Treasury Says Anything But A Debt Ceiling Hike Would Lead To Default, As M.A.D. Escalates A Notch

www.zerohedge.com...

The US dollar is going to blow up thanks to idiots that believe in government.

People need to shift focus into survival mode.

Once the government unleashes total chaos upon us, it will be every man for himself as all voluntary trade between individuals is shut down due to the total destruction of the money supply.

The Treasury is not going to allow a default and the Congress is not going to cut spending.

Ergo, the Fed is going to be directed to print the money, and if they refuse, they will be taken over and the money will be printed anyways.

Businesses will implode

Chaos will reign supreme as grocery stores refuse to sell products in dollars.

Chaos will reign as farmers refuse to sell crops for dollars.

Chaos will reign as the 40 million people on food stamps realize their crappy debit cards no longer buy a loaf of bread.

There will be total unmitigated chaos.

Good, let it collapse.

Hehehehehehe.

mnemeth, what is the M.A.D. stand for? I did not see it in the article.

I think they could sieze the fed,after all they got the guns. There are options,the most favorable of all is to declare the fed dead! Nationalize the notes pay your foriegn debts,remove the burden of debt the people owe as interest payments and begin to replace fed reserve notes with debt free currency. There are options when you have the worlds most advanced military behind you,as long as you take care of the people first,the other options,not so pretty.

Regardless I do feel scary bad things could happen,as long as I can make two more weeks,I'll be stocked up for several months then its go time, bring it on,but please wait two weeks for me to finish my prep work.

reply to post by saltheart foamfollower


MAD is mutually assured destruction. This is the reason why there have been no large scale wars between the super powers, everyone dies. The same principle is going on within the economy between the corporations and the people. Without the corporations people have no resources, with out the people the corporations have no resources. Corruption is rife and a razor gang needs to go in and get rid of the dead weight. A lack of transparency to the accounts and budgets is compounding the problems as no one has an accurate picture of what is really going on. What everyone can agree on is that things are a mess and there are many competing forces and interests involved. They can either work together or kill each each other, one way or another this problems will get solved.

Originally posted by mnemeth1

Chaos will reign as farmers refuse to sell crops for dollars.

Not that I dont agree with all of the other chaos factors, as I do.

However that one, taken alone is coming to pass as we speak.

reply to post by kwakakev


NO, that only applies to nuclear weapons.

I asked that for a reason. Even though there is huge HATE for Beck, the first time I have ever heard of M.A.E.D was from Beck. He either came up with it or he got it from someone.

Mutually Assured Economic Destruction.

Now if you take the STATISTS theory, we always have to expand. What happens when the bubble is reached when the globe is controlled? No more expansion.

We have to SEE the whole truth not just segments of it.

Not saying you are wrong, just saying.

Still waiting for this all out chaos to happen. Is this going to happen this month, next month, this year or even next year?

to me, what he is saying basically, is that if we don't borrow more money, we won't be able to pay the interest on the money that we already borrowed.....since, that is what a default is!!
so, well, we as a country, should be able to pay to keep running, pay the interest on our debt, and pay a little of the debt....I mean, that would be true for any household...it's sound financial reasoning....
but, well, our gov't has been borrowing out the wazoo, to keep running, and now they are saying that they can't even come up with the money to pay the interest on this debt?? but, don't worry guys, we're recovering....things are getting better, go, spend, invest in wall street...please, pretty please, invest in wall street.....all is fine, no need to worry!!!

we have got to find a way to replace these guys with people who have brains!! if you don't have the money to pay the interest on the debt you have, well....you don't need to be giving yourselves raises, you don't need to be launching giant rockets into space with secret cargos, you don't need to be carrying on with two senseless wars, you don't need to be doing much of what you are doing!! and you don't need to be borrowing even more money to do all these things!

reply to post by dawnstar

we have got to find a way to replace these guys with people who have brains!!

If you trace where a good chunk of this money comes from, the Fed and where the interest goes, the Fed, then you see that they do have brains, just no conscious. If the Fed was part of the government and not a private company then these interest payments would not exist. The privatisation of the economy is just as much to blame as the other good points you raised.

