America is on the verge of bankruptcy

[yota691]

America is on the verge of bankruptcy

WASHINGTON - «life», Reuters, AFP

Sunday, February 9th, 2014

The United States has returned to work after the roof of the public debt ended the freeze imposed by Congress a few months ago on that in order to prevent the failure of the country for payment and access to the brink of bankruptcy, which means the return of this danger. The Democrats and Republicans in Congress, Different priorities for budget items which led to a serious financial crisis in the country in October (October), reached the day the agreement is temporary suspended whereby work until 7 February, a day before yesterday, the upper limit allowed law of the federal government to borrow.

And over this period and has become the country needs a new agreement raises the debt ceiling of about $ 17.3 trillion dollars, to enable the state of the federal borrowing to meet its financial obligations and service its public debt. While waiting to reach a new agreement would seek the Treasury Department to take «extraordinary measures» to avoid the occurrence of the country in the event of failure to payment and insurance margin move postpone the crisis until the end of February, according to what has been written and Treasury Secretary Jacob if in a letter to congressional leaders.

Lu said in his letter: «because of the failure of the Congress to be a reaction to the Treasury Department to begin applying the exceptional measures will allow us to protect the ability to borrow and enjoy their confidence, which the United States and the ability to pay our bills as well».

The focus of these procedures, especially technical, to stop the issuance of treasury bonds ministry dedicated to municipalities, states and in order not to increase the debt of the federal state.He added that if these measures will enable the Treasury to continue until 27 February, warning that the ministry after this date will not only have «the money in their vaults» in order to meet its financial obligations.

Lu said earlier this week that «without the ability to borrow very quickly, it will not be possible face of the financial obligations of the federal state». He stressed that «a mistake to wait until the last minute». He warned that if political differences about religion would have a negative impact on the economy.

And last fall, the federal administrative agencies were closed for more than two weeks because of a dispute between Congress and the White House regarding the budget and the debt ceiling. It considered the Commerce Department intake staff Alfederaleon who lost for the duration of the closure of departments assigned 0.3 point from U.S. economic growth in the last quarter of the year, which amounted to 3.2 percent.

In the summer of 2011, paid the previous crisis regarding the debt ceiling credit rating agency «Standard & Poor's» to deprive the United States of classified top grade «AAA», which represents the maximum guarantee solvency in the markets. However, the credit rating agency «Moody» confirmed Wednesday that the return of the public debt ceiling crisis in the United States on Friday does not constitute a «threat» to the solvency of the country. It pointed out that the return of «legal limit of indebtedness does not represent a significant threat to the ability of the government to ensure payment obligations associated with its debt». The Agency continues to give the United States the maximum degree of solvency (AAA) attached to a stable economic prospects.

 

[dog53]

America is on the verge of bankruptcy 

 

 

 

 

 

hmmm I guess its the one thing the GOVT and I have in common. 

[DinarMillionaire]

It's already bankrupt.

btw...is it just me or does this read like it was written by an Iraqi or translated from Arabic?

[yota691]

It's already bankrupt.

btw...is it just me or does this read like it was written by an Iraqi or translated from Arabic?

Yep Yep...

[yota691]

http://youtu.be/RZpq0uPQZDM

[Butifldrm]

Lew Urges Debt-Limit Rise as U.S. Nears Borrowing Ceiling

 

Monday, 10 February 2014 | 00:00

 

 

 

 

 

 

 

Treasury Secretary Jacob J. Lew urged Congress to raise the debt ceiling as soon as possible, saying U.S. borrowing authority may not last past Feb. 27.

Extraordinary measures begun by the Treasury to remain under the debt limit “are likely to be exhausted in less than three weeks,” Lew said yesterday in a letter to House Speaker John Boehner, an Ohio Republican.

House Majority Leader Eric Cantor’s schedule for votes for next week includes possible consideration of legislation related to the debt limit. No bill has been introduced.

