President Obama Signed HR 2775 Into Law Authorizing The Treasury To SUSPEND The Debt Ceiling – LIMITLESS Borrowing Authority Will Expire On February 7, 2014

Source: The White House

Sen. Paul Opposes Senate Debt Deal (Rand Paul, Oct 16, 2013):

Oct 16, 2013

WASHINGTON, D.C. – Sen. Rand Paul today voted no on H.R. 2775, as amended, that will suspend the debt ceiling until February 7, 2014 and fund the government to January 15, 2014.

“Tonight, a deal was struck to re-open the government and avoid the debt ceiling deadline. That is a good thing,” Sen. Paul said. “However, our country faces a problem bigger than any deadline: a $17 trillion debt. I am disappointed that Democrats would not compromise to avoid the looming debt debacle.”

From the article:

“Last night, after more than two weeks of utterly embarrassing theater, the government in the Land of the Free inked a deal to kick the can down the road a few more months. And in doing so, they set a very dangerous precedent.

As part of the bargain codified in HR 2775 (which President Obama signed into law), the Treasury Department is authorized to SUSPEND the debt ceiling. In other words, for all intents and purposes, there is now NO LIMIT government borrowing.

This limitless borrowing authority will expire on February 7, 2014. But it sets the precedent that dismissing the debt ceiling is a perfectly viable course of action.

Congress has effectively removed their handcuffs… so you can almost assuredly bet down the road that this provision will be extended, and ultimately become permanent.”

Slowly at first, then all at once (Sovereign Man, Oct 17, 2013):

“How did you go bankrupt?” Bill asked.

“Two ways,” Mike said. “Gradually and then suddenly.”

The dialogue above is from Ernest Hemingway’s 1926 novel, The Sun Also Rises.

It’s often attributed to Mark Twain or F. Scott Fitzgerald, or misquoted as something like “At first you go bankrupt slowly, then all at once.” But the theme is the same.

Nations go bankrupt in the same way. Banking collapses occur in the same way. Currency crises strike in the same way. They all happen gradually… and then suddenly. Sometimes overnight.

Read morePresident Obama Signed HR 2775 Into Law Authorizing The Treasury To SUSPEND The Debt Ceiling – LIMITLESS Borrowing Authority Will Expire On February 7, 2014

President Obama: ‘Stop Focusing On The Bloggers’ (Video)

Obama: “Stop Focusing On The Bloggers” (ZeroHedge, Oct 17, 2013):

Fast forward to 5’40” in Obama’s speech delivered earlier today.

YouTube Added: 17.10.2013

It is here that he makes the following statement:

“Now that the government has reopened and this threat to our economy is removed, all of us need to stop focusing on the lobbyists, and the bloggers, and the talking heads on radio and the professional activists who profit from conflict, and focus on what the majority of Americans sent us here to do, and that’s grow this economy, create good jobs, strengthen the middle class, educate our kids, lay the foundation for broad-based prosperity and get our fiscal house in order for the long haul.”

We will ignore the irony of a president talking about “profiting from conflict” when less than two months ago the world was on the verge of World War III over a fabricated, false flag-driven invasion “confirmed” by YouTube clips, and designed entirely by this administration to further (and profit) its Saudi and Qatari interests, and which was halted in the last minute thanks to none other than the Russian president, and ask: instead of stopping to “focus on bloggers” who merely do the math in a world in which math is long forgotten, let’s for one month, week or day, simply halt the Federal Reserve’s circular monetary authority which now purchases virtually all issued US Treasurys that carry any duration risk.

Read morePresident Obama: ‘Stop Focusing On The Bloggers’ (Video)

Fitch Puts US Credit Rating On Watch For Downgrade

Fitch puts US debt rating on watch for downgrade (AFP, Oct 15, 2013):

Rating agency Fitch on Tuesday put the United States on warning for a downgrade after Congress failed to reach a deal on raising the country’s debt ceiling.Fitch placed the United States’s top-grade AAA rating on a “negative watch”, citing the possibility the Treasury could default on its obligations after October 17 if the ceiling is not raised.

Read moreFitch Puts US Credit Rating On Watch For Downgrade

Losing Faith: Global Financiers Look To De-Americanize

Losing faith: Global financiers look to de-Americanize (RT, Oct 14, 2013):

A US debt default could hit on Thursday, and world leaders are second guessing the dominant role America plays in finance. Regardless of the final decision in Washington, confidence and credibility in the US has already eroded.

In an editorial published by the Chinese state-owned press agency Xinhua, a columnist says the US economy has ‘failed’ and put many countries who hold state assets in dollars, at risk.

“To that end, several corner stones should be laid to underpin a de-Americanized world,” the editorial read.

Last week China, the biggest US creditor, started to make preparations for a technical default on loans. The European Central Bank and the People’s Bank of China (PBC) have agreed to start supplying each other with their currencies, avoiding the dollar as an intermediary currency. The currency swap agreement will last for three years and provide a maximum of 350 billion Yuan ($56 billion) to the ECB and 45 billion euro ($60.8 billion) to the PBC.

In a further sign of growing distrust, China introduced a so-called “haircut”, or a discount, on the value of US Treasuries held as collateral against futures trades.

