IMF head warns US debt crisis threatens world economy

[muriel_volestrangler]

Source: BBC

IMF managing director Christine Lagarde says failure to raise the debt ceiling is a far worse threat to global economy than the current government shutdown.

She said it was "mission critical" that the US agrees a new debt ceiling.
...
In a speech looking ahead to a decade of challenges for the world economy, Ms Lagarde said that the US government needed to fix its finances for the long term.

But as she has often said before, there should not be too much change in the short term because that could undermine the economic recovery.

Read more: http://www.bbc.co.uk/news/business-24384759

[leftyohiolib]

1. more reasons for the world to dump the dollar

[adirondacker]

2. "Just when you think things can't get any worse"... nt

[Bosonic]

3. US default could be 'catastrophic': Treasury (AFP)

Washington — A US default on its obligations forced by Congress not raising the country's borrowing ceiling would have catastrophic effects, the Treasury warned Thursday.

With the government likely to exhaust its cash reserves around October 17, the Treasury said being forced into non-payment of any of its obligations -- and in particular its debt -- would spark turmoil in financial markets and possibly send the country back to a recession as deep as that of 2008-2009.

"In the event that a debt limit impasse were to lead to a default, it could have a catastrophic effect on not just financial markets but also on job creation, consumer spending and economic growth," the Treasury said in a report.

"Credit markets could freeze, the value of the dollar could plummet, US interest rates could skyrocket, the negative spillovers could reverberate around the world, and there might be a financial crisis and recession that could echo the events of 2008 or worse."

http://www.google.com/hostednews/afp/article/ALeqM5g66B-x9qoZw23qgp34Y1bjLOBBaA?docId=d180d0bc-4bec-46de-9c5a-6a8cc39cecf9

[Uncle Joe]

4. Kicked and recommended.

Thanks for the thread, muriel_volestrangler.

[tavernier]

5. If its not happening in Hicksville

they don't give a shit.

[Lint Head]

6. It has nothing to do with the debt. It has to do with "paying the debt". The US can afford to pay

it's debts. Obama just explained it very precisely using someone sitting in a restaurant ordering wine. It was great. The Tea Bagging treasonous criminals are the ones holding all of us hostage.

[dipsydoodle]

7. That does however assume

the US will pay its debts without simply printing money to do so.

[Lint Head]

11. True but the US has always printed money. My understanding is that not actual greenbacks are used

to pay Federal debts.

[dipsydoodle]

12. Not readies as we call them in the UK.

But :

If a central bank purchases a government security, such as a bond or treasury bill, it increases the money supply, in effect creating money.

http://en.wikipedia.org/wiki/Government_bond

This may interest you :

Who owns the US dollar ?

At first glance, this would seem like a rather silly, stupid and pointless question. Why, the average person would answer, the American people own it. Or rather, if one had to get more technical, the American government, which is in turn, being a Republic, owned by the people, one in the same.

But, as most such simple seeming things in life, the truth is neither simple or straight forward and the answer is neither silly, stupid or pointless, but indeed is critical to the well being of nations and hundreds of millions if not billions of people.

For the truth of it, neither the people of America nor the government of America owns the US dollar. How's that, you say? Well, if one was to really dive just a bit deeper, before hitting the rocks just under the US greenback pond, one would quickly discover that the actual US dollar has not existed since 1913, where it was effectively killed. What is now called the US dollar is actually a Federal Reserve Note, says it right at the top of each bill. Why does that matter? Read on.

First of all, a US dollar, as something before 1913, was an instrument of wealth. That piece of paper, or just as common a gold or silver coin, had actual worth, anywhere in the world. It was worth its weight in gold, be it actual gold or paper. A Reserve Note, on the other hand, is a debt instrument, which not only is not wealth but is the opposite of wealth. Its very existence is a sucking sound on wealth, wealth being transferred, in this case not to the poor masses (as defined by defunct and unworking Marxism) but to the top 1% (equally defunct and unworking, but its only now starting to go that way).

http://english.pravda.ru/business/finance/14-09-2010/114921-us_dollar-0/

The Pravda link was just a convenient one. You'll easily find other on the subject of your Federal Reserve.

That's from 3 years ago but as recently as early this week a remark was passed that the system makes Bernie Madoff look like an amateur. As the above article closes with "Rarely has so brilliant and patient a ponzy scheme been dreamed up than this."

[Sunlei]

8. call a VOTE, put it on the floor today!! quit the economic terrorism republicans!

[PatrynXX]

9. think whoevers in charge

probably would be withing their rights to freeze our funds

[blkmusclmachine]

10. GOPee to World: Go F_ck Yourself!