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Posts Tagged ‘U.S. Treasury’

The Chinese government started stockpiling food 3 years ago: What has the US government been doing beside spending money we don’t have?

March 1, 2011 Comments off

nowpublic.com

I wrote this three years ago, when the Chinese were reportedly stockpiling food in their cities. The world economic and political situation has worsened. With rising food prices, massive unemployment, union protests and government debt driving states to the brink of shut down and bankruptcy, the situation has worsened–and we owe the Chinese more than ever. ED.

by Monica Davis

Rumor has it that the Chinese government is advising its cities to start stockpiling food and fuel.  The government news agency reports that the central government has told the largest cities to stockpile at least two weeks of food, until the world economic turmoil caused by the banking industry’s foreclosure woes slows down.  Lots of luck on that.

With China’s exposure in the twitchy American financial markets, it is no wonder that the Chinese are getting nervous.  They have a lot at stake in the American economy, as do many foreign investors, past and present.

In a historical analysis of foreign investment in the United States, one writer notes that: Read more…

U.S. Treasury Secretary Admits U.S. Default is Imminent

January 24, 2011 Comments off

By James West

Timothy Geithner, U.S. Treasury Secretary, admitted in a letter to congress dated January 6th, that the United States Treasury would be forced to default on its credit obligations without clearance from congress to raise the amount of money tha the treasury is allowed to borrow.

After citing a list of “extraordinary measures” congress has had to resort to int he past to avoid entering a state of defualt, Geithner stated, “Once these steps have been taken, no remaining legal and prudent measures would be available to create additional headroom under the debt limit, and the United States would begin to default on its obligations. The extraordinary measures include, “suspending sales of State and Local Government Series (SLGS) Treasury securities; suspending reinvestment of the Government Securities Investment Fund (G-Fund); suspending reinvestment of the Exchange Stabilization Fund (ESF); and determining that a “debt issuance suspension period” exists, permitting redemption of existing, and suspension of new, investments of the Civil Service Retirement and Disability Fund (CSRDF).

That the United States has already defaulted on its obligations is beyond dispute, at this point, as its the rate at which its debt service obligations is growing exceeds the rate at which the United States GDP could possibly grow, meaning that, without drastic cuts to governmenbt spending, the debt can only continue to grow.

Before our very eyes, the so-called leadership of the world’s largest economy is intentionally bankrupting the country and devaluing its currency in what can only be a precursor to rampant inflation. Since the integrity necessary to manage this problem does not exist within the United States political system, the rest of the world has no choice but to stand by and watch the value of their United States Treasury Bills diminish incrementally on a daily basis. Selling them will only exacerbate the problem, but the question must be asked, how long until the remedy is preferred over the miserable condition?

Geithner goes on to say, in a remarkable baring of the national soul,

However, if Congress were to fail to act, the specific consequences would be as follows:

The Treasury would be forced to default on legal obligations of the United States, causing catastrophic damage to the economy, potentially much more harmful than the effects of the financial crisis of 2008 and 2009. Read more…