Nuke The Debt Ceiling!

Joe Biden gets on board with an idea whose time is coming - use the Senate 'nuclear option' to put debt ceiling legislation beyond the filibuster. Both parties have done this with judges and Cocaine Mitch says he is fine with raising the debt ceiling as long as there are no Republican votes backing it.

Prior to the crushing defeats in the Georgia Senate run-offs that gave Sen. Schumer 50 votes in the Senate, Republicans warned that in such a scenario Democrats would end the filibuster entirely and squeeze through bills on DC statehood and an expanded Supreme Court with 50 votes plus VP Harris. Sen. Manchin has rejected that concept but he was apparently silent on nuking the filibuster:

Senate Democrats discussed carving out the exception at their weekly lunch on Tuesday. No conclusions were reached, but notably, according to participants, the two strongest opponents of filibuster changes, Senators Joe Manchin III of West Virginia and Kyrsten Sinema of Arizona, did not speak up in protest. They also did not speak up in support.

This debt ceiling stand-off will be resolved with a gimmicky trick play. My current guess ranks the nuclear option at Number One because it is quick and no more politically painful than reconciliation. Reconciliation is my second guess - its cumbersome and uses a scarce resource since per the current Senate "rules" (LOL) the Dems can only use it twice per session. (Their current plan is to use their second Reconciliation Card on the shrinking $3.5 trillion Social Justice and More bill, but they may do that next January in a new session.)

My third choice is a gadget play to be named later. The fourth choice last gasp is the Trillion Dollar Platinum coin. I don't think the coin is "legal" within the spirit of the law but in the current environment the real question is, can Treasury and Fed lawyers agree its 'legal enough', given the dire alternatives? As a recent example of this mentality, Biden extended the CDC eviction moratorium knowing the courts would eventually shoot it down (The Supreme Court did so, three weeks later.)

As to the platinum coin, I agree with this from Krugman:

Would any of these approaches basically mean using silly gimmicks to avoid catastrophe? Possibly yes. But given the stakes, who cares if the approach sounds silly?

Would using any of these gimmicks involve violating the spirit of the law even if they technically obey the letter? Of course — but Republicans are already doing that through their abuse of the debt ceiling.

Would any attempt to do an end run around the debt ceiling face court challenges? Yes. But the legal process would at the very least buy time to devise a better solution.

Well, yes - the trillion dollar coin is a terrible idea (per SecTreas Yellen!) but maybe not compared to the other terrible ideas on the menu. As to legal challenges, there is a real question about just who might have standing to sue if a coin were issued.

We should find out soon enough. My money is on nukes.

ERRATA: Rohan Grey, a young progressive professor, has a solid piece on the legal background to a platinum coin. We chatted on Twitter and I came away agreeing that the coin is legal enough that Federal Reserve lawyers could make a political decision to go either way. On the one had, I'd say that accepting the coin calls into question their independence. OTOH, rejecting it puts them in the role of refereeing a partisan Executive-Legislative showdown during a bond market meltdown. Both paths are perilous.

 

Comments

[Neo]

Former Central Banker Says US Economy Already In Recession
https://www.zerohedge.com/markets/former-central-banker-says-us-economy-already-recession
Economy peaked March 2021
Entered recession Sept 2021

That “Big Guy” is so efficient

[Narciso]

i think we've already seen this story

https://www.zerohedge.com/geopolitical/financial-times-says-europeans-should-prepare-demographic-replenishment-arabs-and?

[Narciso]

oh

https://www.dailymail.co.uk/news/article-10075917/Gallery-selling-Hunters-art-saw-federal-COVID-loan-rise-150k-500k-Biden-took-office.html

[DCSCA]

Trump riffing in Iowa; airing on Newsmax.

What. A. Show.

Puts Teleprompter Joe to shame.

[DCSCA]

'DISPATCHES FROM THE EDUCATION APOCALYPSE: A Renowned Composer Showed His Class Othello Featuring Laurence Olivier. Students Led A Revolt And Now He’s Accused Of Racism.'

Of course it’s offensive; Larry’s 1965 ‘Othello’ is a ‘slap in the face’ -black or brown- compared to the much better 1951 film of ‘Othello’ w/a brownfaced Orson Welles, that he produced and starred in. Welles’ film, BTW, California’s SDSU TeeVee channel aired this weekend.

Now 'Breakfast At Tiffany's' -with a buck-toothed Mickey Rooney playing a Japanese, or a Tony Randall and a Peter Sellers playing Chinese or Indian in various films; or Mel Brooks as an indin chief in Blazing Saddles... etc., THAT'S racism, ain't it. Or is it art? Let's ask Hunter Biden.

But the ultimate slap in the face is where no real man had gone before: Nimoy playing a green blooded, pointy earred VULCAN---- THAT'S despicable! ;-)

[Davod]

DCSCA. But I thought Larry got back to his roots when he played the Mahdi in Khartoum.

