US Debt ceiling looming in the next couple of days…..
U.S. Congress will be debating on September 30th 2013, to pass a federal budget pertaining to U.S. Debt 2013 and increasing the “US debt ceiling limit”. This scenario reminds me of U.S. Treasury Secretary Timothy Geithner plea to the senate back in January 2013 and to increase the “debt limit” …otherwise military salaries will be affected, Social Security payments etc.
Once again another Us Debt Crisis scenario is lurking behind the scenes…as the drama unfolds, similar to the FED debate to “taper or not” via the infamous “Bernhamlet”. The hype was building for months and what we found out, no tapering..for now??? This issue is identical, the US Federal Reserve Bank will not allow U.S. Congress to halt the “digital printing” press…as the U.S. economy cannot survive without the continual stimulus flow. Geithner, Bernhamlet, Yellen…the “song remains the same” as the famous line from Led Zeppelin. Status quo is here to stay and expect no change coming up this week.
Overall, if we assess the overall U.S. economy and the use of stimulus, by adding more to their debt has not changed U.S. government or administration policy. In fact, since 2008, the Big banks, Wall St have not changed their business model…if the Fed is not willing to change their monetary policy of continual injection…why would the world expect anything new from the U.S. Congress??
Regardless of how Moody’s rates the outcome…the bigger concern for the U.S. administration is how will the BRIC nations react? Currency wars are amongst us as Jim Rickards (author of the National bestseller “Currency Wars”) and how will those nations respond to this current U.S. issue?