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Post by chang on May 30, 2023 16:16:36 GMT
Market exuberance appears to be anticipating a quick budget settlement. What market exubernace is that? I had higher hopes for today given the pending debt ceiling resolution.
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Post by Chahta on May 30, 2023 17:04:01 GMT
Market exuberance appears to be anticipating a quick budget settlement. What market exubernace is that? I had higher hopes for today given the pending debt ceiling resolution. I think your failed hopes are evidence that this debt ceiling deal was no big deal. Kind of like Y2K nonsense.
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Post by Capital on May 30, 2023 17:33:55 GMT
What market exubernace is that? I had higher hopes for today given the pending debt ceiling resolution. I think your failed hopes are evidence that this debt ceiling deal was no big deal. Kind of like Y2K nonsense. I would be more excited if they were just eliminating the debt ceiling altogether. JMHO. I do not relish living through this more times in my future.
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Post by chang on May 30, 2023 18:02:59 GMT
Moved this from the BSW thread. I probably would not have commented if I had noticed this was in BSW. Please keep it civil.
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Post by Chahta on May 31, 2023 3:32:35 GMT
Moved this from the BSW thread. I probably would not have commented if I had noticed this was in BSW. Please keep it civil. I did not notice it either. Sorry.
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hondo
Commander
Posts: 145
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Post by hondo on May 31, 2023 13:59:49 GMT
I think your failed hopes are evidence that this debt ceiling deal was no big deal. Kind of like Y2K nonsense. I would be more excited if they were just eliminating the debt ceiling altogether. JMHO. I do not relish living through this more times in my future.
Without a debt ceiling, congress could go wilder. There must be at least some control over congress. On the other hand, having a debt ceiling hasn't stopped them yet. They just keep spending despite the debt ceiling. Congress seems to think, do what ever it takes to get reelected. They don't worry about the debt. Let it grow. Let a future congress worry about it. There is one thing for certain, increasing the national debt year after year can not go on for ever. If it does, some day out country will collapse.
Just another point of view.
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Post by Fearchar on May 31, 2023 15:06:37 GMT
Consider Argentina as they have no debt ceiling. Instead of arguing about it, they print all the money that they need. Of course inflation is completely out of control.
It is good if you own the printing presses, or have a connection. For most people though, it makes for a crazy life. No point in saving money, at least not in the local currency.
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Post by johntaylor on May 31, 2023 16:07:34 GMT
Krugman has a Nobel. I don't -- at least until I create a Wikipedia page and award myself one:
"The US government doesn't have to pay off its $31 trillion debt, Paul Krugman said. The government debt can't be compared to something like a household's finances, Krugman said. 'When governments for one reason or another run up large debts, it is, as far as I can tell, unusual to pay those debts off.'"
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Post by Capital on May 31, 2023 20:04:23 GMT
I would be more excited if they were just eliminating the debt ceiling altogether. JMHO. I do not relish living through this more times in my future.
Without a debt ceiling, congress could go wilder. There must be at least some control over congress. On the other hand, having a debt ceiling hasn't stopped them yet. They just keep spending despite the debt ceiling. Congress seems to think, do what ever it takes to get reelected. They don't worry about the debt. Let it grow. Let a future congress worry about it. There is one thing for certain, increasing the national debt year after year can not go on for ever. If it does, some day out country will collapse.
Just another point of view.
hondo , it seems to me that you talked your way into agreeing with me. Since Congress made the debt ceiling law and controls it by raising it, it serves no positive purpose because Congress will never control itself. All it does is cause calamity in our markets and society every year or so. We have enough crisis occurring to not need an artificial self-made crisis every year of two. If it served any positive purpose, I would say keep it. It just no longer serves any positive purpose IMHO.
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Post by Chahta on May 31, 2023 20:31:28 GMT
Capital, I understand your opposition to a debt ceiling. Just get rid of it and move on. How would you approach the debt spending and the accumulation of debt? It appears the debt ceiling served as a bargaining chip this time and served a positive purpose. Albeit it a baby step towards deficit reduction.
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hondo
Commander
Posts: 145
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Post by hondo on May 31, 2023 22:29:53 GMT
Krugman has a Nobel. I don't -- at least until I create a Wikipedia page and award myself one: "The US government doesn't have to pay off its $31 trillion debt, Paul Krugman said. The government debt can't be compared to something like a household's finances, Krugman said. 'When governments for one reason or another run up large debts, it is, as far as I can tell, unusual to pay those debts off.'" There used to be a radio talk show host who sometimes said about certain people, "He is educated beyond his intelligence". This may be the case of Krugman.
