The debt ceiling was constructed to prevent the government from spending more than its set limits. If the debt ceiling was strictly enforced, once a limit is hit, spending would need to be cut to prevent the budget from going over the limit. The problem with the debt ceiling is that whenever the government appears to hit its limit, the politicians from both parties agree to increase the debt ceiling. So in effect, the current government essentially runs with no “hard” debt ceiling.
The U.S. government, after winning World War II for the Allies, was very convincing. It told central banks around the world that they should hold the U.S. dollar as their reserve currency instead of gold, based on the idea the U.S. dollar would be backed by gold. Only limited amounts of U.S. dollars could be printed, because the currenc… Read More
The stock market…a place where rationality has been thrown out the door in favor of trading for immediate profits…profits based on what the government and Federal Reserve are planning to do next. It’s no longer a place for average investors to make money, as the fundamentals that drive key stock indices higher don’t really m… Read More
Companies in key stock indices have started to report their corporate earnings for the third quarter of this year. Not surprising, they are weak and show signs of stress.
According to FactSet, up until October 4, 90 companies in key stock indices like the S&P 500 issued negative guidance about their third-quarter corporate earn… Read More