That means that for 56 straight days the federal debt has remained approximately $25 million below the legal limit.
Even though the portion of the federal debt that is subject to a legal limit has not changed in almost two months, the Treasury has continued to sell bills, notes and bonds at a value that exceeds the value of the bills, notes and bonds it has been redeeming.
The “public debt subject to limit”–as the Treasury calls the portion of the federal debt that is legally limited by Congress–first hit $16,699,396,000,000.00 at the close of business on May 17.
http://cnsnews.com/news/article/treasury-debt-has-been-exactly-1669939600000000-56-days
“Key Takeaways:
- We expect the Treasury to exhaust its extraordinary measures to create borrowing authority on October 31, and run out of cash on November 1.
- Our “drop dead” date is about two months later than an earlier forecast. The main reason for the change is that we underestimated how much borrowing authority Treasury could create this time around.
- Our forecast assumes that Freddie Mac pays Treasury a $30.0 billion dividend at the end of September. That’s not a given, though.
- Even without the dividend payment, Treasury could probably make it to November 1 without a debt limit increase.”
http://www.zerohedge.com/news/2013-07-12/remember-debt-ceiling
This article sets out the “official” story of the “problem.” Read between the lines. The blueprint of the next manufactured crisis is here.
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“The U.S. will once again run into is debt limit this fall, and the smart money isn’t on whether there will be another congressional showdown, but when it will happen.
The drop-dead date is likely to be around Oct. 31, according to the latest analysis of headroom under the ceiling by Nancy Vanden Houten of Stone & McCarthy Research. Treasury has been using extraordinary measures to keep U.S. debt under the cap since May, and rising revenue has managed to put off the day of reckoning for months. But that day will come eventually, and the end of October could shape up to be a perfect storm of policy uncertainty.
Before the U.S. gets to the debt ceiling, it will have to deal with funding the government for fiscal 2014 that starts on Oct. 1. Failure to come to an agreement could result in a shutdown. Usual practice is to pass a continuing resolution that kicks the can down the road, and it’s likely that such a move could be pushed off for a few weeks and coupled with the debt ceiling.
That should be enough to have any Wall Street trader reaching for the Alka Seltzer, but let’s throw another wild card into the mix: the Federal Reserve has a meeting scheduled for the same week that Treasury is likely to bump into the debt ceiling.
The Fed is expected to start slowing it purchases of bonds some time in the autumn. Many economists now expect the so-called tapering tobegin in September. But, as Chairman Ben Bernanke likes to remind markets, Fed policy is dependent on data, and it’s quite possible that the Fed could be still be debating its first action when it meets in October.
Of course, there’s still a lot of time for all of this to be made moot. The Fed could make its intentions crystal clear and alter policy in September. Meanwhile, Congress could come back from summer recession refreshed and avoid both a government shutdown and the debt ceiling with a grand bargain that accomplishes some but not all of both parties’ goals. When Halloween rolls around this year, it should be clear whether markets are in store for a trick or a treat. Care to wager which one is more likely?”
http://blogs.wsj.com/economics/2013/07/13/number-of-the-week-potential-perfect-storm-of-debt-ceiling-and-fed/
What if this is connected?
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