US defaults next week what does everyone think?
- Thread starter Capt.Toilet
- Start date
-
Two Factor Authentication is now available on BeyondUnreal Forums. To configure it, visit your Profile and look for the "Two Step Verification" option on the left side. We can send codes via email (may be slower) or you can set up any TOTP Authenticator app on your phone (Authy, Google Authenticator, etc) to deliver codes. It is highly recommended that you configure this to keep your account safe.
There are a whole lot of ifs there. First off, the Tea Party is generally unreasonable in most matters (while it's original rallying cry of fiscal responsibility is indeed a good thing, the originalism it espouses is completely ridiculous--especially given that the constitution was entirely meant to be altered as it goes). Secondly, if Aug 2 comes and there is no end of the world: why on Earth would the Dems give into their demands? The deadline is being used to shove an agenda, and if the deadline has no merit, then why the crap would the people that hold the senate and presidency give in? Aside from the fact that on both sides of great party divide, people want to reduce the deficit, the only real hope that tea party members have of getting even part of their agenda through is that defaulting is a bad thing to be avoided.
As for market action: while I will concede the majority of points to you (as you have a much stronger background than I), everything I have seen is that yes, losing triple-A would be a pretty fraking bad thing, but no, no one really believes that this would actually come to pass, even tea party politicians have SOME lick of sense in them.
What strikes me about the bill passing is that it needs to STOP trying to appease the tea party. Boehner keeps making it worse and worse in the eyes of the Dems to appease the tea party, even though they still won't budge. If the freaking idiot would stop for a second, realize that they can't get it past the senate or the pres as it is, and be willing to stand up to the extreme right within his party, it wouldn't be that hard to get something that would actually get Dem votes in both the house and the senate.
The way I see it is that Obama came into office riding on the idea of bipartisanship, but he has largely failed in that regard. The Republicans swept into office largely on dissatisfaction with that failure (and let's not kid ourselves: there is NEVER a mandate from the public. Obama's election was NOT a mandate to pass more dem bills and the Republican House switch was NOT a mandate to pass more rep bills) and here there is an opportunity for a Republican leader (Boehner) to reject their own party's extreme (as the dems didn't do nearly as much as they should have) and actually put forward something looking like bipartisanship (because honestly, even Boehner isn't that far from the center, except that he's trying to appease a small group of rabid people). To be honest, I don't think that he's up to it, just as Obama largely wasn't.
Fucking politics.
humor me and answer these questions. notice no sarcasm and smiley faces here...
you do understand that we will NOT default, right?
you do know S&P is saying that we need to cut at least 4 trillion?
so what should we do, pass bills that cut 1 trillion and raise the debt ceiling? what do we gain by that? next time we'll be in more debt and it will just be another "crisis" (that should never go to waste). then we'll just have to cut back even more government or even cut into entitlements. how is that better? at least we have reasonable choices now. later we wont
Last edited:
Do I understand that we will NOT default? I understand that we can continue to make payments on our debt, but that without raising the ceiling, we will soon be unable to actually pay off our obligations, even WITH deficit reduction measures. I found a republican oriented link for you to help explain this.
Do I understand that S&P made a statement that used $4 trillion as an approximate measure that sends a particular signal, and wasn't a set hard and fast as anything equating recovery or safety? Yes. I do. That being said, do I think that this number, thrown out during a press conference as a "good start" is something risking the market fallout from not coming to an agreement and not being able to pay our obligations? No, I don't.
Lastly, no one is proposing only $1 trillion in cuts (that number has been bandied as it was Obamas suggestion of revenue from taxes as part of his semi-vague $4 trillion proposal), and yes, I'm proposing that rather rather than FORCING a crisis now, we should take steps in working towards eliminating debt and getting to a balanced budget (as, you know, Clinton did), while avoiding potentially large consequences that could easily be avoided.
Excellent point. Perhaps this is why the Democrats haven't given up more in spending cuts. If neither side really belies the deadline there is no incentive to make a deal.
I disagree simply because there is no way you get a bill that makes everyone but the tea party happy. The fact that any house bill comes from Republicans would be enough for the Democrats to oppose it. Meaning the only viable path they havein the house is one that has the support of all Republicans. I don't know the numbers though. I think the tea party contingent is larger than we would expect.
I don't like the speaker's strategy in general. His hope is it's the furthest along at the end of the day. Then if the senate kills it they are killing the last hope to best the deadline. I think in this scenario the senate still votes it down. They know that they can blame Republicans either way.
not soon, eventually. all it means is that we'll have to cut back on government and give federal workers time off, unpaid. we can go back to bush spending levels and this will all go away.
We'll have plenty of time to make additional cuts before there's the slightest chance of not making our "obligations"
well isn't the threat of losing our rating the source of all the fuss? it's their judgements that's the supposed matter...
boehner and reid...
Ryan's the only one to put anything remotely in the ballbark ON PAPER.
and borrow another trillion or two... business as usual...
I don't understand thinking that the Republicans are the ones causing all the trouble here. The Senate leadership and the President have both said they will not sign the House's bill without even looking at it. It seems reasonable to say that both parties are equally bullheaded about this, and nonsensically so.
