Study: US could default as early as Oct. 18

[Zippyjuan]

http://enews.earthlink.net/article/pol?guid=20130910/90e96eaf-b14f-46cc-a766-811f859eb730

WASHINGTON (AP) — The United States could default on its obligations as early as Oct. 18 if Washington fails to agree on legislation to raise the government's borrowing cap, a new study predicted Tuesday.

The Bipartisan Policy Center analysis says the default date would come no later than Nov. 5 and that the government would quickly fall behind on its payments, including Social Security benefits and military pensions.

The think tank's estimate is in line with a warning last month by Treasury Secretary Jacob Lew that the government would exhaust its borrowing authority by mid-October and be left with just $50 billion cash on hand.

The government has never defaulted on its obligations. Raising the $16.7 trillion borrowing cap promises to be a major struggle for House Republicans and President Barack Obama.

Two years ago Obama agreed to pair a $2.1 trillion increase in the debt limit with an equivalent amount in spending cuts spread over 10 years. But the president now says that he won't negotiate over the debt limit and is asking Congress to send him a straightforward increase that would ensure the government can pay its bills.

In January, House Republicans permitted an increase in the debt ceiling without demanding offsetting spending cuts.

It's commonly agreed that failure to increase the debt limit on time would roil financial markets and lead to a downgrade of the government's credit rating. The political fallout would also be intense, especially if Social Security benefits are delayed.


Tuesday's study predicts that if the default date — which is when the government cannot pay its bills in full and on time — comes on Oct. 18, the subsequent Social Security payments due on Nov. 1 could be delayed by almost two weeks.

 

[ClydeCoulter]

"Social Security benefits and military pensions"

They always threaten these because it gets personal. Bring the troops home.

And sell off a lot of military assets to private citizens, keeps them in the defense department (citizens), including all those bullets that DHS has been buying up!

 

[Zippyjuan]

Social Security is also where the big bucks are. True, it is also a useful tool to get people to respond and put pressure to getting the problem solved. The costs of the troops in Afghanistan are under $200 billion a year while Social Security accounts for nearly four times that much. Agreed we need to save money on both.

 

[UtahApocalypse]

In the real world we defaulted 16 trillion dollars ago

 

[Madison320]

My guess is they'll undo the sequester and trade it for "cuts in the future".

Or maybe they'll just cancel the debt ceiling for another 4 months like they did last time. If they do that, watch out.

 

[jllundqu]

The won't cut squat. They will raise and raise and raise. Obama knows that if people start missing some checks in the mail like Soc Sec and VA payments, the blame will fall squarely on GOP.

The whole process screwed. Absent some cataclysmic event in the next 2 months, nothing changes. The spice must flow.

 

[Chester Copperpot]

Yeah if they default on our debt that becomes the politicians' choice to default... They could just as easily give up their salaries or cut some other programs

 

[RickyJ]

If the US gets to default then I am going to default too. At least then I should have the same credit ranking as the US government.

 

[Zippyjuan]

Yeah if they default on our debt that becomes the politicians' choice to default... They could just as easily give up their salaries or cut some other programs

Cutting congressional pay would be only a symbolic but not really meaningful reduction in debt. $174,000 a year times 50 senators and 435 congressmen comes to $84 billion a year. Deficit for this year is estimated to be about $650 billion or about $1.8 billion a day.

 

[GunnyFreedom]

November-December 2014 to January 2015 is my window of expectation, and has been since the end of 2009.

 

[Occam's Banana]

My guess is they'll undo the sequester and trade it for "cuts in the future".

Or maybe they'll just cancel the debt ceiling for another 4 months like they did last time. If they do that, watch out.

The won't cut squat. They will raise and raise and raise. Obama knows that if people start missing some checks in the mail like Soc Sec and VA payments, the blame will fall squarely on GOP.

The whole process screwed. Absent some cataclysmic event in the next 2 months, nothing changes. The spice must flow.

Whatever happens, I'm pretty sure we're gonna need a bigger rug ...

