From Zero Hedge:
And from the relentless shock and awe happening abroad every single day, we briefly turn our attention to the total financial chaos domestically. Following the settlement of $67.6 billion in debt from last week’s auctions, the Treasury managed to raise its dangerously low cash to a level that will give Tim Geithner pocket change for another week, or $99.5 billion. Alas, the cash buffer came at a price: total debt increased from $14.166 trillion to $14.238 trillion. As a reminder, the debt ceiling is $14.294 trillion, so on a pure basis there is a $56 billion buffer or less than one’s week’s worth of auctions…
It goes on to note that with this, that and the other fiscal rabbits Timmy can pull out of the hat, we’ve got about 6 weeks of money in the Treasury at the moment. Boys and girls, the United States isn’t living paycheck to paycheck, we’re living from payday loan to payday loan…and goodness knows what will happen if, say, a revolutionary ferment or gigantic natural disaster out there dries up the cash of those who buy US bonds. We’re teetering on the brink of disaster – and the way out is for massive reductions in spending…just returning us back to FY 2008 levels of spending (hardly a tight fiscal year for the United States, you know) would ease the pressure. Returning us to 2004 levels of spending would balance the budget (and, once again, it wasn’t like we were being financially sober in 2004).
But, howls of pain arise in Democrat quarters if we even try a mere $60 billion in cuts… I do wonder if the people in DC (aside from a very few who are seeing things clearly) fully understand our condition? We are really out of money – we are just one bad natural disaster or one financial meltdown away from national default. Earthquake in California, Katrina-style hurricane in the Gulf, Chinese meltdown because of inflation and property bubble bursting…and that is it; there won’t be enough money in the world to buy the bonds we’ll need just to keep the lights on.
It was once observed that great empires and little minds go ill together…and here we are, facing bankruptcy and our President divides his time between golf and NCAA brackets…I feel a bit worried, these days.
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