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hondo
Commander
Posts: 145
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Post by hondo on May 31, 2023 22:52:01 GMT
Without a debt ceiling, congress could go wilder. There must be at least some control over congress. On the other hand, having a debt ceiling hasn't stopped them yet. They just keep spending despite the debt ceiling. Congress seems to think, do what ever it takes to get reelected. They don't worry about the debt. Let it grow. Let a future congress worry about it. There is one thing for certain, increasing the national debt year after year can not go on for ever. If it does, some day out country will collapse.
Just another point of view.
hondo , it seems to me that you talked your way into agreeing with me. Since Congress made the debt ceiling law and controls it by raising it, it serves no positive purpose because Congress will never control itself. All it does is cause calamity in our markets and society every year or so. We have enough crisis occurring to not need an artificial self-made crisis ever year of two. If it served any positive purpose, I would say keep it. It just no longer serves any positive purpose IMHO. Capital, we do agree that the debt ceiling seems to do no good. This morning I read that the debt ceiling has been raised something like 80 or 90 some odd times since it started. So you are right, what good does it do. Congress just kicks the can down the road, but don't you agree that something needs to be done about it? We don't want the US to go down the road of Argentina. The trouble is that neither party has the guts to do whatever it takes, even if they know what it takes. I sure don't know. We elect congress and pay them to figure it out, but I believe they don't want to correct the problem because it will be very painful and the party that has the guts to correct the problem will likely loose many votes. After all, the number one goal of any elected official is to get reelected, the country be dammed.
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Post by steadyeddy on May 31, 2023 22:54:15 GMT
Capital , I understand your opposition to a debt ceiling. Just get rid of it and move on. How would you approach the debt spending and the accumulation of debt? It appears the debt ceiling served as a bargaining chip this time and served a positive purpose. Albeit it a baby step towards deficit reduction. It serves as a reasonable check/balance particularly in a dominant 2-party system like the USA.
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Post by bugman on May 31, 2023 23:23:11 GMT
Sadly, neither party has the guts to do what's necessary. Increase revenue (taxes) and decrease spending. Good luck with that....
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Post by roi2020 on Jun 1, 2023 2:16:57 GMT
Capital , I understand your opposition to a debt ceiling. Just get rid of it and move on. How would you approach the debt spending and the accumulation of debt? It appears the debt ceiling served as a bargaining chip this time and served a positive purpose. Albeit it a baby step towards deficit reduction. It serves as a reasonable check/balance particularly in a dominant 2-party system like the USA. No other western nation except for Denmark has a debt ceiling limit based on an absolute monetary value. Danish politicians consider the debt ceiling to be a formality and not a political issue. Denmark doesn't experience periodic debt ceiling shenanigans like we do. It's extremely imprudent to risk the full faith and credit of the U.S. for incurred debts. In effect, our country is now being held hostage. Spending priorities should be negotiated during the Federal Budget and Appropriation process as a normal course of action.
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Post by Capital on Jun 1, 2023 2:23:07 GMT
Capital , I understand your opposition to a debt ceiling. Just get rid of it and move on. How would you approach the debt spending and the accumulation of debt? It appears the debt ceiling served as a bargaining chip this time and served a positive purpose. Albeit it a baby step towards deficit reduction. Chahta, I think that, with every spending or tax reduction bill, there should be a section describing the effect that bill should have on the debt. Address the debt issue as a cause and effect issue at the time of original legislation. That section should also include curbs on spending or increases in taxation if the stated effects are not met. If stated in the original bill the curbs would automatically occur. Force the hard decisions to be made or cause Congress to create a better solution with new legislation either reducing the benefit to society or increasing tax to cover the cost.
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Post by chang on Jun 1, 2023 5:55:09 GMT
The House passed the bill 314-117.
For the record, I did assert there was a 99.999% probability that a last minute bill would be passed to prevent default and electoral suicide by both parties. I’m standing by that prediction.
On to the Senate.
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Post by steadyeddy on Jun 1, 2023 11:52:28 GMT
The House passed the bill 314-117. For the record, I did assert there was a 99.999% probability that a last minute bill would be passed to prevent default and electoral suicide by both parties. I’m standing by that prediction. On to the Senate. chang, agree completely! All things considered, no party/faction/side wants to prolong this issue. I also expect a quick passage through Senate.
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Post by steadyeddy on Jun 1, 2023 11:55:44 GMT
It serves as a reasonable check/balance particularly in a dominant 2-party system like the USA. No other western nation except for Denmark has a debt ceiling limit based on an absolute monetary value. Danish politicians consider the debt ceiling to be a formality and not a political issue. Denmark doesn't experience periodic debt ceiling shenanigans like we do. It's extremely imprudent to risk the full faith and credit of the U.S. for incurred debts. In effect, our country is now being held hostage. Spending priorities should be negotiated during the Federal Budget and Appropriation process as a normal course of action. roi2020, the risk is only real if the market believes pols won't resolve the issue quickly. We are where we are... here is what chatGPT told me about debt ceiling when I asked "when was debt ceiling introduced in the USA?" The debt ceiling, also known as the statutory debt limit, was first introduced in the United States in 1917. It was established as part of the Second Liberty Bond Act, which was enacted during World War I. The purpose of the debt ceiling was to provide the U.S. Treasury with a legal limit on the amount of debt it could issue. This limit was intended to control government spending and borrowing. Since its introduction, the debt ceiling has been periodically adjusted by Congress to accommodate the growing financial needs of the federal government.
