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Obama's Budget is Impossible to Finance and Congress Will be Forced to Reject it

By: Steve Johnson

2/4/2010 - 36 Comments

Obama's budget is impossible to finance because our bankers will not give us the requested line of credit.

China, India and Japan don’t have the money to lend us.  They cann't give us the money to borrow and spend if they wanted to.

That means the Treasury will have to print the $1.4T difference. But the Treasury cannot print money any faster than they are already without the world discovering how much money they have been printing for years, which could create a panic sell off. 

If Obama’s budget were to pass the Senate, global investors will sell the dollar and lead to a sinking dollar followed by massive inflation. 

Obama's budget is impossible.  Congress has no choice but to reject it.  Perhaps that was the plan. 

If Congress rejects the budget, they will be forced to negotiate the spending cuts and Obama can say, ‘I did all I could, it’s not my fault’, when the economy completely tanks.

The revenue increases in the Obama budget like the tax increases for international business will also never pass the Senate and the high unemployment rate will reduce the projected tax revenues, resulting in a much higher difference between income and expences.

It’s not going to happen.  2010 is going to be a year of difficult decisions and the begining of massive government spending cuts. 

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What Has Government Done to Our Money?

Rothbard gives us an exceptionally clear, detailed description of what money is and how it has come to be manipulated by governments and central bankers into almost worthless inflationary fiat paper currency. He then explains how gold became the most respected and trustworthy currency of choice and the prospect of either hyperinflation or the greatest depression the world has ever seen may be arriving in the very near future.

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