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Print up trillions for yourself at thenothingstore.com

The government plans to issue $2 trillion in new bonds this year to finance economic and financial rescues.

Just unreal.

Any barking moonbats going to condemn Obama for his extraordinary spending?

Rhetorical question, I know.

Only liberals are stupid enough to be surprised by this. It was totally foreseeable for grownups. How would loan, say, $10 K to someone in foreclosure and personal bankruptcy? You'd have to be out of your mind even to consider it.

That is our problem, writ large.

Welcome back Carter.

This is deja vu all over again (apologies to Yogi). I guess President Carter just didn't "do enough of it". So, this collection of ass clowns is going to show how how FDR and Peanut Boy should have done it.

What could possibly go wrong?

These debt auctions are where the rubber hits the road. This is where we're going to find out our capacity for debt. Somebody has to keep buying these, or we're hosed. The terms were tightening up considerably this time. Next time? Or the time after that? What if there are no bidders at all? Oops. I know I don't have that kind of cash on hand. It would be interesting what kind of spin they would put on that one. Wait, maybe I should say "will".

What if there are no bidders at all?

No problem - the Treasury will just do what it did last auction: buy some of its own debt. Hey, it work for Fannie and Freddie!

Paying back down debt with... you guessed it, more debt. It's worse than paying off a credit card with another credit card because, as more money gets printed, the currency itself loses value.

GENIUS!

Evilwrench, if there were no bidders for these auctions then we would have already reached financial Armageddon. It would mean none of the primary dealers have actual cash to pay for the bonds or notes (they can't be purchased with credit). Essentially, we would have run out of "everyone else's money."

As it is now, we can't really have a "failed auction," per se (excluding the above scenario). The U.S. Treasury has a collection of primary dealers who are only in that position because they agree to buy whatever bonds the Treasury auctions. Where we discover an auction has, for all intents and purposes, "failed," is in the turnaround demand for the notes or bonds. It was horrible for this auction, and this is only the 5-year bonds. Next comes the 7-years. I can only imagine how hammered the 30-year notes will be.

This is why spending 3.6 trillion dollars (projected) in a year is bad. You have to finance it in the short-term unless you want to be raped on interest rates on long-term debt like that. The yield curve steepens (fears of inflation and massive influx of debt) so it becomes more expensive to service that debt. So you borrow more, and the yield curve steepens. So you borrow more, and the yield curve steepens.

Eventually you reach an exponential explosion in which merely servicing your debt and interest owed by issuing further debt is, quite literally, impossible.

At that point, you either print money (thus destroying your currency and thus, your economy) or you tell your foreign creditors to go pound sand (thus devaluing and destroying your currency and thus, your economy).

Both are bad things, to simplify it grotesquely.

Bear in mind I'm no expert on these matters and nothing I say should be taken at face value. I encourage everyone here to learn as much as you can about how our day-to-day finances function.

Then, buy as many provisions as you think you'll need in the event of a total financial Hiroshima. Imagine the trucks stop running, that sort of thing. You owe it to yourself and your family to be prepared.

A couple of days ago, Hopey announced that the recession has REVERSED and we are slowly recovering, even though the government has spent only EIGHT PERCENT of the "stimulous".

If Hopey McChange says that there is NO NEED to spend the rest of the trillion plus, he would have vindicated his socialist plans, gained the respect of a million conservatives and POSSIBLY gained a second term.

But he won't do that, because it would be the smart thing to do. After all, the "global warming" conmen didn't claim that their warnings and advice "saved" civilization when the cooling started, did they?

In other words, Liberals are STOOOPID.

Yeah, I don't pretend to know the insides of all this, just that somebody has to buy the debt, whatever they can do with it thereafter. However, I can't imagine we have some people, with enough money, on the hook to buy the stuff regardless what they can do with it. That's just not a sane policy to adopt. There's a limit somewhere, and I suspect we're approaching it.