We will find out if the right wing of the Republican party really owns McCarthy or not.
vanderlyn
1 year ago
kabucki theatre. anyone who still falls for this charade in 2023, really is quite naive.
8dots
1 year ago
The banks might extract their RRP and excess reserves to increase assets. The front end is anchored. The middle and the long duration might rise and normalized. The cost of financing gov debt will rise. GDP might rise faster than the cost of interest. If interest/GDP rise faster it’s either due to higher inflation or lower GDP in recession, while the Fed stay the course, don’t cut interest rates.
amalagoli
1 year ago
These clowns make a big noise about cutting the budget, but then they would still vote to increase defense spending and to prohibit Medicare from bargaining on medication prices. Their idea of cutting the budget is to eliminate all benefits and all public education as their fascist billionaire donors want.
Directed Energy
1 year ago
What a ridiculous position to be in. Social security is not an entitlement, everybody pays into it. Not only should it not be touched, it should be vastly increased.
Defense spending is another ridiculous item to ponder cutting right now, it should be vastly increased too. China’s foaming at the mouth when it comes to passing this country, they would just absolutely love for us to cut the budget. Not to mention the fact that defense spending literally supports hundreds of thousands of jobs!
Many government jobs don’t pay into it because they don’t collect (they get guaranteed government pensions instead)
Also people who don’t work (housewives, welfare etc) don’t pay into it but they certainly can collect it.
Lastly no one pays into it anywhere CLOSE to what they collect from it unless they die very soon after starting to collect (like 3-5 years after starting). So if you want to increase the payout you have to increase the amount collected which isn’t going to go over well with the people currently paying in.
If a percent or 2 increase helps, I say go for it. Removing the income cap helps as well. Perhaps people over a certain income such as $10 million could pitch in more as well. I’m not for unfair taxation but there is no doubt the current setup is out of balance.
Hi Tim. i think there are only 9 states that do not pay into social security and then have to deal with the WEP & GPO offset.
Agree with your concerns on SS . I think they are going to raise the retirement age again, but also, up the SS base to maybe 500K instead of current $160,200
Interesting if there would ever be a true winner or loser. I couldn’t see either side surrendering, even if both capitols were destroyed. Probably end up with a situation like Man in the High Castle.
I don’t want to see the American standard of living decline anymore. Something’s going to break someday
Counter
1 year ago
My biggest gainers are energy and resources
Salmo Trutta
1 year ago
The only expense untouchable in the budget is interest.
And it’s starting to shoot up quite nicely to the tune of $718B last year. $900B is a real possibility this year. FY 2024 puts $1T into a real possibility if we don’t have a recession followed by a Fed pivot.
Economics is a science of lies. The FED’s monetary transmission mechanism only became interest rate manipulation after legal reserves were discontinued. By tracking legal reserves, all recessions were both predictable and preventable.
We knew this already:
In 1931 a commission was established on Member Bank Reserve Requirements. The commission completed their recommendations after a 7 year inquiry on Feb. 5, 1938. The study was entitled “Member Bank Reserve Requirements — Analysis of Committee Proposal”
its 2nd proposal: “Requirements against debits to deposits”
Member Bank Reserve Requirements: Analysis of Committee Proposal, Box 107 (stlouisfed.org)
After a 45 year hiatus, this research paper was “declassified” on March 23, 1983. By the time this paper was “declassified”, Nobel Laureate Dr. Milton Friedman had declared RRs to be a “tax” [sic].
Now the FED is without a rudder or an anchor. Presumably, to get a recession, there would have to be a marked reduction (negative rate-of-change) in short-term money flows (“M” as defined by Shadow Stats).
R-gDp broke out because of the drop in money demand. As Alfred Marshall’s “cash balances” explains, money is truly a paradox – by wanting more the public ends up with less, and by wanting less it ends up with more.
The length of the period over whose transactions purchasing power in the form of money is held is a function of the volume of cash held and the level of prices, ergo, the velocity of circulation.