[DCSCA]

@Davod: LOL! But defaced himself when he did Polaroids commercials. ;-)

'Face it'-- Larry Olivier is no Al Jolson.

Or Larry Parks. ;-)

[Davod]

Found at Ace:

I'm not sure how many coffees it takes to be happy, but so far it's not twelve.

[MissMarple2]

Great rally!

All-time record in attendance at the fairgrounds. Endorsed Grassley. Cheered me up tremendously!

[Davod]

Also found at ACE.

From gang bangers to football stadiums, Joe is loved by all.

[DCSCA]

@Davod. 'I'm not sure how many coffees it takes to be happy, but so far it's not twelve.'

Light or dark? Racism special brews are percolating all through society this week. ;-)

[Davod]

Also found at ACE (1:30)

Demonstrations of police being attacked with a knife from different positions and distances.

This is educational.

[Davod]

The link would be helpful.

I should have mentioned that the scenarios are unrehearsed, and the police officers do not know what to expect.

https://twitter.com/i/status/1446508235519893508

[MissMarple2]

Josh Barnett for Congress (AZ-06)
@BarnettforAZ

· 36m
Last 6 months in Antarctica have been coldest on record

[MissMarple2]

The Epoch Times
@EpochTimes
·
13m
President Biden signed into law a bill that provides funding for the treatment of US officials who have suffered brain injuries and other symptoms consistent with what’s known as “#HavanaSyndrome,” the source of which remains a mystery.

[MissMarple2]

Heading to bed.

Good night, all!

[jim nj]

https://nypost.com/2021/10/09/nyc-drug-store-shelves-empty-amid-shoplifting-surge/

"Thanks to a citywide shoplifting tsunami, bare necessities are now rare luxuries on drug-store shelves across New York City.

“It looks like the Third World,” bemoaned one Manhattan resident, after eyeing the aisles of a CVS on Sixth Avenue in Soho desperately low of toothpaste, face wash and hand sanitizer, among a long list of other items.

“They’ve all been stolen,” a CVS employee told The Post."

California-style shoplifting hits the Big Apple.

Talk about supply chain issues - these kinds of stores re-stock based on what their point of sale registers relay back to their warehouses.

If the stuff doesn't get scanned at the register as far as the supply chain is concerned it's still in the store and doesn't need to be restocked.

After awhile, without a manual intervention, the shelves remain empty of the most popular shoplifted items.

Which leads to some interesting thoughts. Why restock your most shoplifted items? Do the crooks just move on to the next most popular items instead? How many low-level crooks do you need, acting in concert, to create a black market for goods that people need to access the black market to get the goods no longer available in the stores?

[jim nj]

cross-posting

CCGirl on JOM2 has been mentioning the difficulty of keeping paint in stock in her hardware store.

She thought the companies might be having trouble getting enough cans for the product.

That made sense to me until I started thinking about it a little more.

Breweries had a problem when the bars and restaurants closed getting product to market because they had to switch from kegs to a lot more cans all of a sudden.

So maybe it's not containers because enough time has gone by to adapt to a container problem.

So what's specific about paint? Well it's basically glue with pigment. It's petrochemical, competing with all the other adhesive products out there that need the same feed-stock.

And I thought about the Texas deep freeze and Hurricane Ida.

Hmm.

https://www.usatoday.com/story/money/reviewed/2021/10/01/where-buy-paint-online-home-depot-lowes-amazon-and-more/5934912001/

Experts predict a paint shortage in the U.S.—here's where to buy it before it sells out

"According to Sherwin-Williams' CEO John Morikis, the industry is struggling to keep up with high demand after Hurricane Ida halted production of some of the key chemicals and resins needed to make paint."

https://www.marketplace.org/2021/09/29/heres-another-shortage-to-add-to-the-list-paint/

Here’s another shortage to add to the list: paint

"A mix of factors, from an unusual freeze in Texas to ongoing supply chain issues with raw materials like resin, have resulted in a paint shortage."

So they talked to a painting contractor: "Well, I like to think that we’re well prepared at my company. So, we have great suppliers and vendors. Unfortunately, if you came to our shop, I’m looking at about 500 gallons of untinted paint sitting on pallets; just so we’re prepared for our customers, we’re ordering in very large quantities of paint."

"The only problem with that is — there’s many different suppliers and we all know them — paint is not all the same; you can’t just grab one gallon of paint and go to another vendor and grab another gallon of paint and it performs the same way. So not only are we seeing issues with paints we haven’t used before. It has also slowed down our production, our labor, because they’re using new paints. It requires different paintbrushes. They all perform differently. It’s been been a learning curve all around, not even to mention just the shortage of materials."

