The debt noose is starting to cinch. From Simon Black at internationalman.com:
Sometimes you have to marvel at the absurdity of the financial universe in which we live.
On one side of the Atlantic, we have the United States of America, which triggered yet another debt ceiling disaster last Thursday when the US government’s maximum allowable debt reset to just over $20 trillion.
Of course, the US national debt is pretty much already at $20 trillion.
(That’s roughly $166,000 per taxpayer in the Land of the Free.)
This means that Uncle Sam is legally prohibited from ‘officially’ borrowing any more money.
But far be it from the US government to start living within its means. Sacrilege!
These guys have zero chance of making ends meet without going into debt.
Just last year, according to the government’s own financial report, their annual net loss totaled $1 TRILLION, and the national debt increased by $1.4 trillion.
And that was in a relatively stable year. There was no major war or financial crisis to fight. It was just business as usual.
This year isn’t going to be any different.
So, cut off from their normal debt supply (the bond market), the Treasury Department is resorting to what they call “extraordinary measures.”
They’re basically pillaging government employee retirement funds, and will continue to do so until Congress raises the debt ceiling.
It’s a repeat of what happened in 2015. And 2013. And 2011.
Pretty amazing to consider that the “richest” country in the world has to plunder retirement funds in order to keep the lights on.
Former US Treasury Secretary Larry Summers said it perfectly when he quipped “How long can the world’s biggest borrower remain the world’s biggest power?”
Then, of course, on the other side of the Atlantic, we have Greece, which is now in its NINTH YEAR of a major debt crisis.
Greece has had nine different governments since 2009. At least thirteen austerity measures. Multiple bailouts. Severe capital controls. And a full-out debt restructuring in which creditors accepted a 50% loss.
Yet despite all these measures GREECE IS STILL IN A DEBT CRISIS.
To continue reading: Nine years later, Greece is still in a debt crisis…