Debt Default

Bill Bonner writes:

And here we find a political movement The Daily Reckoning can stand…far…behind... the part that actually wants the US government to default.

Whoa! We know what you’re thinking. A default would be dangerous. Suicidal. Unthinkable. Ben Bernanke. Tim Geithner. Larry Summers. They all said so! The old folks wouldn’t get their medicine. The soldiers wouldn’t get their ammunition. Tops would go back onto honey pots all over the Washington DC area. The whole system would fall into anarchy and pandemonium. There would be riots. Revolution. Bourbon would disappear from the liquor store shelves. The dead would rise from their graves and the living would fall into the open holes. A man would be happy to see his dead wife alive again. Another would be even happier to see his living wife dead!

Well, maybe they’re right. It would probably be a catastrophe. A disaster. But let’s take the chance anyway!

Because the real problem is debt. The quicker it is eliminated…the faster the economy can get back to work.

So, don’t raise the debt ceiling. Let the feds figure out how to get by like everyone else – spending no more than they take in as income. Is that really so tough?

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Bill Bonner on Det and Defaulting

Moody’s warned that the US would lose its triple-A rating if it continues borrowing money at the present rate. Our old friend Marc Faber was on TV this week explaining what the consequences would ultimately be: the US will default on its debt, he said.

Mr. Geithner did not even bother with the idea of default. It was beyond his imaginative powers. As to losing the three As, he said that would “never” happen. Which is what set us to thinking about the quality of US leadership. Of course, the US will lose its bond rating…and will default. There is no question about it. No nation has ever existed, except for present company…whose histories have yet to be completed…that didn’t default, renege, collapse, go bankrupt, disappear, disintegrate, capitulate, or otherwise fall over and die. The only questions are when and how.

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