Debt Ceiling

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.


Brinksmanship Could Start a U.S. Dollar Collapse Yet again, the United States stands on the edge of an economic collapse and the reasons are disturbingly familiar. The federal government is about to hit the debt ceiling, which stands above $18.0…

Today is Cyber Monday, when consumers will flock online and spend over a billion dollars. In 2012, $1.47 billion in sales occurred on this day and the expectations are that the number could swell to $1.68 billion today. (Dengler, P.,…

I’m getting increasingly nervous about the current stock market and its vulnerability to the downside. We have a fragile economic renewal, weak corporate revenue growth, muted jobs growth, a housing market that’s stalling, an upcoming leadership transition at the Federal…

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…

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…

In 2010, on average, for every one dollar in sales posted by the S&P 500 companies, $0.135 came from Europe. In 2011, this number declined to $0.11. In 2012, sales from Europe accounted for only $0.097 for every one dollar…

Recently, Alexandre Gautier, the director of market operations at the central bank of France, was quoted saying, “We have no plan to sell gold.” Meanwhile, the director general of the Italian central bank, Salvatore Rossi, said, “Gold underpins the independence…

It’s amazing how resilient the stock market has been in spite of the concerns toward the U.S. budgetary cuts and debt ceiling, the eurozone’s economic stalling and debt, and the overall earnings risk. The New Year has started off with…

We all know the Federal Reserve increased the money supply by trillions of dollars in its effort to boost consumer spending after the credit crisis hit in 2008. Sadly, I feel like the entire stimulus was given to Wall Street…

Last night, two of the biggest retailers in the U.S. increased their estimates of how much money they would make this year. Wal-Mart Stores, Inc. (NYSE/WMT), the world’s largest retailer, has reported that revenue at stores open at least one-year…

We have the PIGS (Portugal, Ireland, Greece, and Spain) battling with debt issues in Europe. Spain is not fully there yet, but may inevitably need to find money. These countries are referred to as the PIGS because of their need…

Stocks have declined for seven straight days to August 1, despite the debt resolution approved by the Senate and White House that’s waiting to be passed by the House of Reps. There was no doubt in my mind and the…

What a day for the market yesterday. Wherever we looked, we saw a sea of deep red. Stocks got chopped. Gold was down. Bonds were down. My dear reader, you’ll read opinions here in PROFIT CONFIDENTIAL that you will not…

On July 19 and 21, the key stock indices surged towards their respective multi-year highs. The key stock indices have shown some resilience after battling back from being down nearly 10% this year to the point where the S&P 500…

First it was Greece, then Ireland, followed by Portugal. There are also issues in Spain. This group is widely known as the “PIGS,” an acronym for the four countries and appropriately named for its greedy sucking of emergency capital (except…