Read moreLosing Faith: Global Financiers Look To De-Americanize

The Five Scenarios Of A Debt Ceiling Breach

The Five Scenarios Of A Debt Ceiling Breach (ZeroHedge, Oct 14, 2013):

With the possibility of a US government default growing day by day (1Y USA CDS rose 12bps today to 72bps) amid impasse after impasse in DC, Bloomberg’s Mike McKee looks at the five possible scenarios should the debt ceiling be breached (however unlikely and ridiculous some may appear).

From prioritization of payments to across-the-board cuts, 14th amendment interventions and delaying payments, McKee explains the process and implications of each. There are no good options left but we can’t help but get the sense the Republicans might just be playing a longer-game here to take us beyond the Democrats’ “red-line” of October 17th to highlight their fear-mongering (remember the shut-down devastation?) and potentially regain some election capital (in this increasingly twisted game of picking the worst of two evils).

As McKee also notes, it seems a growing number expect us to cross the red line and for the “market” to save the day… i.e. we see a major market crash on the 18th which finally sparks DC to action…

Here’s How The October 17 ‘Debt Deadline’ Could Be Breached Even With A Last Minute Deal

Here’s How The October 17 “Debt Deadline” Could Be Breached Even With A Last Minute Deal (ZeroHedge, Oct 14, 2013):

With two days to go to until dreaded October 17 D-Day (on which incidentally, very little of note will happen, because as Goldman explained earlier today, that is simply the date past which the Treasury can no longer borrow, but still has some $30 billion in cash which could last to fund the Treasury’s needs as long as the end of the month if not longer) Washington is now openly playing with fire. Because for all the hopeful talk of an imminent deal on Thursday, then on Friday, then today, not only is there nothing substantive on the table, but Obama will not even meet with the Senate, let alone the House, until tomorrow morning. At that point there will be about 36 hours until October 17. But what is worse for all the end is nigh-ers, who are absolutely certain the world will end if Congress crosses the D-Day deadline (which, again, as Goldman said earlier going slightly past the October 17 deadline is entirely possible“) is that as The Hill explains, Senate could still miss the debt deadline, assuming there is a debt deal in the first place. Which is a big if.

Here’s how someone (coughcruzcough) so inclined (and there are quite a few conservative someones out there) could delay the process so that the magical October 17 deadline is breached.

The Hill explains:

Read moreHere’s How The October 17 ‘Debt Deadline’ Could Be Breached Even With A Last Minute Deal

The Onion’s Guide To Understanding The Debt Ceiling Crisis

The Onion’s Guide To Understanding The Debt Ceiling Crisis (The Onion, Oct 10, 2013):

The Treasury Department has warned that the continued failure by Congress to raise the debt ceiling would leave the United States unable to pay all of its bills and may force the country to default on its government bonds. Here are some helpful answers to the most common questions about the debt ceiling crisis:

What is the debt ceiling?

The debt ceiling is a specifically defined yet changeable clause in official federal legislation that ensures that our country becomes embroiled in maddening, childish theatrics every few months or years.

How high is the debt ceiling now?

Just like normal ceiling height.

When will we hit the debt ceiling?

On Thursday, Oct. 17 at precisely 5 p.m. Eastern time, when the nation’s $46 billion cable bill comes due.

What happens if the government defaults on its debt?

The United States will lose the credibility and respect we incorrectly assume other nations still hold toward us.

Read moreThe Onion’s Guide To Understanding The Debt Ceiling Crisis

12 Very Ominous Warnings About What A U.S. Debt Default Would Mean For The Global Economy

12 Very Ominous Warnings About What A U.S. Debt Default Would Mean For The Global Economy (Economic Collapse, Oct 7, 2013):

A U.S. debt default that lasts for more than a couple of days could potentially cause a financial crash unlike anything that the world has ever seen before.  If the U.S. government purposely wanted to damage the global financial system, the best way that they could do that would be to default on U.S. debt obligations.  A U.S. debt default would cause stocks to crash, would cause bonds to crash, would cause interest rates to soar wildly out of control, would cause a massive credit crunch, and would cause a derivatives panic that would be absolutely unprecedented.  And that would just be for starters.  But don’t just take my word for it.  These are the things that top financial experts all over the planet are saying will happen if there is an extended U.S. debt default.

Because they are so close together, the “government shutdown” and the “debt ceiling deadline” are being confused by many Americans.

Read more12 Very Ominous Warnings About What A U.S. Debt Default Would Mean For The Global Economy

Get Your Fiscal House In Order: China Warns US As Superpower Expresses Concern For $1.3 TRILLION Of Investments

Get your fiscal house in order: China warns US as superpower expresses concern for $1.3tn of investments (Independent, Oct 7, 2013):

‘Clock is ticking’, says Chinese minister, as US fails to break deadlock over government shutdown and fast-approaching ‘debt ceiling’ deadline

China, the biggest foreign creditor of the United States, has waded into the American budget crisis, warning Congress that it must resolve the political impasse over the debt ceiling without further delay.

The Chinese Vice Foreign Minister, Zhu Guangyao, told America’s deadlocked politicians on Monday that “the clock is ticking” and called on them to approve an extension of the national borrowing limit before the federal government is projected to run out of cash on 17 October.

Read moreGet Your Fiscal House In Order: China Warns US As Superpower Expresses Concern For $1.3 TRILLION Of Investments