Slashdot Mirror
New IMF Head Says US Must Raise Debt Limit, or Face 'Nasty Consequences'
fysdt writes with this from an article on ABC News: "The International Monetary Fund's new chief foresees 'real nasty consequences' for the U.S. and global economies if the U.S. fails to raise its borrowing limit. Christine Lagarde, the first woman to head the lending institution, said in an interview broadcast Sunday that it would cause interest rates to rise and stock markets to fall. That would threaten an important IMF goal, which is preserving stability in the world economy, she said. The U.S. borrowing limit is $14.3 trillion. Obama administration officials say the U.S. would begin to default without an agreement by Aug. 2."
No shit Sherlock. The only people who dont seem to understand this are the tea-baggers, but I dont find that particularly surprising, since their total understanding of economics is, "Taxes Bad."
and they aren't fooling anybody. They want a civil war and have all but admitted it. And that is exactly what America will get if the debt ceiling is not raised. In specific and to be fair to the Tea Party they want a revolution. They think if the government does not pay for benefits, social programs, and if the jobs market remains weak, they'll have an easier time recruiting desperate individuals into their militias that are spread across the country. And they are right, the FBI and Homeland security both agree:
The agency warns that an extended economic downturn with real estate foreclosures, unemployment and an inability to obtain credit could foster an environment for extremists to recruit new members who may not have been supportive of these causes in the past.
http://www.huffingtonpost.com/2009/04/14/homeland-security-report_n_186834.html
And this isn't the first time the Tea Party formerly known as the American Liberty League attempted to start a civil war. In the 1930s they attempted the business plot. More details on that can be learned by watching this documentary.
The coup attempt was prevented because General Butler tipped off FDR.
In response to this President FDR created the CIA. The FBI initiated operation COINTELPRO. COINTELPRO became the main counter intelligence operation in the USA with the main mission to prevent a civil war from happening. COINTELPRO has wide spread recognition by those on the left but most on the right don't recognize that COINTELPRO was originally directed at them and who it's directed at is at the discretion of the President and the FBI leadership.
Do any amount of research you want to confirm these facts. Try Googling "American Liberty League", "COINTELPRO", "Business Plot", "Tea Party Movement", and see what you find. Eventually you'll discover the "Guardians of the Free Republic", and other militia's behind the Tea Party who just happen to be from Texas, the same state Ron Paul and Alex Jones happen to be from. The same state President Bush pretended to be from. Why? Because the Tea Party movements headquarters are where the militias are, and Texas is one of those places with lots of militias.
And what is happening now? The FBI is more than likely investigating the Tea Party with as much zeal as they investigated Al Qaeda. The Tea Party is being crushed by the FBI as we speak, but if the US defaults then all hell will break loose. How will the FBI agents trying to prevent civil war be paid? The country will divide into factions, and if that happens, and if it turns violent, the USA itself and the union itself will be divided into factions. Foreign nations will be in a position to invade, or simply flood all sides with weapons and make the civil war long and bloody.
I don't know about you, but I have friends and family here. I do not want a civil war. The Tea Party needs to stop playing games with the global economy. They need to pass a fucking budget ASAP. If the nation defaults there will be nothing anyone can do to prevent a civil war. The unemployment rate will be so high that many people will have nothing to lose by fighting.
It's not the banks.
It's government debt, eg bonds. Greece's interest rate is like 28%, The US is 2%. Greece's economy has basically gone titsup without default, but they're still expected to default. All the countries that are in trouble their bond rate skyrockets as soon as it looks like the bonds are going to be worthless.
What does the government do with money? It pays government employees (Miltary, Entitlement programs, infrastructure and creditors.) Creditors are other countries/people/businesses, both domestic and foreign. If the US defaults, expect the equivalent of a bank-run on bonds and stocks (equities) to get their money out of the US and into safer places like... Japan or Canada (even if it's only for a short period of time.) Take a look at the price of most of the S&P 500 1 minute before and after the jobs report last friday. So many stocks dropped by 10% for several hours before picking back up, now multiply that in a downward trend, that is what will happen.
Publicly traded companies with stocks worth less than 5$ get delisted, and that means those companies are toast. Companies that are private and those that have physical assets like Apple might survive, but a lot of the service industry does not have physical assets and they are history if the US government defaults. The irony here is that the banks would survive, but they would be calling in their loans, which means 30% interest for you.
Yes it can be doom and gloom, but it's inconceivable that the debt limit doesn't get raised. If by some chance the politicians screw the pooch and don't get it lifted, every last one of them better not be re-elected.
It's not the goal of Tea Party Republicans to get re-elected. The majority of them are operatives for the Tea Party, which is controlled by militia operatives. They want to overthrow the US government itself even if it means launching a civil war.
They are deliberately trying to create an economic crisis because that is the best way to trigger a civil war. They already have the guns, they have the organization(militias) built up, they are ready. The sad thing is most American citizens aren't ready for it or don't want it. But when enough American citizens lose their careers, their jobs, and have no government benefits whatsoever to count on, no unemployment, no welfare, no food stamps, no anything, then the militias can give them one last job.
It's a recruitment tactic. The US government uses the same tactic of sanctions when it wants to overthrow a dictator. It's also because the Tea Party militias are tired of funding the government which is trying to investigate and crush them despite the fact that they've infiltrated the US government and control many politicians, there are still FBI agents who want to crush the Tea Part movement or any extremist movement that seeks to violently overthrow the government or cause a civil war.