Free Republic

Between Oct. 1, 2013, the first day of fiscal 2014, and Nov. 14—which was less than a month after Congress agreed to temporarily suspend the legal limit on the federal debt—the Treasury was forced to issue more than $1 trillion in new debt. During that time, according to the Daily Treasury Statement, the Treasury issued $1,014,215,000,000 in new bills, notes, bonds and other securities. The government needed this $1,014,215,000,000 to cover government obligations and expenses that exceeded the $255,080,000,000 it raked in through tax revenues during the same six-week period. Where did that combined $1,014,215,000,000 in newly borrowed money and...

On September 17, 2008, the US total debt stood at $10.615 trillion and The Fed’s balance sheet was almost $1 trillion ($996 billion). Since that time, US total debt has skyrockets to … the statutory debt limit! That means that over President Obama’s Presidency (and the last couple of months of Bush’s Presidency), total debt climbs over $6 trillion. debtceilgst And The Fed’s balance sheet rose over $2.78 trillion. dcfeed With The Fed enabling massive Federal government waste (and Janet Yellen likely a willing enabler). Democrats and President Obama are refusing to negotiate on the budget or the debt ceiling....

You know how it is, you're going along with the lies that are told every day about "recovery" and "economic conditions are kinda "OK" and "we're doing all right" and then the mainstream media and "economists" like Goldman's Alec Phillips step on their ***** and tell the truth by accident. Economists at Goldman Sachs Group Inc., IHS Inc. (IHS) and BNP Paribas SA said they expect the Treasury to husband the tax money it collects to make sure it can meet interest and principal payments on the nation’s debt. Other obligations, from salaries of government workers to payments to defense...

The Treasury Department’s Office of Foreign Assets Control, responsible for enforcing economic and trade sanctions against Iran and Syria, is being hindered because it has been pared down to a “skeleton crew” by the government shutdown, a Treasury official tells ABC News. “This massively reduced staffing not only impairs OFAC’s ability to execute its mission, it also undermines [the Treasury Department's Office of Terrorist Financing and Financial Crimes] broader efforts to combat money laundering and illicit finance, protect the integrity of the U.S. financial system, and disrupt the financial underpinnings of our adversaries,” according to the official, who asked not...

Lew Op-Ed: U.S. Failure to Pay Bills Hurts Everyone 10/3/2013 WASHINGTON – In an op-ed to be published in the October 4, 2013 edition of USA TODAY, Treasury Secretary Jacob J. Lew discusses the importance of Congress raising the debt limit immediately to avoid self-inflicted wounds that could impede economic growth and create uncertainty for families and businesses. The text of the piece follows: U.S. failure to pay bills hurts everyone If Congress does not raise the debt limit soon, seniors, veterans, kids, among others, are at risk. By Jack Lew It might be hard to believe, but there is...

The Treasury Department has begun using the last set of accounting maneuvers at its disposal to allow the government to keep paying its bills until Congress raises the country’s borrowing limit, Treasury Secretary Jack Lew told congressional leaders Tuesday night. In a letter, Lew reiterated that if the debt ceiling is not raised by Oct. 17 the government will not be able to meet all its financial commitments, such as making payments to U.S. debt holders, government contractors and Social Security recipients “If we have insufficient cash on hand, it would be impossible for the United States of America to...

So much for the scare mongering. The Federal government shut down (or 40% of it) and the reaction in the Dow? Up 52 points as of 2:15pm EST. dow100113 The US Treasury 10 year rate also rose by 3.6 basis points. ust10100113 Gold? Dropped like a rock, but has risen slightly. gold100113 And a today’s 4 Week Treasury Bills Auction High Yield spiked. 4mthigh100113 So much for the “flight to quality” meme from the government shutdown.

<p>WASHINGTON — The Treasury will only have $30 billion of cash on hand by mid-October, putting the United States on the precipice of an unprecedented default, the department said on Wednesday.</p> <p>The warning puts additional pressure on a hamstrung Congress, which is already struggling to prevent the federal government from shutting down over a budget impasse on Oct. 1.</p>

While stocks have slipped for four consecutive days as investors turn their attention to Washington and the looming debt limit, the S&P 500 and Dow are just 2% from the all-time highs reached last week. In addition to the muted market action, a key metric for measuring market fear and volatility, the VIX (VIX), is indicating calm markets. While CNNMoney's Fear & Greed Index has ticked just slightly into "Fear" mode, from neutral earlier in the week. "I think if you look at the calm out there, it's a bit greater than it should be," Lew said at the Bloomberg...

The markets were stunned by The Fed’s decision last week not to begin tapering. Investors reacted … like deer in the headlights. deerheads Take the Dow Jones Industrial Average. After initial optimism on The Fed’s “No Taper” message, it has turned down. djiapostfomce The 10 year Treasury yield dropped with The Fed announcement and has continued to drift downwards. ust10postfomc As would be expected, both mortgage rates (yellow) and the Fannie Mae 30 year current coupon rate have drifted downwards. mtgratepostfomc Gold? Gold prices surged initially but had drifted downwards to about pre-announcement levels. goldpostfomc The good news? Both the...

