Federal Debt and the Risk of a Financial Crisis

In fiscal crises in a number of countries around the world, investors have lost confidence in governments’ abilities to manage their budgets, and those governments have lost their ability to borrow at affordable rates. With U.S. government debt already at a level that is high by historical standards, and the prospect that, under current policies, federal debt would continue to grow, it is possible that interest rates might rise gradually as investors’ confidence in the U.S. government’s finances declined, giving legislators sufficient time to make policy choices that could avert a crisis. It is also possible, however, that investors would lose confidence abruptly and interest rates on government debt would rise sharply, as evidenced by the experiences of other countries.

Unfortunately, there is no way to predict with any confidence whether and when such a crisis might occur in the United States. In a brief released today, CBO notes that there is no identifiable “tipping point” of debt relative to the nation’s output (gross domestic product, or GDP) that would indicate that such a crisis is likely or imminent. However, in the United States, the ratio of federal debt to GDP is climbing into unfamiliar territory—and all else being equal, the higher the debt, the greater the risk of such a crisis. …read more

Earlier this week I received a call that Tara Servatius, from WBT  1110 AM, claimed to have spoken with “everybody who is anybody” in the TEA Party movement. And none of them support Tim D’Annunzio. Isn’t Tara supposed to be an “investigative reporter”?  If she was, she would have contacted someone in We The People of the Sandhills. However, she did not.I called Tara’s show at WBT in Charlotte, however she refused to take my call. The first person to answer the phone asked me what I wanted to tell Tara. When I told her, she put me on hold for

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Is it me or do those elected not realize what they say is recorded for posterity? As we have seen with the Connecticut Attorney General who has LIED about his service IN Vietnam. Not that he served DURING Vietnam, but actually served there. As he continues to say that these were “a few words misspoken”, I continue to wave the BS flag! …read more

Michele Bachmann explains how the government has taken control of over 51% of the country’s economy in eighteen months. The change that Obama promised in his campaign to transform the United States is well underway. Let’s see what kind of government we now live under:

1. One political party completely controls the government

2. Government controls the business sector

3. The isolation of one group to focus the people’s attention as the reason for the country’s problems. In our case the racist portion is directed against the tea party and evil Wall Street bankers. …read more