{"id":24717,"date":"2017-08-18T12:18:50","date_gmt":"2017-08-18T17:18:50","guid":{"rendered":"http:\/\/olduvai.ca\/?p=24717"},"modified":"2017-08-18T12:18:50","modified_gmt":"2017-08-18T17:18:50","slug":"why-there-will-be-no-11th-hour-debt-ceiling-deal","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=24717","title":{"rendered":"Why There Will Be No 11th Hour Debt Ceiling Deal"},"content":{"rendered":"

Why There Will Be No 11th Hour Debt Ceiling Deal<\/a><\/h3>\n
\n

\"\"<\/a>A new milestone on the American populaces\u2019 collective pursuit of insolvency was reached this week.\u00a0 According to a report<\/a>published on Tuesday by the Federal Reserve Bank of New York, total U.S. household debt jumped to a new record high of $12.84 trillion during the second quarter.\u00a0 This included an increase of $552 billion from a year ago.<\/p>\n

Moreover, this marked the second consecutive record high on a quarterly reported basis for U.S. household debt.\u00a0 Indeed, this is a momentous achievement.\u00a0 From our vantage point, it is significant for several reasons.<\/p>\n

One, it shows U.S. household debt has returned to its upward trend which had previously gone uninterrupted from the close of World War II until the onset of the Financial Crisis in late 2008.\u00a0 Second, it demonstrates that, like the S&P 500, new all-time highs are being attained with the seeming precision of a quartz clock.\u00a0 Is this just a coincidence?<\/p>\n

More than likely, it\u2019s no coincidence at all.\u00a0 More than likely, the mass quantities of central bank liquidity that have been injected into the financial system over the last decade have provided the plentiful gushers of cheap credit that have pushed up both stock prices and household debt levels.<\/span>\u00a0 But remember, the easy stock market gains can quickly recede while the increased debt must first drown the borrowers before it can be expunged.<\/p>\n

To understand where the liquidity has come from, look no further than the total combined assets<\/a> of the Federal Reserve, European Central Bank, and the Bank of Japan. \u00a0They were around $4 trillion a decade ago.\u00a0 Today, they\u2019re over $13.8 trillion.\u00a0 And if you include the People\u2019s Bank of China\u2019s assets, combined major central bank assets jump to nearly $19 trillion.<\/p>\n

…click on the above link to read the rest of the article…<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Why There Will Be No 11th Hour Debt Ceiling Deal A new milestone on the American populaces\u2019 collective pursuit of insolvency was reached this week.\u00a0 According to a reportpublished on Tuesday by the Federal Reserve Bank of New York, total U.S. household debt jumped to a new record high of $12.84 trillion during the second […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[195,15640,303,8222,11763,827,834,10147,3650,15639],"class_list":["post-24717","post","type-post","status-publish","format-standard","hentry","category-economics","tag-debt","tag-economicprism-com","tag-fed","tag-great-financial-crisis","tag-mn-gordon","tag-united-states","tag-us","tag-us-debt-ceiling","tag-us-federal-reserve","tag-us-household-debt"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/24717","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=24717"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/24717\/revisions"}],"predecessor-version":[{"id":24718,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/24717\/revisions\/24718"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=24717"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=24717"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=24717"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}