Poor Larry Summers. He withdrew his candidacy as the Federal Reserve Board Chairman over fears of a brutal Senate confirmation hearing. Now we are left with former University of California labor economist Janet Yellen as the leading candidate. Yellen was (allegedly) the architect of the quantitative easing programs to reduce unemployment (better known as the weak money rally). And Yellen is the darling of the labor unions because of her activist policies on labor. Hence, President Obama and Democrats are proudly supporting her appointment. “The philosophy of Janet Yellen is activism of government policy to achieve objectives,” said Allen Sinai,...

Poor Larry Summers. He withdrew his candidacy as the Federal Reserve Board Chairman over fears of a brutal Senate confirmation hearing. Now we are left with former University of California labor economist Janet Yellen as the leading candidate. Yellen was (allegedly) the architect of the quantitative easing programs to reduce unemployment (better known as the weak money rally). And Yellen is the darling of the labor unions because of her activist policies on labor. “The philosophy of Janet Yellen is activism of government policy to achieve objectives,” said Allen Sinai, president of Decision Economics Inc. Oh great. We have activist...

Bernanke’s surprise (NO TAPER) resulted in a large decline in the 10 year Treasury yield yesterday and a small rebound today. ust10091913 But despite the surprise, the yield curve has declined only slightly compared to its increase after May 1st. yc091813 World bond markets are in a sea of green, particularly the UK and Italy. Even beleaguered Greece dropped 21 basis points in 10 year sovereign yield. wbm091913 Precious metals (gold, silver) soared on The Fed’s Taper bluff. goldsilvfed2 To quote The Who, “We won’t get fooled again!”

The Federal Reserve Open Market Committee released its update to QE: no change. The market was expecting $5 billion to be cuts from Treasury purchases, but nada. fedannouince Here is the redlined FOMC statement: 169179285-September-FOMC-Redline The Federal Reserve unexpectedly refrained from reducing the $85 billion pace of monthly bond buying, saying it needs to see more evidence of improvement in the economy. “The Committee decided to await more evidence that progress will be sustained before adjusting the pace of its purchases,” the Federal Open Market Committee said today at the conclusion of a two-day meeting in Washington. While “downside risks”...

The Federal Reserve Open Market Committee released its update to QE: no change. The market was expecting $5 billion to be cuts from Treasury purchases, but nada. fedannouince The Federal Reserve unexpectedly refrained from reducing the $85 billion pace of monthly bond buying, saying it needs to see more evidence of improvement in the economy. “The Committee decided to await more evidence that progress will be sustained before adjusting the pace of its purchases,” the Federal Open Market Committee said today at the conclusion of a two-day meeting in Washington. While “downside risks” to the outlook have diminished, “the tightening...

The Federal Reserve Open Market Committee is meeting today and tomorrow with an announcement tomorrow afternoon at 2pm EST. Virtually no one is expecting a change in the Fed Funds Target. fedconsesn What everyone is watching is a change in the Fed rate of purchase of Treasuries and Agency Mortgage-backed Securities. 20130917_FOMC If The Fed does nothing, I will be surprised. The most likely “taper” is $5-10 million per month, mostly or all in Treasuries. Agency MBS purchases are likely to remain unchanged. While there is some positive momentum in the economy, real median household income is declining. household-income-monthly-median-growth-since-2000 (1)...

The “Goodbye Larry! (Summers)” Treasury yield decline yesterday was short lived. After Summer pulled out as a candidate for Federal Reserve Chairman, the US Treasury 10 year yield fell 11 basis points yesterday morning, but the exuberance quickly went away. ust10091713. Speaking of interest rates, the National Association of Home Builders Market Index was flat for September compared to August, but missed expectations by the most since April. nahbhbindex09171`3 If we compare the NAHB Index with new home sales, we see a daunting gap between builder “optimism” and reality. nahbnhs091713. And if we include the Bankrate 30 year rate, we...

Rising interest rates are really starting to hit the economy. The Reuters – University of Michigan Survey of Consumer Confidence Sentiment was forecast to be 82.0 but printed at 76.8 after a previous print of 82.1. This is the lowest print in 5 months. Rising Treasury and mortgage rates are definitely a cause of declining consumer confidence. Notice that the 10 year Treasury yield began to decline in mid 2011 and consumer confidence began to rise (green box). Then Treasury rates began rising on May 1st and consumer confidence fell (red box). With a lag. consumerconfid091313 We know that mortgage...

The US economy is straying further and further away from a free-market model and towards a government-controlled, crony economy. We can see the results of the move to government control of the economy in the headwinds. Like in the movie “Idiocracy” where the government orders Brawndo, a green liquid that resembles Gatorade, be used instead of water for crops, the government’s solution to all problems is more government, more regulation, more taxes, etc. Government is what statists crave. Brawndo_Social_Head (1) Here is a partial list (the actual list is way too long) of headwinds facing the economy, the housing market...

Come with me, you the sea of … red. Almost every major nation has seen its 10 year sovereign yields rise today … and over the past 6 months. seofred The US 10 year has climbed over 100 basis points in the last 6 months, close to the UK’s rise. Our Latin American neighbors, Mexico, Brazil and Colombia have seen over 132 basis point increases. Americans spending more on cars and housing helped the economy maintain a “modest to moderate” pace of expansion from early July through late August, even as borrowing costs increased, the Federal Reserve said today. The...