“According to Alfred Marshall’s “cash balances” type of analysis, the value of money or its reciprocal, the price level, depends upon the supply of and the demand for money. The equilibrium concept presumes that the height of prices at any given time is determined at a level which just equates the supply schedule and the demand schedule of money.
Over a period of time, however, it is just as logical, and justifiable, to say that prices determine the supply of and the demand for money as to say the converse. The price of money and the price of wheat are, at any given time, the net resultant of the forces operating through supply and demand, but over a period of time price is both cause and effect in determining the price of wheat or the price of money.
Unlike the supply and demand analysis applicable to commodities, the supply of and the demand for money are simply two sides of the same “coin”. This follows from the fact that the suppliers are simultaneously the demanders, and the demanders are simultaneously the suppliers If a person increases his demand form money, he is simultaneously reducing his supply of money, in the schedule sense, and if he is increasing the supply of money, he is reducing his demand for money. It may be said therefore, that an increase in the demand for money is concomitantly associated with an equal and opposite decrease in the supply of money, and vice versa.
Thus, we may say that the prices of things will rise, ceteris paribus, and the purchasing [power of money will fall, if there is an increase in the supply of money (decreased demand for money). Similarly, the expectation of a rise in the price of things will induce a decrease in the demand for money (increase in the supply of money).” — Dr. Leland James Pritchard, Ph.D. Economics, Chicago 1933, M.S. Statistics, Syracuse, Phi Beta Kappa
Lisa_Hooker
1 year ago
Just so I have this straight.
Before 19 January The US Treasury can just dump cash on whatever the US Congress has already borrowed money for.
After 19 January the US Treasury will actually have to look closely at what the cash is being spent on.
Like us non-politicians do.
shamrock
1 year ago
I don’t think there have been any spending cuts since the Clinton years. So please, go ahead and propose some specific cuts.
Cut SS to millionaires. Cut COLA to zero with negative CPI. Trim defense. Increase weapons production for other nations. Force them to pay.
Increase real wages to extract people on disability, SS, SNAP, housing… Collect student loans. Cut woke colleges. Cut the bloated veterans benefits. Put a muzzle on war mongers. Force a ceasefire in Ukraine. Produce minis that power underwater drones…build a wall, raise tariffs !!
Cut real monies already budgeted, not proposed increases for next year.
worleyeoe
1 year ago
The UNIPARTY, obviously!
KidHorn
1 year ago
This is what always happens. They can only pay essential personnel. Which are the contractors by and large. Particularly IT workers. Government employees are furloughed and don’t get paid. At least not when they normally do. The essential personnel are restricted with what they can work on. They can only maintain things. Not enhance anything. They have to maintain systems whose users aren’t working because they’ve been furloughed. So IT managers have to invent things for their employees to do so when they submit their monthly reports, they look like they were doing something. The employees read things like SQL Server 2005 manuals. Or at least pretend to. The government employees get a free vacation since they’ll eventually get all their back pay. All the while complaining about how terrible the situation is for them. Eventually, when the impasse looks like it might cost votes, the debt ceiling is raised. Calling it a debt ceiling is absurd. it should be called a debt target.
Only the good contractors are reading manuals. The busy work folks are taking on-line training from HR for Social Responsibility and Gender Equality and Sexual Harassment.
The good contractors keep clicking next during the training until they get to the quiz, where they have 10 chances to answer the multiple choice question with 5 possible answers. Wouldn’t shock me if some government employees failed the quiz.
My amusing comments are based on facts from 100 years ago. Four deep recessions in the 1920’s. Wilson and his collapse copper kings and Liberty bonds.
