I'd like to go on record for calling something in case it ends up materializing.

If the debt ceiling is not raised, the Fed will use some "extraordinary measures" to monetize government spending instead of government debt. Perhaps some sort of non-marketable intragovernmental "special issue" bonds that are similar to the SS trust fund, but different enough as to not fit the definition of intragovernmental debt, which is a component of gross debt to which the ceiling applies. Perhaps nothing other than an interest in averting calamity, and maintaining control could be enough for the Fed could monetize government spending in exchange for no securities.

Not an endorsement, only recognizing it as a possibility. Bankers have been controlling governments since the Medici. The accounting of how to achieve that control is rather unimportant. While there would be accounting differences from what is already happening, and certainly the potential for markets to react negatively to it, the economic differences would be no different than what has already been happening for almost two years now.

Except for the reference to middle earth types (which junior staff person wrote *that* ?)... McCain has become the voice of reason. This prospect is almost as scary as Boehner getting away with being portrayed as a moderate but comared to the idalogues who managed to get themselves elected... perhaps he is?

All that said... we *do* need to cut spending but we ALSO need to reinstate taxation at the higher levels of income. There is no getting around t.

The discussion of Constitutional Amendments can be deferred until well after the crisis