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Pulling out the big guns in the battle over the debt ceiling, President Obama tells CBS he...
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Tuesday, July 12, 2011, 1:25 PM ETPulling out the big guns in the battle over the debt ceiling, President Obama tells CBS he cannot guarantee Social Security checks will go out on August 3 if the issue is not resolved. "There may simply not be the money in the coffers to do it."
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P.S. I've been a registered Republican for 20 years, yet I recognize now that both parties are bunk, and the whole system needs to be re-factored (it's broken).
Edit: To add that Paul Ryan appears to be the first pundit/ politician to have played this card.
When I see parrot squawking repetition without substance I will attribute it to parrots.
I was commenting on one specific thing only.
Particularly since I sell puts on TLT. I am betting the hyperinflation crowd and so far every put I have sold has expired worthless.
This system is loaded with tax gifts for the well off. Consider the SEP IRA. The 2011 contribution is $49k. That's an immense deduction from your taxable income. I maxed the SEP IRA for 8 consecutive years.
No one should be feeling sorry for myself or anyone else in the top 1% of per capital income.
A focus group of one person as in you is not statistically significant.
Again......focus group of one.
I feel sorry for people, at my company for example, who do not take advantage of a 401k opportunity and miss out on 100% profit by not taking advantage of a dollar for dollar match on up to 5% of their income. Are they dumb? Are they uninformed? Do they not have enough money to save 5% of their income? I don't know.
I don't care what the tax rates are.....they are too high. Taxes last year were only 14.9% of GDP. They have been higher in the past, and we now are in a depression.
When I pay enough taxes to provide for 2 families - and see it being wasted and pissed down the river stupidly it grates severly.
There is more than enough money to take care of the truly needy.
There is not enough money to take care of the truly lazy.
For the politicians to engage on rhetoric that pits the poor against the rich is untoward and unbecomming. Of course we do not have leaders. They are there to satisfy their own self interests.
You can't escape from the things you have done.
That was built over many decades but don't let me tax your brain with heavy lifting.
Hindsight being 20/20 that particular engagement looks wasteful and unnecessary. I do not buy into the whole Bush lied us into war mantra. Likely that was a result of bad intel and post 9/11 anti-terrorist "let's get those bastards" hysteria.
I recall some discussions we had months age during which you discounted as remote the possibility that the debt ceiling issue would be the tipping point for a US fiscal crisis. Do you still hold to that view?
I don't ask this in criticism of you're having made the earlier prediction; That was a logical assumption at the time and, arguably, this political crisis could easily been avoided.
Must be mental telepathy. See my just-posted comment.
I hate this stupid fear-mongering by this guy. I hope Charley Sheen wins in 2012, can't be any worse than what we have running now.
Show us data to support your opinions. There was no dramatic uptick in government spending. But tax revenues did fall and guys like supported the tax break extension.
Not true. Just a few days ago he said that "some of those shovel ready projects were not quite shovel ready.."
In an August 5, 2009, interview on NBC News, Obama said that:
“The last thing you want to do is raise taxes in the middle of a recession, because that would just suck up, take more demand out of the economy and put businesses in a further hole.”
He is definitely citing the scariest source of cuts, but that doesn't make him a liar in this case. If the debt ceiling is not raised I completely expect that everything will be cut off that can be before they go after Social Security, Medicare and Defense.
Considering that spending will be drastically reduced in that scenario, and those three areas make up the majority of government spending on their own, the government will have no choice but to immediately make significant cuts to all three of those programs. Even if they cut everything else but these three areas completely it would not make up for the shortfall.
So is he focusing on the scariest cut to most people....you bet he is, but that doesn't make him a liar. In this case I believe he is unfortunately very truthful.
Like I said in my first post I can make the case that the end result of that scenario could be a positive. However, the shorter term economic impact would be very harmful to asset values as the economy dealt with the resulting turmoil from our own austerity.
I would really like to see a middle road approach where the ceiling is marginally raised, with matching or greater spending cuts, and no tax hikes in order to start weaning the country and economy off the government teat. I am concerned going cold turkey like we are discussing could have very adverse affects, if only for a potentially short period while we adjust.
Typical Chicago Politics...I wonder when the Dog food line will come out...
Does anyone else see a risk that arc of both the US and EU will hit a very troubling patch simultaneously over the next four to eight weeks?
