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China official: GOP ‘playing with fire’ with debt ceiling
There’s been an interesting warning on the debt ceiling today — from China.
Li Daokui, an adviser to the People’s Bank of China, told reporters in Beijing, “I think there is a risk that the U.S. debt default may happen.” And he puts the blame on congressional Republicans. “The result will be very serious and I really hope that they would stop playing with fire,” he said.
China is no disinterested party: It holds more than $1 trillion in Treasury debt as of March.
President Obama may well agree with the Chinese banker’s sentiment, as he urges Congress to go ahead and raise the nation’s $14.3 trillion debt ceiling.
Technically, U.S. obligations have already risen past that ceiling, but the Treasury Department says it can use accounting maneuvers to keep paying bills until Aug. 2.
Congressional Republicans, including those who control the U.S. House, say they won’t agree to a debt ceiling increase unless the White House and Democrats agree to major spending cuts.
The two sides are negotiating — as the world waits.
“I really worry about the risks of a U.S. debt default, which I think may lead to a decline in the dollar’s value,” Li said.
US deficit up 15.7% in first half of fiscal 2011
AFP
WASHINGTON — The US budget deficit shot up 15.7 percent in the first six months of fiscal 2011, the Treasury Department said Wednesday as political knives were being sharpened for a new budget battle.
The Treasury reported a deficit of $829 billion for the October-March period, compared with $717 billion a year earlier, as revenue rose a sluggish 6.9 percent as the economic recovery slowly gained pace.
The Treasury argued that the pace of increase in the deficit was deceptive because of large one-off reductions in expenditures made during the first half of fiscal 2010, compared with previous and subsequent periods.
Those included a $115 billion reduction in funds spent on the Troubled Asset Relief Program (TARP) — the financial institution bailout program — in March 2010.
But 2011 so far has also seen significant increases in spending on defense, Social Read more…
Pressure on Portugal After New Credit Downgrade
LISBON — Portugal’s borrowing costs pushed higher after Moody’s downgraded the country’s credit rating, stoking the pressure on the country’s beleaguered minority government.
The yield on Portugal’s ten-year bond rose 0.04 percentage point to 7.44 percent. The equivalent yields for Greece and Spain, two other euro countries struggling with high borrowing levels, were down modestly.
Moody’s Investors Services cut the country’s rating by two notches to A3 late Tuesday, saying the debt-stressed country is struggling to generate growth and faces a tough battle to restore the fiscal health needed to calm jittery financial markets.
Prime Minister Jose Socrates said late Tuesday he would quit if Parliament doesn’t consent to his government’s latest batch of contested austerity measures.
Portugal aims to raise up to €1 billion in a sale of Read more…
Shocking! Unemployment shoots to 17.3%
© 2011 WorldNetDaily
Editor’s Note: The following report is excerpted from Jerome Corsi’s Red Alert, the premium online newsletter published by the current No. 1 best-selling author, WND staff writer and senior managing director of the Financial Services Group at Gilford Securities.
The Bureau of Labor Statistics appears to be intentionally understating the current unemployment rate, most likely with an aim to bolstering the Obama administration’s claim that the unemployment rate is improving as jobs are created in a recovering economy, Jerome Corsi’s Red Alert reports.
In a news release on Feb. 4, the unemployment rate was reported to have fallen 0.4 percent to 9.0 percent in January 2011, even though only Read more…
Highlights of the $3.73 Trillion Budget Request for 2012
WASHINGTON—President Barack Obama released a $3.73 trillion budget for fiscal-year 2012 Monday where he sought to balance two competing and conflicting agendas: dramatic cuts to federal spending while also investing in programs to improve U.S. competitiveness.
A look at what President Barack Obama has requested in his $3.73 trillion budget for the 2012 fiscal year beginning Oct. 1.
Summary: Homeland Security gets $44 Billion with a priority on naked body scanners. The Transportation Department gets over a half Trillion dollars for new highway and rail construction, including $53 billion for high-speed trains. $500 million will go to the new Bureau of Ocean Energy Management and Enforcement (See my article on LOST.) and NIST, the group that dropped the ball on the Sept. 11th investigation will be getting $764 million, roughly a 17% increase from last year.
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Agency: NASA
Spending: $18.7 billion
Percentage Change from 2011: 0.9 percent decrease
Discretionary Spending: $18.7 billion
Highlights: Obama’s space budget is about the same as the previous year, avoiding the major proposed cuts other agencies are facing, partly because of the long planned Read more…
Economist: United States Worse Off than Greece
Kurt Nimmo
Infowars.com
Dr. Laurence Kotlikoff is an economics professor at Boston University. He says the Treasury and the government are fudging the national debt numbers. Kotlikoff says the United States is bankrupt and we don’t even know it.
During his SOTU address, Obama called for a freeze on discretionary spending. He called for a five-year freeze on non-mandatory domestic spending, a proposal he estimated would save $400 billion over the next decade.