President Harding, a guy from rural Ohio, a ladies man, who was elected in rd 10, put Andrew Mellon in the treasury (1923 and 1932). President
Harding died at age 57 from heart attack. President Coolidge his vp replaced him. They cut and chopped gov budget and busted the war inflation. For Coolidge natural disasters, floods and RE collapse are state matters. They cut the Navy power and army. They didn’t stop cutting, but reboot the Fed which financed the 1920’s speculations…
1920. Wasn’t that when there was a recession and the Fed didn’t do anything about it and it was over and done in under a year and a half?
jivefive99
1 year ago
And once again 80% of Federal dollars are spent on Social Security, Medicare, Medicaid, Interest on the debt, and Defense .. all WILDLY popular programs. Cutting foreign aid, the National Endowment for Whatever, and the thousands spent to give every illegal immigrant a house will not make even a dent.
jivefive99
1 year ago
He will fold just like the last time “they” folded … when the air traffic controllers wouldnt let their first-class-section planes take off fast enough to get over flyover country as fast as possible and onto Los Angeles or, in reverse, New York. Thats how it ended when Trump tried it.
whirlaway
1 year ago
Both sides will win. The losers will be the American people. This is how things will play out :
1. Republicans threaten to shut down the government and cut off all funding for the proxy war in Ukraine, unless the Donorcrat Party agrees to steep cuts in SS & Medicare.
2. Donorcrats freak out when they hear about… the Ukraine proxy war spending cuts. But they instead pretend to be concerned about SS & Medicare cuts (which they most certainly are not).
3. The two sides meet and the Donorcrats offer substantial, but somewhat smaller, cuts to SS & Medicare (remember 0-bama’s “Grand Bargain” of 2011?)
4. Republicans agree to the proposal and agree to raise the debt ceiling. But when the final bill is passed, somehow, tax cuts for the rich would have “mysteriously” made their way into the bill.
5. Donorcrats claim a major victory because they were able to “minimize” the cuts in SS & Medicare spending.
6. The MSM declares it is a victory for “bipartisanship”.
Matt3
1 year ago
Oh my! A government shutdown would kill us all. What would we do with out our masters guiding us?
It’s all theater. Both parties are on the government payroll for graft and skim. Neither party wants to spend less money. The fight is over who’s donors and family’s get to skim the most. To paraphrase – It’s a big club and I’m not in it!
Trailer park politics. ROTFLMAO. Not really. Just another liberal minded Zardoz joke.
At some point, whether it’s 2023 or 2033 etc, America has its financial reckoning coming. And when it does, we’ll wish there was a trailer park politics answer, but there won’t be.
The obvious & factual point BBJr is trying to make is that NP doesn’t know how to say no. We could put McConnell in that statement as well. And let’s not put any great hope in Hakeem being any different. Fortunately, The GOP has the house for the next two years, and then The Man DeSantis comes to power. While I don’t expect him to balance the budget, I do believe he’ll make good progress at putting America on the right financial footing.
And the looking 2024 recession will go a long way towards getting rid of the dem scourge for at least 8 years.
billybobjr
1 year ago
Info on S&S and Medicare
As of 2021, the S&S Trust Fund contained (or alternatively, was owed) $2.908 trillion The Trust Fund is required by law to be invested in non-marketable securities issued and guaranteed by the “full faith and credit” of the federal government. These securities earn a market rate of interest.
The Medicare report projects an increase in HI Trust Fund asset reserves in 2022 as total income ($386 billion) is expected to exceed total cost ($356 billion).
The trust fund is an accounting fiction. SS has always been a transfer from those working to those retired. In real time.
If we want to complicate that description, we can start by noting that SS is paid for with a flat tax. But, not really. The SS flat tax money goes into the same bucket as income/corporate taxes and the broad wealth tax of money printing (AKA “borrowing”).
Jmurr
1 year ago
That’s easy. Republicans always cave. Usually sooner than later. Only in DC can you vote on the omnibus and then ask for budget restraint 3 weeks later.
I don’t think she wants to be president. When she’s sworn in she’ll have a terrified deer in the headlights look on her face.
Greenmountain
1 year ago
I guess we are well pass hoping for a legislature that acts like a legislature and actually votes appropriation bills that are debated on the floor. If Mr. McCarthy is so appalled by all the wasteful spending, where has he been since 2019???? Why didn’t he find all that waste 3 years ago? A grandstander without a plan.
8dots
1 year ago
The Irish quartet will run this country : Biden, JP, McC and BAC Brian Moneyham in the treasury. Jamie is too flashy. He will outshine Biden.
