Is it over? Capitol Hill’s red white and blue fireworks left many Americans in fear of residuals dropping into their laps.
The House has reached the required majority to pass the debt limit increase. There remains the continued concern over Eurozone and possible loss of US AAA credit rating. At 6:08 p.m., Eastern Standard Time, the following statement came from the White House: “The bill would increase the debt ceiling to a level that will be sufficient for the Nation to meet its obligations through the beginning of 2013”.
In layman term it means, that the debt ceiling is layered and controlled in the future. In other words, raising the debt ceiling at first will allow the US Treasury through 2012 to put caps on spending, thereby reducing the deficit by $917 billion over the years. Secondly, an automatic cut with another round of $1.3 trillion cuts to come into effect to further boost the economy and then the by partisan joint Committee called the Supper Congress, will come up with another deal in September with more tax increases that could bring back SS, Medicare etc., into the deal.
“Thank God”, said Russian Prime Minister Putin that America had sense to make a balanced decision, as any malfunction would affect everyone in the world.
However, this debt deal compromise in the US cuts almost nothing at present and nowhere reduces the deficit of $4 trillion it originally targeted. As for President Obama to even considering taking a hard line on the Bush tax cuts by the time they expire again, he and most of his cabinet members will not be around for another voting. There is another dichotomy in the extensive debt bartering menu placed before Americans. When Vice-President Biden told the nation Monday, “We have to get the debt ceiling out of the way to get back to growing the economy”, the reality is, US unemployment rate is already hitting double-digits. Warning in the governments report show, the economy is growing weaker by an annualized rate of 1.3%. If we are not in double dip yet it is surely around the corner.
When pipeline dreams come out of Congress to pacify the American people by agreeing to raise the debt ceiling as a victory, it will take many decades to get the economy above water to make such dreams from conceptual to ACTUAL! It will take a long pipeline to reach new tracks. Meanwhile, Washington’s profile in global markets continues to be a major concern. Solving the debt problem with another debt only creates more debt. And as to how much will raising the debt ceiling cost taxpayers down the road, is another issue most mental midget can’t fathom.
For starters, slashing government spending through 2013 will depress the nation’s weak economy even further. Make no mistake about it; what we’re witnessing here is a catastrophe on multiple levels.” So how in raising the debt deficit on paper will help to build the economic tidal wave battering most American households. The meaningless 11th hour decision to sooth the public is just that. Debt has to be repaid, and so does the interest. The printing press hasn’t turned on yet, but the dollar is sliding fast. Its process and potential is realized in gold as it crossed over the highest mark of $1640 today. Political failure has before and will again spark some intriguing opportunities for investors in a surprising way to profit with the yellow metal. “Gold is not fiat. More money equals less value and a more dangers of inflation. Gold is self-evident in the liberty from any regulation or control”, says Regal Asset Team of Analyst.