He said entitlements like Medicare, Medicaid and Social Security will need to be reformed without mentioning specifics. In other words, the government is thinking about cutting these programs to the bone. Boomers will be eating dog food after their pensions are stolen and the entitlement Ponzi scheme breaks down. Read more…
U.S., Japan told time running out to deal with debt
IMF warns Japan and United States on need to tackle debt
* Politics make reining in U.S., Japan deficits difficult
* S&P downgrades Japan, sees no strategy to handle debt
* Bond markets calm on Friday, Japan vows fiscal discipline (Adds bullet points)
By Tetsushi Kajimoto and Lesley Wroughton
TOKYO/WASHINGTON, Jan 28 (Reuters) – Japan and the United States faced new pressure to confront their swollen budget deficits as the IMF and rating agencies demanded more evidence they can bring their public debts under control.
The International Monetary Fund said the G7’s two biggest economies needed to spell out credible deficit-cutting plans before the markets lose patience and dump their bonds.
On Friday, Japan’s Prime Minister Naoto Kan vowed to push ahead with tax reforms aimed at curbing the country’s debt, but an uncooperative opposition and divisions within his own party on policy make the chances of success slim.
“The important thing is to maintain fiscal discipline and ensure market confidence in Japan’s public finances,” Kan, who took over in June as Japan’s fifth premier since 2006, told parliament’s upper house.
Ratings agency Standard & Poor’s cut Japan’s long-term debt rating on Thursday for the first time since 2002, and hours later Moody’s Investors Service warned the risk of the United States losing its top AAA rating, although small, was rising. Read more…
Record U.S. deficit projected this year
The still-fragile economy and fresh tax cuts approved by Congress last month will drive the federal deficit to nearly $1.5 trillion this year, the biggest budget gap in U.S. history, congressional budget analysts said Wednesday.
The grim forecast from the nonpartisan Congressional Budget Office came hours after President Obama called in his State of the Union address for Republicans and Democrats to work together to rein in record deficits that are pushing the national debt into uncharted territory. At $1.5 trillion, the deficit would equal 9.8 percent of the economy, the CBO said, making it one of the largest by that measure since the end of World War II.
Lawmakers scrambled on Wednesday to respond to the darkening budget picture, with Republicans pressing their call for sharp and immediate cuts in domestic spending. Twenty-one Senate Republicans, meanwhile, unveiled a plan to amend the Constitution to require balanced budgets, a top priority of the tea party movement.
Democrats resisted both initiatives, arguing that amending the Constitution, a lengthy process that requires a vote in all 50 state legislatures, would do little to address the current problem. They dismissed as “drastic” a proposal by House Republicans to slash $100 billion from the current budget, arguing that cuts of that magnitude would endanger a million jobs on public- and private-sector payrolls at a time when the unemployment rate already stands at 9.4 percent.
“We have to cut government, but Republicans are going at this with meat ax when what is needed is a Read more…
Empty Store Shelves Coming to America
The National Inflation Association today issued a warning to all Americans that empty store shelves will likely be coming to America as a result of government price controls during the upcoming hyperinflationary crisis. This morning, NIA released a video preview of what hyperinflation will look like in the U.S. This extremely important must see video is now available on NIA’s video page.
NIA’s six-minute video released today goes into detail about an event that took place just outside of Boston, Massachusetts in May of this year. This story was widely ignored by the nationwide mainstream media, but NIA believes it was one of the most important news events of the first half of 2010. Although this particular crisis in Boston was due to decaying infrastructure, NIA believes a currency crisis will lead to the same type of panic on a nationwide basis.
NIA hopes that this video serves as a wake-up call for Americans to take the necessary steps to prepare for hyperinflation and become educated about the U.S. economy. In Zimbabwe during hyperinflation, Zimbabweans were forced to transact in gold and silver. It’s only a matter of time before the U.S. dollar becomes worthless and the only Americans with wealth will be those who own Read more…
National Debt $200 Trillion Dollars
Dr. Laurence Kotlikoff economics professor at Boston University, discusses the national debt and unfunded liabilities – Aug. 11, 2010
Using CBO data, Kotlikoff says the real national debt is $202 trillion.
Compare the official deficit numbers for July – $165 billion – with the numbers for all of 2002 – where $165 billion covered the deficit for the entire fiscal year.
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Excerpt:
The Congressional Budget Office whose Long-Term Budget Outlook, released in June, shows an even larger problem.
‘Unofficial’ Liabilities
Based on the CBO’s data, I calculate a fiscal gap of $202 trillion, which is more than 15 times the official debt. This gargantuan discrepancy between our “official” debt and our actual net indebtedness isn’t surprising. It reflects what economists call the labeling problem. Congress has been very careful over the years to label most of its liabilities “unofficial” to keep them off the books and far in the future.
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