 

[Crystallas]

Whatever happens, I'm pretty sure we're gonna need a bigger rug ...

And the money to buy such an extremely large rug.

 

[Christian Liberty]

November-December 2014 to January 2015 is my window of expectation, and has been since the end of 2009.

Why then in particular?

For someone who has a couple thousand in savings bonds (For college) when do you suggest cashing them all in?

 

[GunnyFreedom]

Why then in particular?

Because they have a lot of resources with which to prop up a failing dollar, specifically QE and then off-shoring the QE into the petrodollar, and silver shorts. Those resources are not quite exhausted but they are awful close to it. Whatever power is in place, in this case Obama and a Dem Senate, will do anything and everything in their power to put the pain off until after the 2014 mid-terms. They are already at the ragged edge, so the desperate moves to come over the next 14 months will be astounding in scope, but will leave us with climbing price inflation but no real collapse (I believe) until we get past the 2014 election.

For someone who has a couple thousand in savings bonds (For college) when do you suggest cashing them all in?

I wish I knew what to tell you there. If I had something like that I'd have poured them into PM's a month or so ago when silver was under $20. Now, I really don't know. I think we will see some significant price inflation as we move into 2014 Q1-Q2, accelerating into Q3 while the DOW skyrockets and the talking heads insist that the recession is now officially over, but the Joe on the ground goes hungry and homeless. We make it past the November 2014 election and the whole house of cards starts coming apart.

 

[oyarde]

My guess is they'll undo the sequester and trade it for "cuts in the future".

Or maybe they'll just cancel the debt ceiling for another 4 months like they did last time. If they do that, watch out.

Why would I think they would not just push it off , again ??

 

[puppetmaster]

Social Security is where,the big bucks are. True, also a useful tool to get people to respond and put pressure to getting the problem solved. The costs of the troops in Afghanistan are under $200 billion a year while Social Security accounts for nearly four times that much. Agreed we need to save money on both.

Plus the savings of removing troops and bases elsewhere not just Afghanistan and we could really save some money equal to SS. raising the debt limit does not solve the problem only slows the desease

 

[James Madison]

Cutting congressional pay would be only a symbolic but not really meaningful reduction in debt. $174,000 a year times 50 senators and 435 congressmen comes to $84 billion a year. Deficit for this year is estimated to be about $650 billion or about $1.8 billion a day.

By my calculation that would be closer to $84 million a year. That would fund the government for about two-and-a-half hours.

 

[devil21]

Social Security is also where the big bucks are. True, it is also a useful tool to get people to respond and put pressure to getting the problem solved. The costs of the troops in Afghanistan are under $200 billion a year while Social Security accounts for nearly four times that much. Agreed we need to save money on both.

How many problems get "solved" that arise again as the same problem a few months later? Solving means that it is no longer a problem. Want to "solve" it? Repeal all debt limit related legislation.

If I have to replace my car's transmission every year then I'm temporarily fixing the symptom, but not the problem. The reason that I keep killing transmissions is the problem to be solved.

 

[HOLLYWOOD]

Jacob "the Loser" Lew...


I did the calculations...between YTD(end of Oct 2013), Lew has borrowed out of not paying obligations(.gov pensions, treasuries, etc) of approximately: ~$520 Billion


These fuckers need a False Flag real quick.

 

[Christian Liberty]

I wish I knew what to tell you there. If I had something like that I'd have poured them into PM's a month or so ago when silver was under $20. Now, I really don't know. I think we will see some significant price inflation as we move into 2014 Q1-Q2, accelerating into Q3 while the DOW skyrockets and the talking heads insist that the recession is now officially over, but the Joe on the ground goes hungry and homeless. We make it past the November 2014 election and the whole house of cards starts coming apart.

I wanted to invest in gold, but my family wouldn't really let me do it...

Mind you, I'm 18 so I guess I could tell them to screw off, but considering I live with them, I'd really rather not do that, at least not if I don't have to.

They're not nearly as worried as they should be about the stability of the economy. Mind you, they know its a mess, but still...

I don't know...