While Rome Burns The Senators Are Partying!

Bartenders in Washington are telling us that while the US dollar is collapsing the Senators and MP’s are partying from as early as 9 am. Here are some quotes:

I’m not over exaggerating when I say I can smell the booze wafting from members as they walk off the floor.

— Ginger Gibson (@GingerGibson) September 29, 2013

About every other House lawmaker I just talked to smelled like booze. It’s only 9pm. Wheeee!

— jennifer bendery (@jbendery) October 1, 2013

confirmed. also, it’s a bipartisan affair RT @jbendery: About every other House lawmaker I just talked to smelled like booze. It’s only 9pm.

— Sam Stein (@samsteinhp) October 1, 2013

I def saw more than 1 member of congress putting a few back on Penn earlier. Ran into 2 in the liquor store.

— KateNocera (@KateNocera) September 29, 2013

Now I don’t know about you but when millions of people are suffering, partners and children of soldiers who died not getting support, People send on fulough not getting wages they need for food and energy and veterans are rioting in the streets because they are stopped from visiting their war memorials I would not be happy to know the people who are supposed to solve the problems are getting off their rockers as early as that and are partying much like Nero when their country and their dollar are going up in flames!

Here is what it might mean to the rest of the world if the dollar defaults:

A U.S. debt default that lasts for more than a couple of days could potentially cause a financial crash unlike anything that the world has ever seen before.  If the U.S. government purposely wanted to damage the global financial system, the best way that they could do that would be to default on U.S. debt obligations.  A U.S. debt default would cause stocks to crash, would cause bonds to crash, would cause interest rates to soar wildly out of control, would cause a massive credit crunch, and would cause a derivatives panic that would be absolutely unprecedented.  And that would just be for starters.  But don’t just take my word for it.  These are the things that top financial experts all over the planet are saying will happen if there is an extended U.S. debt default.

Because they are so close together, the “government shutdown” and the “debt ceiling deadline” are being confused by many Americans.

As I wrote about the other day, the “partial government shutdown” that we are experiencing right now is pretty much a non-event.  Yeah, some national parks are shut down and some federal workers will have their checks delayed, but it is not the end of the world.  In fact, only about 17 percent of the federal government is actually shut down at the moment.  This “shutdown” could continue for many more weeks and it would not affect the global economy too much.

On the other hand, if the debt ceiling deadline (approximately October 17th) passes without an agreement that would be extremely dangerous.

And if the U.S. government is eventually forced to start delaying interest payments on U.S. debt (which could potentially happen as soon as November), that would be absolutely catastrophic.

Once again, just don’t take my word for it.  The following are 12 very ominous warnings about what a U.S. debt default would mean for the global economy…

#1 Gerald Epstein, a professor of economics at the University of Massachusetts Amherst: “If the US does default, that will make the Lehman Brothers bankruptcy look like a cakewalk”

#2 Tim Bitsberger, a former Treasury official under President George W. Bush: “If we miss an interest payment, that would blow Lehman out of the water”

#3 Peter Tchir, founder of New York-based TF Market Advisors: “Once the system starts to break down related to settlement and payments, then liquidity disappears, as we saw after Lehman”

#4 Bill Isaac, chairman of Cincinnati-based Fifth Third Bancorp: “We can’t even imagine all the things that might happen, just like Henry Paulson couldn’t imagine all the bad things that might happen if he let Lehman go down”

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