Free counter and web stats


..There's a little Samuel Pepys in all of us..

Friday, July 29, 2011

Seems the GOP and the Democrats love dicing with death.. there will be a vote tomorrow in both Houses on the revised borrowing limits.. and should Barack fail to get some kind of plan in place, the US will default next Monday on it's debt load..
The devalued dollar is already holding up world markets.. as the Greenback falls so does confidence in the United States..
This is the only story that has any real impact at the moment.. Until we know that Obama's got to play with, the whole game stands still..

And as of late this afternoon, there appears to be no change in the hard-line stances taken by both the GOP and the Democrats.. No new vote has been called in either House as yet, and to complicate the matter, there's dissension in the ranks of the Republicans..
The Dow has fallen for the fifth day running, as slack-jawed Americans watch as their elected representatives play party politics with the country's future..
The default date is the 2d of next month, and while there are those who're saying this is just another crisis that will be averted at the last moment.. it's not completely sure what the Republican Tea Party will do here.. They've disregarded entirely the plan put forth by John Boehner, the leader of the Republican House of Representatives, with the hard-liners looking for gods know what in the way of concessions from Barack and his boys..
Time is running out though.. and if the US is downgraded by Moody's, Standard and Poors, et al.. their Treasury Bonds will plummet along with the country's AAA credit rating..
Hard to imagine what's going through the heads of those who're standing in the way of a compromise deal.. It's not just the US that will slip into an inflationary spiral should a deal not be reached.. but the world itself would be hit by an American default..
One would think there have to be some economists on both sides who see the consequences of devaluation.. and who care more about the long run than short-term advantages bought at the expense of American credibility..
And while Barack can say he's doing the best he can with an inherited situation.. he's only echoing the words of all the Western governments..
The problem remains, and a solution must be settled on..
More on this to come, as hopefully while the day progresses in the US.. legislators come to their senses and settle down with partisan politics set aside, and a viable solution is hammered out..

And as this day has progressed, it appears things might be happening in the US..
The House of Representatives has passed a Republican bill proposed by Speaker John Boehner to increase the nation's debt ceiling..
Boehner's plan passed the House by a vote of 218-210, with 22 Republicans and every Democrat voting against..
It includes $900bn of spending cuts and is not expected to pass the Democratic-controlled Senate in its current form..but it is a beginning..
Legislators will be working through the weekend to try and find a formula for fiscal regeneration.. Boehner appeared heated in front of his colleagues in the House.. slamming his fist on a podium on last evening and calling for lawmakers to pass his proposal..
His plan calls for a vote on an amendment to the US constitution.. a move Democrats say is certain to be rejected by the Senate..
Boehner said Republicans had tried their "level best" to reach a deal..
A vote on the Republican plan was originally set for Thursday but was rescheduled for Friday evening after Mr Boehner suspected the proposal lacked support within his own party..
The US government will start running out of money to pay all its bills unless a $14.3tn (£8.79tn) borrowing limit is increased by Tuesday..
Democrats have said the Republican bill as passed would cause immeasurable damage to the economy.. that it would force Congress to vote on another extension of the debt ceiling early in 2012, a time when presidential election campaigns will be in full swing..
Boehner's plan would reduce spending by about $900bn and raise the debt limit by nearly the same amount..
Democrats have vowed to reject the Republican bill the moment it hits the floor of the Senate..
And while this compromise may make some American voters think 'at least the Republicans are trying here..', it's not the long-term solution the Democrats want to take into the next election campaign..
Meanwhile.. roll on Tuesday..

Just a brief note here..the U.S. debt ceiling stalemate and the worsening Eurozone debt crisis have failed to trigger the relentless demand for gold seen during the global financial turmoil of two to three years ago. Today, it hit a fresh all-time high of $US1,632.16 per troy ounce.. But the momentum is flagging..
“The panic buying of previous sovereign debt crises is missing,” says Tom Kendall, precious metal analyst at Credit Suisse in London, echoing a sentiment widely shared within the gold industry. “Demand has been steady, but is not nearly as big as in the spring of 2010 or in early 2009, when debt concerns triggered panic buying.”
The precious metals market experienced a surge in demand during the worst of the global financial crisis, between January and April 2009 when stock markets hit their crisis lows, and again between April and July 2010 when Greece had to be rescued..
Mind you, should the US default.. the demand for the metal could go through the roof again.. and with it already being at a ridiculously high level.. it's hard to say how high that demand will get..

No comments:

Search This Blog

Blog Archive