Trump still telling GOP to negotiate hard using threat of zero increase of debt ceiling…
Ceiling to be reached this week after Thursdays auctions:
Janet Yellen warns US will hit $31.4tn debt ceiling next week https://t.co/6KQEyQMy0y
— Financial Times (@FT) January 13, 2023
9 comments:
I still don't understand why Biden doesn't call their bluff.
Congress passed the spending and taxation bill. Congress also passed the debt ceiling bill - which relates solely to bonds or notes. In addition Congress has set a limit on dollar bill issues.
If the spending is more than the taxation and debt, then the difference has to be a 'Carried Forward Item' in the books of the Federal Reserve and Treasury.
That carried forward item has to occur, which means that Congress has 'implicitly repealed' any restrictions in the Federal Reserve Act that would prevent that carried forward item existing.
It is for the courts to determine what is the least amount of change required to the existing law to make it all add up under the doctrine of implicit repeal. The two easiest options is to judge the Federal Reserve does not have the power to say 'no' to an order to pay from Treasury (which creates a negative equity balancing item in the Fed's books) or implicitly increase the debt ceiling (which has interest implications Congress has not authorised).
The way to do that would be to read the words 'the revenues of the Government or any part thereof may be deposited in such banks' in Section 15(1) of the Federal Reserve Act as meaning 'any such revenues now and in the future'.
I understand why politicians resort to theatrics instead of seeking clarification on existing legislative acts. The day Biden calls their bluff is the day someone else demands that Humphrey-Hawkins be enforced.
Slippery slope.
“ I still don't understand why Biden doesn't call their bluff.”
Because he believes it too…
Pols like it because they can take turns using it trying to f-ck the other side,.,
Right now GOP trying to use it to reduce Democrat fiscal priorities… eg woke indoctrination, human trafficking, climate nutter stuff, drugs, gender bending, etc…
The only side being f'd are ordinary Americans. This is by design...
We’re not getting F’d by this … govt keeps spending according to appropriations…
Didn't mike say we have until September before we have to worry? Besides they always increase it anyway, no reason they'd commit suicide this time.
I think it’s June…
They will have prioritize payments in June according to Yellen…
Depends on what the deficit turns out to be,,,
They have 300 in TGA, maybe 300 in federal employees retirement fund, 75 left in ceiling…
So maybe 675 in deficit spending.,,
Lucy always pulls away the football before Charlie Brown can kick it.
No bluff will be called, no default will occur.
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