The Truth About the Debt Ceiling
Separating economic fact from economic myth
reason.com/archives/2011/02/03/the-truth-about-the-debt-ceili/1

I see big inflation, period.

[decoy409]

And you will want to run the CBO report as well,

cbo.gov/ftpdocs/120xx/doc12039/01-26_FY2011Outlook.pdf

[verrip1]

Feb 11, 2011 20:03:50 GMT -5 @itstippy said:

On the headline "jobs stimulus" front, a new $50B initiative for high speed passenger rail:
finance.yahoo.com/news/Obama-to-call-for-53B-for-apf-3597272009.html?x=0&sec=topStories&pos=7&asset=&ccode=

Elsewhere, big defense money is being deployed to create jobs. One of my home state's major manufacturers, Oshkosh Truck, has been landing huge defense contracts one after the other ever since the recession hit in 2008. Another, Marinette Marine, has done the same. Just between those two companies we're talking billions of federal dollars over the past two years. I imagine the California military aerospace industry has been rockin' for some time now too - imagine what it costs to replace all those smart bombs & cruise missiles we fired off in Shock & Awe? Not to mention rebuilding/replacing all the Abrams tanks and other armored vehicles we burned up in the ground war. Blowing sand and heat destroys turbo-diesels in no time.
www.washingtonpost.com/wp-dyn/content/article/2006/12/04/AR2006120401347.html

These huge budget expenditures are cushioning the blow of the Great Recession a LOT. It's "stealth stimulus" and it's not a new concept at all. Wartime economies are great because you borrow money like crazy and use it domestically to produce war material. It's the aftermath, the winding down, that hurts. We aren't doing that yet. Not even close.

Not raise the debt ceiling? Who are they kidding?

Thinking like this is what got us into the problem we're in. You can't spend your way out of debt with all the 'good vibes' and rah rah crap and 'move into the future and screw the impact'. Short term construction jobs which leave the citizenry with high maintenance, labor and pension costs for the long term. All the 'stimulus' we've already had and U6 is still near 17% - wotta wonderful impact all that stimulus money has done, lets spend some more!!!!!

Remember someone's definition of insanity? 'repeating the same mistake over and over again, and expecting a different outcome'.

[decoy409]

verrip1, you are correct. I put it as Peter borrowing from Paul. Concept never changed.

Quote: Remember someone's definition of insanity? 'repeating the same mistake over and over again, and expecting a different outcome'.

Read more: notmsnmoney.proboards.com/index.cgi?board=moneytalk&action=display&thread=1795#ixzz1Di4qBNm4

[itstippy]

The Fed could sell $1 trillion of the fabulous assets it purchased at fire-sale prices during the irrational financial panic. Turn the windfall profits over to the Treasury. That'd buy us 9 more months.

Then the Fed fires up QE3 and buys more assets. Rinse and repeat.

It's brilliant, I tell ya.

[AgeOfEnlightenmentSCP]

Jan 17, 2011 17:49:53 GMT -5 The Virginian said:

Just What will happen if Congress refuses to raise the debt ceiling?


Will all Heck break loose? Will the economy collapse? What is your thoughts?

The Dollar would go up 10% in a day, 50% in the ensuing 12 months.

[The Virginian]

Maybe the question should have been - What is going to happen when they raise the debt ceiling again? ;D

[dumdeedoe]

Debt ceiling is not the problem...debt default is.....

Imagine if the feds could no longer pay thier bills.... And their credit rating went down the tubes......

[silverguy25]

www.washingtonpost.com/wp-dyn/content/article/2011/02/16/AR2011021606897.html?sid=ST2011021701806

Frank, I had a laugh at your last post. Thanks for that.

Judging from the article, and basic common sense, we're going to be paying alot more taxes in the future. I thought I was paying too much already. I wonder what the reaction will be like when they hike everyones tax rates up to 40 percent?

[vl]

March 4th. Government shut down. Boner doesn't get it.