In one week today the world’s biggest economy cannot pay its bills if Congress does not approve yet another higher debt limit. We reported in the Weekly Wrap back in March 2015 when the US hit their current debt limit of $18.1 trillion, and since then they have survived on ‘emergency cash funding’ / accounting games leaving no more avenues come Tuesday next week but to simply borrow more for their continual budget deficits (spending more than income). GOP’s John Boehner expects a new limit of $19.6 trillion with a review in March 2017 to be tabled. The graph below puts this latest figure into perspective. That perspective of course is an exponential rise in debt as the Ponzi scheme accelerates in its final throes. US Treasurer Jack Lew warned yesterday of the consequences should we see the games of 2013 replayed, and that doing so could result in an accident "that would be terrible." In 2013 the US Government shut down for 16 days resulting in a 0.3 impact on GDP and accompanying employment. The problem, as Lew alludes, is this times it’s potentially much worse. The cartoon below sums up this farcical situation… Removed as political rant! Read the rules!
You know what generates an exponential curve? Any exponential function. What's a good example of an exponential function? Any annual percentage increase. 20% inflation? EXPONENTIAL GROWTH! 0.2% inflation? EXPONENTIAL GROWTH! 1% annual salary increase? EXPONENTIAL GROWTH! Even funnier is when PM enthusiasts breathlessly observe that metal prices are about to "go parabolic". "Parabolic" growth is slower, over the long term, than exponential growth. If X counts the years, "parabolic" growth (X^2, or X^n for any value of n, however large) will eventually be overtaken and dwarfed by simple compound interest ((1 + r)^X, for any positive value of r, however small). But misuse of mathematical terms is usually the least of the problems in those sorts of discussions...
If you open up your own PAC, you can generate millions of dollars to fund this "Moderator" gig that I'm sure will pay a handsome return on investment. Cut a few deals with select vendors in return for lax rule enforcement... Support a few rule changes to favor them... Setup a few pawns for plausible deniability... Start lining up speaking engagements and an exit strategy... Somehow I feel dirty now, I'll stop.