My take:
The problem is squarely in the Republicans' camp because the Democrats are in a win-win situation, as far as their own scorched-earth strategy goes. If the Republicans blink and allow the slighest tax increase, then, they are dead as door nails with their own constituencies. If the Democrats don't allow cuts without tax increases (what's needed, in fact), then, the U.S. will likely enter a technical default (with or without accompanying Moody's downgrade) and panic and chaos are likely to reign. The problem for Republicans is that the Democrats know (correctly) that they can frame the issue, with the media's help, that the disaster was occasioned because Republicans refused to add "modest" new taxes on "the rich." In essence, the Democrat have nothing to gain, politically by forestalling collapse of talks and default unless they get their tax increases.
I'd add that, even though many argue that the funds are there to avoid default, the Democrats may actually force a default because they will see themselves as the beneficaries of the ultimate fallout. That's why Geithner is so vocal about the consequences of no agreement.
If the U.S. goes the "nuclear" route, then, I'd expect the Europeans to follow, whether they wish to do so, or not. Events would just run away from them.
To say the least, it's not a pretty scenario for anybody who wants to be long any class of investments, save, maybe, gold. And, likely, a long depressed economic period would follow.
The real question, now, is do the armed assailants (the Democrats and the Republicans) kill all the hostages, us, and commit suicide?
That seems to be the game plan. Mutual suicide based on ideology seems to be what both sides are trying for here.
While I can see the Pubbies points in relying on promises from the Demmies - after getting burned on the Bush tax increase where they promised cuts and instead increased spending - Their total refusal to consider killing some of the tax breaks makes them look like the kid that stabs his basketball rather than let all the kids play.
Simultaneously, I'm curious if you are aware of how much strength the US had as a result of a large middle-class built-up through the 50's and 60's?
Not that some Americans much care what the rest of the world thinks but US international credibility will take a major hit if a reasonable resolution of what is essentially a political problem i(i.e. the debt ceiling and the settling of a budget)s not achieved in a timely fashion.
This on top of the US handling of its fiscal affairs and financial markets in the years leading up to the 2007/8 meltdown will not be well received by those of us in other countries suffering collateral damage from US handling of its domestic affairs.
If the Reps are in a position where they lose no matter what then it is unpredictable what they might do as there is a core of the party that likely will not change their view of taxes. A bad outcome will hit everyone in WDC and I think Obama senses this and is trying to figure out a way to make something happen that avoids unpredictable outcomes. He likely feels he can win the next election if we roll into 2012 without any major catastrophies. And he does not want some major default on his record.
So it is possible he may throw the liberals under the bus and do a deal with Reps and Dems of some sort that leave the far right and left out but get something done.
I don't believe he can afford to just dig in and see a major event and then get away with blaming other parties.
I would not bet on this with your money!
Not that one wants to overstate the obvious but the following articles and reports give some flavour of what the press in Canada and the UK are saying in reaction to the US debt ceiling debate.
fullcomment.nationalpo.../
business.financialpost.../
www.theglobeandmail.co.../
www.guardian.co.uk/wor...
The Continental European press are understandingly focused at present on the EU's own pressing problems but will be predictably outraged if those problems are exacerbated by a political impasse in the US over the debt ceiling issue.
Good points, but.....
The "but" is, just watch the rest of the Dems, like Pelosi, when Obama tries his own grandstanding for a deal. If Obama leans rightward, the rest of the Dems in Congress may just wave at him. He can't do a deal by himself.
My guess is that whatever happens, it happens at 11:59PM. And, it's unclear what the outcome will be. Therefore, I'd expect mounting pressure on markets as the anxiety mounts and time dwindles.
Nothing earth shaking in those article. The comments under the Frum article in the National Post reflected a lot of the same beliefs here in the US and some were funny.
Europe is a mess and needs to focus their rage on themselves. They cannot even get Greece under control and now have Italy in play.
I also believe that. Unfortunately, I'm afraid what gets done will be another solution that we have to pass so we can find out afterwards what was written.
It is a tough call. If he is smart he will grab the Dems by the ear right now while he still has time and tell them he is going to work out a deal with Reps and if they don't support him then he will chuck them so far under the bus they will never come out.
Basically pull a Clinton.
The difference, though, is that Clinton was a scallywag and just wanted to be loved by all; Obama is a true believer, who wants to masquerade otherwise from time to time.
He can definitely say whether there is or isnt, will or will not be enough money available to pay out SS benefits, that he isnt being clear about this proves that he is playing the fear card trying to force the Republicans hand.
www.ftportfolios.com/C...
www.ftportfolios.com/C...
He is probably more worried about giving money to the non working youth and whoever else he can deceive into voting for him though