Obama increased spending of the budget by 30% his first year in office. This is a deliberate attempt to destabilize the economy.
Folks, he wants this to happen!!!

This is what you get when you try to put in place a fascist economic policy based on the ridiculous idea of a free market.

Our huge debts were created by attempts to create a free market, and yet morons keep trying to blame government for the actions of the private banking sector.

Wake up and smell the coffee.

reply to post by beezzer


Obama cut a huge chunk out of the deficit his first year in office by attaching strings to the bailout money, GW eagerly gave the bankers before leaving office, (All of course with total republican backing).

Blaming Obama for the economy he inherited from GW is plain stupid.

PEOPLE I HAVE SOME SERIOUS WARNING TO SHARE WITH ALL:
=======================================================

I have done some scientific calculations regarding the US National Dept.

Well, In January 11, 2011 I went to usdebtclock.org website to check at the national debt clock information as of this date. It was: $13,945,560,948,891
The US would need to spend $354,439,051,108 more before hitting the debt ceiling and going to default.

ok, here's the deal, 30 days have passed, today is February 10, 2011 and the US national debt clock reads:
$14,134,161,465,734. So, this value minus the previous value gives us:
$ 188,600,516,842 that the US government has spend within *JUST* the past 30 days, and you all know what is worrysome? That the US government does *NOT* have enough money keep on debting it self for 30 more days based on current spending rate. This means that the US government has:
$ 165,838,534,266 credit available till reaching ceiling/defaulting. I see some where in March 10 where the ceiling will be hit possibly bankrupting the US dollar, or depreciating its value? or the treasury department just printing more money and hoping that the people some how didn't noticed any of this (after all, this is BARELY even mentioned in mainstream news).

So, I guess we have 25 to 30 more days to keep on living comfortably with such great living standards, and let's see what happens after US debt bubble explodes.

Oh, and by the way, if congress does approve the US debt ceiling hike, in my opinion, that will only postpone the inevitable, MAYBE UNLESS the US government stops spending like crazy and creating plans to start repayment of some of this debt.

That's all what I am going to say for now.

So people, start getting prepared for the worst, stock up on water, on non perishable foods, if you have the money to spend right away get solar panels because if the US economy goes bonkers you may end up without electricity. I recommend that you go for the solar panel that is as much efficient as possible space based, go for 120 watts 12V panel versions, (they are rectangular), you can get them in a really good price, specially at eBay, just that you will need alot of patience to price scourge for the lowest and high performance ones. If you opt to purchase USED panels to save on money, make sure that it is not listed as "defective".

If the US National debt does kaboom, that may set a chain reaction for other countries where things are dollarized or highly depends on the US dollars. I think that almost the whole world will suffer as a result of this.

Good luck, and I hope for the best.

Remember, March 05~15 or so is the date based on my scaled forecast based on the previous 30 days performance. Available spending amount is not even enough to double what US spent last 30 days, but if the US does slow down a little on its spending, then doom might happen like in march 10 to 15, if it does not slow down, expect doom in march 05 or a little sooner.

So people, start getting prepared for the worst, stock up on water, on non perishable foods, if you have the money to spend right away get solar panels because if the US economy goes bonkers you may end up without electricity.

Fear mongering.
That’s like yelling fire in a theater when someone is caught smoking.

You need to get a grip.
No one is going to shut down the water treatment plants.
The power plants will still produce electricity.
The grocery stores will still stock food.