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Post by roi2020 on Jun 2, 2023 4:41:33 GMT
US Congress averts historic default, approves debt-limit suspension
"The U.S. Senate on Thursday passed bipartisan legislation backed by President Joe Biden that lifts the government's $31.4 trillion debt ceiling, averting what would have been a first-ever default."
"The Senate voted 63-36 to approve the bill that had been passed on Wednesday by the House of Representatives, as lawmakers raced against the clock following months of partisan bickering between Democrats and Republicans."
"With this legislation, the statutory limit on federal borrowing will be suspended until Jan. 1, 2025. Unlike most other developed countries, the United States limits the amount of debt the government can borrow, regardless of any spending allocated by the legislature."
"Treasury Secretary Janet Yellen, meanwhile, issued some pointed advice saying, 'I continue to strongly believe that the full faith and credit of the United States must never be used as a bargaining chip,' as Republicans did over the past several months."
www.reuters.com/world/us/us-senate-aims-quick-passage-debt-ceiling-bill-avoid-default-2023-06-01/
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Post by FD1000 on Jun 2, 2023 14:06:37 GMT
From the start, I didn't believe that anything drastic will happen, after all, it has to pass, sooner or later. Politicians play games and delays all the time, but they pass bills when they must.
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Post by Chahta on Jun 2, 2023 16:23:04 GMT
From the start, I didn't believe that anything drastic will happen, after all, it has to pass, sooner or later. Politicians play games and delays all the time, but they pass bills when they must. This is because the radicals on both sides were locked out of negotiations.
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Post by archer on Jun 2, 2023 16:51:21 GMT
Krugman has a Nobel. I don't -- at least until I create a Wikipedia page and award myself one: "The US government doesn't have to pay off its $31 trillion debt, Paul Krugman said. The government debt can't be compared to something like a household's finances, Krugman said. 'When governments for one reason or another run up large debts, it is, as far as I can tell, unusual to pay those debts off.'" Interesting perspective. If pretty much all countries have debt, then debt becomes normalized rather than seen as a problem, as long as any one country's debt in relation to GDP is within the normal range relative to others.
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Post by FD1000 on Jun 2, 2023 20:43:42 GMT
From the start, I didn't believe that anything drastic will happen, after all, it has to pass, sooner or later. Politicians play games and delays all the time, but they pass bills when they must. This is because the radicals on both sides were locked out of negotiations. There is no way to default. The world will be in chaos. Pretty simple IMO. The markets would teach the politicians a quick lesson.
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Post by steelpony10 on Jun 2, 2023 22:32:29 GMT
I still don’t think the national debt matters. It’s been around since Hamilton. In a pinch it can be negotiated down just like other countries.
If the national debt bothers others never invest in government paper. Your loaning the Feds money.
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Post by Chahta on Jun 2, 2023 23:26:31 GMT
The debt matters because of the tax revenues it consumes, which by the way is increasing. It also matters because of the irresponsibility of handling others money. China and others will never negotiate for less. That is a sign of credit unworthiness.
Investing in T bills/bonds has nothingq to do with liking the US debt.
There is a way to default. Interest can be paid but benefit checks could be held and other payments held as well.
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Post by steelpony10 on Jun 3, 2023 10:35:03 GMT
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Post by Chahta on Jun 3, 2023 15:02:50 GMT
Well sure debt finances the government. Doesn’t make it good. Is there ever too much debt?
What we actually have is not debt. Debt is paid off on a schedule. We issue more debt to pay the current debt. What we have is uncontrolled expenditures.
That article is rationalizing why politicians can’t control excess spending. Debt should only be incurred to finance beneficial things, not to send money into black holes overseas.
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Post by Capital on Jun 3, 2023 16:33:10 GMT
Folks it might possibly be time to move on to our next crisis. We always got another new one to make and live thru. After that darn jobs report the FED may increase the cost of credit another 25bp the middle of June 2023 trying to get inflation back in that darn bottle.
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Post by Chahta on Jun 3, 2023 16:44:20 GMT
Folks it might possibly be time to move on to our next crisis. We always got another new one to make and live thru. After that darn jobs report the FED may increase the cost of credit another 25bp the middle of June 2023 trying to get inflation back in that darn bottle. Maybe true, but the debt is real and unsustainable. $610 per month per US family is required to SERVICE the debt. On to the next crisis does exactly what the government wants and why the debt ceiling should not be removed. That is how they “hide” what is going on.
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