Deceived Once Again
Is the political and economic fraud of the United States deal on the debt ceiling fooling anyone? So asks Brandon Smith at Alternative Markets, who reveals why the agreement amounts to nothing.
The U.S. debt ceiling was raised by the machinery of Government. The GOP and Democrats struck a deal which, while a compromise, planned to lower state expenditure and reign in the debt and public deficit. Crisis averted, right?
Wrong. In much the same vein as the supposed cuts our Chancellor of the Exchequer, good old little George Osborne has (generally not) implemented, the U.S. deal raised the debt ceiling, increased U.S. debt and did not make actual cuts in U.S. expenditure.
The ‘cuts’ made in the deal were reductions in the increase of U.S. public expenditure – not an actual cut, just a decrease in the increase – or in other words United States state expenditure will increase, though at an ever so slightly slower rate. An historic deal!
Far from solving the United States’ dire economic problems, they have been put off for another dark day. Mr Smith continued:
The debt decision and the above mentioned dire indicators leave us with two inevitable consequences: One, our credit rating WILL be downgraded, by S&P certainly, followed by Fitch and Moody’s later on. Two, we are, without a doubt, soon to see an announcement from the Fed of a third QE. Both of these items WILL lead to the final abandonment of U.S. treasuries and the dollar by the East, and likely by OPEC, ending in stagflation. That is, if they don’t commit to a dump beforehand. What we are looking at is the turning point of the final phase of total structural debasement of the U.S. economy. This is it, folks. This is where illusions are lifted, lies are revealed, assumptions are squashed, and things start to get really ugly.
Meanwhile, as the problems stack up across the Atlantic, the Euro zone countries are lurching into the latest phase of the Euro crisis. News of Spain and Italy readying for likely default has sent the markets spiralling downwards, and the European Commission are flapping as the Euro begins to come undone.
It is likely the Eurocrats have another bailout up their sleeves, but, like the last, it will only put off the inevitable. There is only so long you can put off paying your debts – and for the United States, the EU and probably the United Kingdom too, that day is coming – and coming very soon.
