In October of 2008 I posted my first article on SeekingAlpha, criticizing the then proposed bail out plan. My goal at that time was to illustrate that when we throw around dollar amounts that are in the trillions we lose touch with reality and what those numbers actually mean.
Two days ago I wrote on the subject again, specifically mentioning the dangerously irresponsible increases to the federal debt limit and their future implications. Well, with the digital ink from that article still wet, I regret to inform you that the senate has yet again proposed to increase the debt limit, this time by 1.9 trillion dollars.
1.9 trillion... it sounds like a marketing ploy, like a $1.99 special. Why not just say two trillion and get it over with? At this point the government has all but admitted that they will need to issue more new debt in order to avoid a debt obligation default.
I don’t want to panic anyone and I certainly hope that things will not continue on this path but the governments financial books are starting to look like those of Citigroup (C) and GM in 2007. And why not? The government owns Citigroup and GM. The only real difference is the governments can force new taxes and it can force inflation.
Disclosure: No positions