8dots
1 year ago
The dbl McC will not buckle. They will bend the will of Chuckie. The key is what/when will happen after June 2023. Biden will blame the radical
refuseniks. The triple Irish gang – Biden, JP and McC will cut gov debt in real terms and it’s size. US 10Y might breach 5%. The banks will lend. The banks will use their RRP and excess reserves to make money. The useless idiots R might re-elect Biden, but Gamala will takeover.
TheWindowCleaner
1 year ago
Even the stupid caucus won’t dare draw the debt ceiling idiocy out for long, and if they do…they’re the ones who will suffer just like Gingrich and co. did the last time the national “debt” issue got seriously political. The national “debt” is actually the money that has kept the private economy from swiftly falling into recession as Steve Keen has proven. I thought you said you learned alot from Steve Keen Mish. Did you forget that little detail?
They can, and I think they will. They are completely detached from reality, and have no idea what they would uncork.
Avery
1 year ago
Fauchi has already fixed Social Security and Medicare.
Esclaro
1 year ago
Democrats should call the Republicans bluff and offer a vote on drastic cuts to SS and Medicare. Make them stand up every week and say they are in favor and then watch them get decimated in 2024.
Easy now, BBJr. It was reported last June that Medicare Part A (hospitals) will run its trust fund dry by 2026. It was also reported that Part B (doctors) ran $495B in red ink pulled from the general fund.
I do however agree with you comment about the dems spreading garbage. Within 10 years, entitlements will consume 90% of the tax revenues. At some point, everything will have to see cuts. That day is coming.
JeffD
1 year ago
Neither side will yield, so the American people will prevail, at least in the long term.
How we wish! But, no, both sides will win. Ordinary Americans will get screwed.
garryl44
1 year ago
My MAGA Republican neighbors simply don’t believe the Republicans will cut SS or Medicare because they don’t hear it on Newsmax or OAN and believe its campaign season BS from Dems. They are also adamantly against cuts to either and said all we have to do is eliminate food stamps and welfare for black and illegal immigrants and we would not have a budget issue. As a
Financial planner I gave up years ago trying to explain the issue to them.
It’s pretty strike to compare fox to the other news sites. Fox is full of clickbait and celebrity nonsense. They don’t inform… they distract
MPO45
1 year ago
Republican Chip Roy has a plan…. he’s making a list and checking it twice, putting social services at the bottom of payouts when the default happens and presumably US Treasurys at the top. If this happens I would assume either social security or medicare payments don’t go out or get cut then the fun really begins….
If there is no money for medicaid and hospitals are REQUIRED to treat patients on medicaid what do you think will happen? Hint: they will go bankrupt. you can’t provide a service then not get paid. So having medicare is irrelevant if hospitals are broke and can’t provide services. Doctors just won’t take medicare anymore, good luck finding a doctor. Do you see how it’s all intertwined and connected?
None of this bothers me, i am well over a decade+ before I can even apply for any social service and plan on moving overseas anyway so I have no use for either program.
I do know what the republican slogan will be for 2024, “No senior left behind!” because every senior will be left behind and the machine needs to convince the clueless that they are there for them.
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Economics is a science of lies. The FED’s monetary transmission mechanism only became interest rate manipulation after legal reserves were discontinued. By tracking legal reserves, all recessions were both predictable and preventable.
We knew this already:
In 1931 a commission was established on Member Bank Reserve Requirements. The commission completed their recommendations after a 7 year inquiry on Feb. 5, 1938. The study was entitled “Member Bank Reserve Requirements — Analysis of Committee Proposal”
After a 45 year hiatus, this research paper was “declassified” on March 23, 1983. By the time this paper was “declassified”, Nobel Laureate Dr. Milton Friedman had declared RRs to be a “tax” [sic].
Now the FED is without a rudder or an anchor. Presumably, to get a recession, there would have to be a marked reduction (negative rate-of-change) in short-term money flows (“M” as defined by Shadow Stats).
And? Is that supposed to be an excuse for violating the constitution by reneging on the debt?