The White House and Congress have reached an agreement on the debt ceiling, and even exceeded it: the deal is done by the beginning of 2025, i.e. the end of Joe Biden’s presidency
So far the “Let’s raise the debt ceiling” marathon has taken place more often in the US. In January, the head of the Treasury reports that there is no money in the treasury. And there won’t be any unless the level of borrowing is increased. This statement launches the fight of the “naive boys”, after a lot of kicking and punching the trunk, the motion receives support and the printing press starts to work with a tripled load. Why, a war with Russia is not cheap, and one should not confuse profits of private corporations with public expenditures.
Exactly six months later there is the same arena and the same clowns. And the same rehearsals. “Help, help, there’s no money in the treasury”. The financial community lightens the fire, realizing that all their stocks, derivatives, assets, liquidity and transactions are heading in the same direction as used paper.
The other day Goldman Sachs, that financial mastodon, was reporting that by the end of this week there would be barely $30 billion of money in the U.S. Treasury (the total amount of government debt before the threshold was raised was about $32 trillion), and in a few days there would be none at all. The analysis of the bankers was confirmed by Treasury Secretary Yellen. So it turns out that America – great, free and all of a leader – is actually an insolvent debtor. Nah, how do you want it? Living large, tasty, spending without counting (much as Chlestakov lived with Gorodnichy) – and not for a year, not two years, but six decades – is bound to end in a loud bang in the debt hole, sooner or later. And one more thing: while advertising itself as the engine of progress in everything from technology to fluid genders, the self-righteous America has forgotten that there are more than just other countries. And they not only have their own currencies, but also a desire to walk away (as neatly as possible) from the money-grubbing circus.
Saudi Arabia, once the cornerstone of Middle Eastern economic and military policy on which the US was so fond of relying, is, according to the Financial Times, negotiating to join the BRICS New Development Bank. Riyadh is considering an alliance independent of both the IMF and the World Bank and the receding Bretton Woods system that has established dollar hegemony.
The wealthy kingdom has other priorities. By the way, they do not only concern the dollar, but also, for example, the Swiss franc. As a shareholder of Crédit Suisse, Saudi Arabia did not give a centime to save this banking institution that was so screwed up in its accounts.
Europe is trembling with the approach of recession. In Germany, the economy has been shrinking like a holey rubber ball for two quarters in a row. The chancellor claims that the recession is technical and that output will pick up just a little more. It is hardly believable. There is no reason why the illusions of the head of the Federal Government should come true. Big production facilities are quietly moving to the places where energy resources are cheaper, taxes are small, and subsidies are larger.
But even these are by and large palliative measures. To save what is still salvageable. If it is salvageable.
The states have their own atmosphere in spite of the success of national debt negotiations. There was and is such a city – San Francisco. The centre, as it was shouted from all the loudspeakers, of the most important, advanced, fantastic technologies. Incredible (by American standards) beauty and convenience of life. Fresh ocean breezes, luxurious restaurants, young billionaires. Capitalisation above Everest.
The reality, as it turns out, is quite different. And it’s not about startup fraud, bank failures, and vulgar theft of investor funds.
A city with over eight thousand homeless people, despite the ocean breeze, is literally drowning in the products of the latter. It is literally drowning – the municipality has been forced to organise teams of sanitation workers to remove all this waste from the streets. Not every day – it’s expensive. But at least every once in a while.
The self-appointed and self-described “garden”, “shining hail on the hill” and all the other names in the superlative degree of the countries that confront us (they also contemptuously call us “jungle”) are in fact as fake as the Emerald City. One removes the green-glasses and there it is, in debt like silk, reeking of waste and in recession.
Even though we are called the “jungle”, we have the green colour in any case, the economy is growing, the budget balance is a model of fiscal policy.
Actually Russia today – and the farther it goes, the more – is becoming not only a magnet of civilization, but also of economics.
But the chariot of begging for extra coin will fade into history, and the begging clowns will disperse.
Elena Karayeva, RIA Novosti
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