We're more or less in agreement on the other things, but I wanted to clarify my position. I don't think there is a place where everyone but the teaparty is happy, but on this issue, I feel like there is a pretty clear divide of where the tea party will not compromise and where the dems won't compromise, and I don't think that this is something that can be worked past. If you exclude the tea party from the equation, however, I think that there is a middle ground that would leave both the majority of dems and reps unhappy, but willing to vote for it. Boehner, however, is not willing to consider that as an option (though I think that he is in that middle section that would come to a decent compromise).
You're right, however, that the bill being republican is essentially enough to get democrats against it. More fun political posturing BS.
can someone at least riddle me this: what's the point of a deadline to default if it can be moved (seemingly) arbitrarily?
wasn't there a deadline in May?
wasn't there a deadline in July?
we can go back n' forth all day long about who's to blame based on the politics of waiting for the other side to blink first.
but if there's one thing the Democrats are losing credibility on, it's demanding a deal within a time frame that has already come and went. twice!
is the deadline actually based on default or is it merely the time when Moody's can no longer keep our credit rating at AAA? or does it have nothing to do with either??
I'll be the first to admit that this aspect of the negotiations makes absolutely no sense to me. my research doesn't seem to yield any concrete answer one way or the other.
example: http://news.yahoo.com/default-deadline-truly-aug-2-analysts-no-000349079.html
wasn't there a deadline in May?
wasn't there a deadline in July?
we can go back n' forth all day long about who's to blame based on the politics of waiting for the other side to blink first.
but if there's one thing the Democrats are losing credibility on, it's demanding a deal within a time frame that has already come and went. twice!
is the deadline actually based on default or is it merely the time when Moody's can no longer keep our credit rating at AAA? or does it have nothing to do with either??
I'll be the first to admit that this aspect of the negotiations makes absolutely no sense to me. my research doesn't seem to yield any concrete answer one way or the other.
example: http://news.yahoo.com/default-deadline-truly-aug-2-analysts-no-000349079.html
Here's a linguistics question for you: what exactly does "defaulting" mean and why is it called that? Since that kind of sounds like:
Code:
if (USA.Money + AllowedOverhead < Debt)
USA.Money = USA.default.Money;
Because the date's given are not dates of default (and the politicians and media are idiotic in continuing to claim such.) Default has a precise definition. "In finance, default occurs when a debtor has not met his or her legal obligations according to the debt contract, e.g. has not made a scheduled payment, or has violated a loan covenant (condition) of the debt contract. A default is the failure to pay back a loan. Default may occur if the debtor is either unwilling or unable to pay their debt."
What these dates are are the Treasury's estimates of when, if things continue as they are, the governments tax revenues + borrowing capability < their expenditures. In other words, it is when they have spent more than they have taken in and borrowed. Default would occur if on this date, they stopped making interest payments on existing debt. But this is not what a sane government would do in this scenario. Instead, since they will still be getting tax revenue, they will have to cut payouts to non-debt obligations such as the states, employees, social security etc and continue making their interest payments.
Think of it this way. You have a credit card with a limit of $10000. You make $1000 a week. You live an opulent lifestyle and spend $1500 a week. The extra $500 you put on your credit card. You check your credit card balance and see that you have a balance of $9500 so you realize that next week is a special day and you circle it on your calendar. You call your credit card company and say "hey, could you bump my credit limit up to $13000?" They take a look at your credit report and say no, we are not stupid, we will be lucky if we can get the $10000 back without having to go through collections. So that date you circled on your calendar comes around but do you default on that date? No. You continue to pay the minimum payment of $100 on your credit card bill and cut other expenses (luxuries before necessities) so that you spend $1000 per week instead of $1500.
Your high credit utilization rate is going to drop your credit score no matter if your credit card companies ups your limit or not. Nows as good a time as ever to start living withing your means.
The government is no different. We should get our credit rating downgraded whether or not the debt limit is increased. I'm hoping the limit is not increased so that congress will finally actually have to make the necessary cuts to our unconstitutional and bloated government. Everything from our hundreds of foreign bases and half a dozen or so "kinetic military operations" / wars to unconstitutional departments such as energy, education, commerce, etc.
If you are willing to devote an hour to a podcast explaining the ins and out I recommend the latest econtalk.
Last edited:
LOL @ Polychron.
Bill & Jobs did not think it through.
When the USA finally defaults on all it's loans.
The old USA FIAT money will be changed to the new USA FIAT money.
Billionaires will then only be millionaires
Bill & Jobs did not think it through.
When the USA finally defaults on all it's loans.
The old USA FIAT money will be changed to the new USA FIAT money.
Billionaires will then only be millionaires
hey you're preaching to the choir now.
no one ever brings up the defense budget... which is fucking absurd.
wait, he makes the same argument I've been making all along but throws in military cuts and now it's all crystal clear to you?
like I've been saying, our debt obligation is just under $30billion. Our tax rev. is , depending who you believe, anywhere from 170 to 250. A small fraction keeps us from default. End of story. No matter who's numbers you use, we can still pay SS, medicare, military, and a few others and still have some left over. We just have to cut big gov. down. Either that or we borrow more and dig ourselves deeper.
Keep in mind that with our baseline budgeting (laws to keep pace w/ inflation etc), with no new spending, our debt goes up another 7 trillion by 2020. That's why these bills of cutting 1 or 2 trillion, over 10 yrs, are worthless.
One thing I disagree on w/ MÆST is that I don't think it'll be a good thing to get downgraded. That could screw up new loans and really put a damper on our fragile housing market.
Last edited:
