A former White House Budget Director has warned that the U.S. Treasury could run out of money by June 2017, sparking riots and civil unrest across America.
According to an interview with David Stockman, a controversial deal made between former Speaker of the House John Boehner and former President Barack Obama in 2015, will result in the “mother of all debt ceiling crises,” by the summer of 2017 which will see a giant “fiscal bloodbath” for Americans.
“I think what people are missing is this date, March 15th 2017. That’s the day that this debt ceiling holiday that Obama and Boehner put together right before the last election in October of 2015.
That holiday expires. The debt ceiling will freeze in at $20 trillion. It will then be law. It will be a hard stop.
The Treasury will have roughly $200 billion in cash. We are burning cash at a $75 billion a month rate. By summer, they will be out of cash. Then we will be in the mother of all debt ceiling crises. Everything will grind to a halt. I think we will have a government shutdown. There will not be Obama Care repeal and replace.
There will be no tax cut. There will be no infrastructure stimulus. There will be just one giant fiscal bloodbath over a debt ceiling that has to be increased and no one wants to vote for.”
With about $200 Billion in cash on-hand, and with the Treasury burning through about $75 Billion a month, this means the United States government will run out of cash sometime in June. Stockman says:
In a typical month we have 250 to 300 billion in revenue coming in… that will easily cover the debt service for a month… that will readily cover social security and other critical payments… but when it comes to paying grants to state and local governments, contractors, or the Army Corp of Engineers, or the Pentagon, or a whole range of other activities, if you don’t have the cash you put the bills in the drawer…
I think that is what’s going to shock the system… and it will scare the living bejeezus out of Wall Street and financial marketsbecause then you won’t have a sudden clarification or resolution to the problem.. and that could go on for days and weeks.
This is going to be a maelstrom like we’ve never seen before and the markets are not even remotely prepared for this… Fundamentals don’t matter anymore… nothing is being discounted… it’s all raging robo-machines and day traders thinking that somebody is going to come to their rescue no matter how absurd the bubble gets or how extended the whole system becomes.
Stockman claims the fall out will be fast and unprecedented in its scale. He goes on to say:
There is going to be a recession… and there is going to be no stimulus left to bail it out… and neither Trump or the Wall Street gamblers even remotely understand.
I see [President Trump] as the great disruptor… I don’t see him as someone who is going to bring about a solution… We have to have the system blow up first for all practical purposes… I think he does not yet understand the magnitude of the problem… the incorrigibility of what he’s inherited.
…He doesn’t realize that this problem he is inheriting is a thousand times greater than anything he ever imagined… this is a monster.
Everything leaks and we’re learning in the Trump administration they’re as leak-prone as any I have seen… so it’s all going to leak out… and the stock market…the casino… is going to begin to realize the fact that there is no plan…there is no big fiscal stimulus… the whole system is heading into some kind of crash landing and that’s going to change the manic delusions that are underway today.
While no one in Congress wants to vote to increase the debt ceiling, there really is no choice.
But Congress may have another agenda – getting rid of Trump. And they may just be willing to allow this catastrophe to happen so they can blame it on Trump!
But what Congress may not bank on, is that Trump sees what’s coming and may just start issuing LAYOFF Notices to vast swaths of the federal government BEFORE the cash runs out.
At that point, Trump will have done what is necessary, and blaming him won’t work.
Then, too, let’s just examine for a moment, what it would mean if Food Stamps (SNAP), Welfare, Section 8, and the like, all end in June. By July, the savages will be on the rampage nationwide because their EBT Cards are useless!
But perhaps that’s the plan? Perhaps it is long overdue for a complete meltdown of American society in its present form? From June, forward – after the bloodbath — only the strong would survive. Maybe that’s what some are looking to do?
Stay tuned, folks, this could get ugly.