Prices will go up. No big surprise there.

reply to post by samkent

really, this..."It's everyman for himself" bit isn't what I'd advise.
It's time to keep your little neck of the woods prepared.
Just in case.
Some of us expect that there will be a total collaspe of the world's economic system.
Most of us expect that there is gonna be a long stretch of bad times ahead.
Well, if a total collaspe occurs, I got news for yas......the US doesn't manufacture that much, and well, I live in an area that was once big in the textile industry. It's just a shadow of what it once was. The buildings have been torn down, converted into living space, the equipment left to rot and now gone. I can say the same thing about the apple orchards that once were plentiful in NY...they are just a shadow of themselves.
our communities, well, they are still gonna need clothes, they are still gonna want their apple juice.
Learn a skill that you think might be needed.
Make connections in your town, who grows the food, who can sew you a new pair of britches if you last paid rips out, who can make a cradle for your newborn? Try to set up a way for these people to get connected, support them, buy from them, start coopes so they can get be more competitive..
Learn about the barter system, what would work, what probably wouldn't.
Find a way for at least your local community to stay electronicallly connected, even if the internet is brought down.
And, connect with as many people, hopefully with leadership abilities, who would be willing and able to work towards quickly stabilizing your little area.

reply to post by CanadaMaster

Oh, and by the way, if congress does approve the US debt ceiling hike, in my opinion, that will only postpone the inevitable, MAYBE UNLESS the US government stops spending like crazy and creating plans to start repayment of some of this debt.

All of those people that won their seats with support of the Tea Party would have to be insane to support the debt hike. This is a crossroads of massive proportion. Either these folks stick to their word and stand up for the people that voted them in, or they switch and support the massive government that was already in effect. Either decision comes with massive consequences, and either way the political repercussions will likely end their careers, so what will they do?

Will they swallow the hard pill, keep their promises, and send us into hyper-inflation and possibly depression on a moral ground so that we can begin a "real" recovery?

OR

Will they cave into political pressure from the big parties, raise the ceiling postpone the inevitable another year, and energize the Tea Parties once again, except this time people might realize that just voting in new people is not enough for real change.

In my opinion, one result puts us into an economic dive, that will be catastrophic, but at least in protects the integrity of the Democratic process, while the other result proves the Democratic process is dead and civil unrest is imminent. They are choosing their poison, an economic one, or an Egyptian style one.

reply to post by getreadyalready


I would like to know what would be the consequence to the average joe if the US government defaults on its debt?

Would one US dollar all of the sudden be worth the same as like 10 cents is worth today? (massive devaluation)
Would all banks close and deny funds to its citizens?
What would happen to the regular joe that owns his house and is still paying mortgage over it?
What would happen to a typical person's job, specially if they are a city school teacher?
What would happen to food distribution supplies?
Would anarchy ensue?

All and even more questions worries me because I have family members living in the United States of America in New York City. My father is over there and he is a teacher and he owns his house, my sister is also there and she is planning on purchasing a condominium while I am here in Canada and own my own house and are paying mortgage over it as well.

I want as much information as possible regarding this subject, and potential outcomes so that I can relay it to my family members so that they can start preparing them self the best way possible, and also for my self incase if such issue also greatly would affect Canada.

it looks like we have less than 30 days to fully prepare if TS HTF by early march at current US spending rate.

At best, I hope that civil order stays stable, essential civil services remain operational, and the only entities that remain affected out of this is the ones responsible for wrongly spending. I dont want innocent people to get affected over this, its not the innocent people's fault that the US government is about to hit its debt ceiling.

.....I wonder if I am over worring my self over this (like a friend that I have tries to put it) and that nothing serious will happen to the regular civilian, and that life will continue normally, like if nothing happened?

reply to post by CanadaMaster


I don't think anybody knows for sure what the consequence would be if we default. The vast majority of our debt is owed to ourselves in the form of bonds. The 20 or 30% that is owed to foreign countries is really of no consequence. They aren't going to invade for it, so it will just sit there and accrue interest.

I'm sure it would crash the stock market, but that needs to happen anyway, because a large number of stocks are valued at 200 to 300% above what their numbers justify. Therefore seeing a 50 or 60% drop in the stock market although shocking, would be pretty appropriate.

I think for people with large investments or people about to retire, the effects could be catastrophic, but for the "average" American, I don't think a default on the debts would mean much, and in fact it would help us in the long run. That is why the middle class and ultra-conservatives want to see the crash. It is inevitable, and we want to get it over with and start to build a real economy based on real numbers instead of paper and bubbles.