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Treasury Quietly Plans for Failure to Raise Debt Ceiling (lip)
We're damned if we do and damned if we do not. If we do, that - by definition in my opinion - is kicking the can down the road. We're in trouble later because the whole thing is already unsustainable and confidence in our ability to be fiscally responsible has already eroded. We don't raise the debt ceiling and confidence from foreign creditors erodes a lot quicker.
The whole thing is a "Simpsons" episode from several years ago when Lisa becomes president and the country is bankrupt. All the countries who loaned us money are visiting demanding their money now. Bart assures them that the checks have been sent (they haven't) and telling them "I thought you were cool" when they get upset about not getting their money.
FWIW...Jim Rickards thinks the whole world is basically broke, and that the US could force the world back onto a gold standard and that we would win the ensuing "gold war". Of course, there would be much pain and large scale civil unrest in the process.
Disclaimer: I have no idea who this guy is -- friend forwarded the link.
The debt ceiling is an artificial construct that has never done what it was intended to do. Why keep something that is useless and potentially toxic? Does no one have any sense? If you put up a baby fence that not only didn't keep the baby secure but also caused the baby to fall down the stairs each time the baby approached it, would you keep trying to use the fence? I think you would find another way to secure the baby even if it required you put in more effort. What we now know is that in creating the debt ceiling concept we had a bunch of babies trying to create their own baby traps. That's just stupid.
Rickards is really my favorite economist and while I don't agree with him on everything, he's probably the one my views are closest to. Given that his expertise is in threat finance, his presentations provide a unique perspective on global finance, as well.
The 90 minute presentation above is worth watching.
This presentation can also really, really ruin your day. You can't help but watch this and think the only thing you should be investing in is gold bullion. And guns. And guns made from gold.
"The whole world is basically broke".
"Historically the way nations grew wealthier and more powerful was by war and plunder".
But, at least the US has boatloads of gold (as do our Western allies).
I actually think it's a lot less gloomy than Marc Faber (nothing against Faber, who I like and find his soundbites - "Vee are all doomed", in his particular accent - amusing), and I think what Rickards provides is thought-provoking and useful in a lot of regards - there is some interesting discussion by Rickards during the Q & A portion of his experiences trying to buy distressed assets from banks, for example. It's not the world is ending, but a discussion of the realities (which aren't sunny, but for that there's always CNBC Fed Muppet Steve Leisman) of the world today from a global perspective.
Again, I like the element of geopolitics that Rickards brings to his discussions, as I think it will be a larger and increasingly important element of financial discussions in years to come. Additionally, in terms of financial TV, it's certainly unique in that it's not just "Well, I like Apple", but Rickards often provides a BBC-like discussion of world events crossed with how that effects the financial markets. Rickards has also provided quite a few interviews for King World News and CNBC.
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The whole thing is a "Simpsons" episode from several years ago when Lisa becomes president and the country is bankrupt. All the countries who loaned us money are visiting demanding their money now. Bart assures them that the checks have been sent (they haven't) and telling them "I thought you were cool" when they get upset about not getting their money.
Disclaimer: I have no idea who this guy is -- friend forwarded the link.
The 90 minute presentation above is worth watching.
"The whole world is basically broke".
"Historically the way nations grew wealthier and more powerful was by war and plunder".
But, at least the US has boatloads of gold (as do our Western allies).
Again, I like the element of geopolitics that Rickards brings to his discussions, as I think it will be a larger and increasingly important element of financial discussions in years to come. Additionally, in terms of financial TV, it's certainly unique in that it's not just "Well, I like Apple", but Rickards often provides a BBC-like discussion of world events crossed with how that effects the financial markets. Rickards has also provided quite a few interviews for King World News and CNBC.
A good example of a quicker Rickards discussion is this Bloomberg segment:
http://www.tangentcapital.com/press.html#bloombergunrest