House Republicans say they want concessions in exchange for raising the debt limit, though they’ve been unable to agree on exactly what. Options include averting cuts in doctors’ Medicare payments and restoring cost-of-living adjustments for military retirees that were reduced in a December budget deal, said three House Republican aides who sought anonymity.

A suspension of the U.S. debt limit, enacted by Congress in October, expired yesterday. Lawmakers haven’t ruled out a debt-limit boost without conditions if Republicans can’t get enough support for a plan.

“It would be a mistake to wait until the last possible minute to act,” Lew said in his letter to Boehner. After the extraordinary measures run out, any “cash balance would be exhausted quickly,” he said.

Congress plans to be out of session the week of Feb. 17 and will return to Washington the week of Feb. 24.

Business Groups

Business groups are encouraging lawmakers to act to raise the debt limit. Democrats including President Barack Obama and Senate Majority Leader Harry Reid of Nevada insist that it be raised without conditions.

“Any default by the federal government on its debts would cause devastating, long-lasting effects for all Americans,” the Business Roundtable, which represents major U.S. company chief executive officers, wrote in a letter to congressional leaders released yesterday.

Taking the government “to the precipice would foster uncertainty, dampen consumer and business confidence, risk higher borrowing costs, and could have immediate consequences for hiring and investment,” wrote Randall Stephenson, chairman of AT&T Inc. (T), and Louis R. Chenevert, chairman of United Technologies Corp. (UTX)

Stephenson is president of the Business Roundtable and Chenevert leads the group’s tax and fiscal policy panel.

Market Reaction

The Treasury Department suspended sales of its state and local government series of non-marketable securities yesterday. The securities, called “slugs,” are sold to states and municipalities so they can comply with U.S. tax laws and arbitrage rules when they have money to invest from their issuance of tax-exempt bonds.

After the extraordinary measures run out, the Treasury will be left with about $50 billion in cash, Lew said.

“That number, however, could be materially higher or lower, depending on the pace of tax refund filings,” Lew said. “In previous years, the Internal Revenue Service has issued as much as $10-15 billion in refunds on a single day and nearly $40 billion in a single week.”

Lew said government expenditures can be as high as $60 billion on certain days.

Insurance against five-year Treasury notes fell to 27.5 basis points yesterday, matching its lowest level of 2014. The value rises with the perceived risk of U.S. debt and falls if it’s deemed a safer investment. One basis point equals $1,000 annually on a contract protecting $10 million of Treasury debt.

Insuring Bonds

The cost of insuring the bonds spiked almost 110 percent in the month before hitting a one-year high of 45.5 basis points on Oct. 4, 2013, as investors grew worried about a U.S. default during the 16-day partial government shutdown.

Republicans haven’t been able to find enough votes for several plans floated in the past week as conditions for raising the debt limit.

Representative Mac Thornberry, vice chairman of the House Armed Services Committee, said Feb. 6 that the idea of restoring military benefits probably wouldn’t be included in a final measure because the change would increase debt.

Other options, since abandoned, included repealing an insurance provision of the Obamacare health-care law and mandating approval of the TransCanada Corp. Keystone XL pipeline.

‘No Reason’

“Once again, Republican inaction and delay is threatening the full faith and credit of the United States,” House Minority Leader Nancy Pelosi, a California Democrat, said in a statement yesterday responding to Lew’s letter. “There’s simply no reason to play political games with the debt ceiling.”

A debt-limit increase without conditions would need a significant number of Democratic votes.

“We’re still looking for the pieces to this puzzle,” Boehner said Feb. 6, joking that he’d have trouble finding enough Republican votes for a debt-ceiling increase even if sainthood for Mother Teresa were attached.

“We need Democratic support in order to pass it,” he said. “We’ve got broad support in our caucus, but I don’t think we have 218 votes.” 

Source: Bloomberg

http://www.hellenicshippingnews.com/News.aspx?ElementId=74ac2a13-e422-4d76-bca6-b5ef6453df79

[Erebus]

The future is bleak for the USA...look up Jim Sinclair blog for what's really happening....