So paint is glue, but it's not all the same glue. If you anticipate a shortage you can hoard whatever you can get, but they may not take pigment or apply the same way.

[clarice]

https://www.americanthinker.com/articles/2021/10/green_policies_return_the_world_to_coal.html
Good morning, JOM!

[Jim Eagle]

Clarice,

About 20 years ago, I wrote a paper I delivered to the annual meeting of the Public Power Association and published in their journal that warned of destablizing the electric power system by reducing coal fuel generation. Those big coal fired power stations you see are what is called "base load generators". IOW up to 80 and 90 percent of the power consumed is from those steady state stations.

Using a RAMS (reliability, avaiability, maintainability) analysis comparing nuclear, coal, oil, gas and renewables, only nuclear and coal deliver quantum required. Hasn't changed much to this day. Look at California relying on magic and mirrors versus lets say Ohio, Kentucky, Pennsylvania with majority coal fired base load stations.

I have a gut feeling Public Utility boards, Power Generating Utilities and other parts of the domestic energy community are looking again at coal. The technology for emissions cleaning has been here for decades and all it takes is a little political spine.

[Ignatz Ratzkiwatzki]

JiB,
Do they have technology for scrubbing CO2, which they consider satanic? At this point, some of these weirdos are probably read to burn coal without controlling emissions because they think the aerosols will inhibit the warming, the dreadful warming ready to kill us all...by rising a couple of degrees.
Idiots.

[Jim Eagle]

Iggy,

Yes on CO2 scrubbers but mostly at the retail level not the power generation level. Then there is CO2 storage for bigger quantities.

[Ignatz Ratzkiwatzki]

So if the Japanese want carriers why didn't we sell them the Kitty Hawk and the JFK? Pretty sure we could have got more than one penny each.
Just call them defensive carriers and they're legal under their Constitution.

[clarice]

Iggy, Cal already asked for and got permission to ignore emission standards for coal powered electrical generating plants because they now need them to avoid blackouts. Get it--no nuclear or gas power, back to coal and the hell with emission standards. I feel like I've fallen into a rabbit hole with Alice.

[Buckeye]

Using a RAMS (reliability, avaiability, maintainability) analysis comparing nuclear, coal, oil, gas and renewables, only nuclear and coal deliver quantum required. Hasn't changed much to this day. Look at California relying on magic and mirrors versus lets say Ohio, Kentucky, Pennsylvania with majority coal fired base load stations.

Not to mention that, at least in Ahia, my juice costs less than a nickel per KWH.

[Melinda]

And that gets you to Steyer.

Meanwhile,

A study on economic benefits of High Speed Rail asks some very interesting questions:

Michael Pettis
@michaelxpettis
1/7
Very interesting article. A series of Chinese studies may be discovering something about the high-speed rail system that France had already learned: rather than boost the economies of secondary cities, being connected...

scmp.com/news/china/sci… via @SCMPNews

https://twitter.com/michaelxpettis/status/1447132721604661248

https://www.scmp.com/news/china/science/article/3151775/there-dark-side-chinas-high-speed-rail-network

SCMP Alert, bring salt.

[Melinda]

From last July, before crypto mining was banned, the largest user of electricity in China by any measure::

If coal is dead, then why are ships so full of it?
Seaborne coal has been a key driver of 2021’s dry bulk shipping resurgence

https://www.freightwaves.com/news/if-coal-is-dead-why-are-all-those-ships-so-full-of-it/

Also, keep in mind that for a stretch of time, China was accepting full colliers and tankers as payment for production contracts. Those ships full of those commodities remain at anchor outside of Chinese ports, to this day.

From just now, the red dots are the anchored oil tankers, just off Quanzhou:

https://www.marinetraffic.com/en/ais/home/centerx:119.1/centery:25.0/zoom:10

I'll see if I can split off the Capesize colliers.....

[Melinda]

"Draught", on each ship's detail when you click on the dot, tells a lot about whether the ship is full of cargo, or idled at anchor.

I need to be a subscriber to their service to break out the Capesize types for coal, and I'm not.

[Melinda]

They have state owned corporations to manage commodity use:

CN Wire
@Sino_Market
China National Cotton Reserves Corporation: Government departments analyzing measures to prevent hoarding and speculation of auctioned cotton reserves to ensure policy effectiveness.
#China #cotton

CN Wire @Sino_Market
JUST IN:
China to release cotton from national reserves in Oct & Nov, starting Oct 8.
#cotton #China

https://twitter.com/Sino_Market/status/1447189735517028362

[Narciso]

because the goal is scarcity and starvation, to destroy the western way of life, this was schwabs pitch, maybe soros signed on the 90s,

[Melinda]

Also, shutting down primary domestic coal sources due to flooding might put a crimp on the normal course of business.

[Jim Eagle]

Don't forget that tomorrow is Indisgenous Peoples Day. If you see one, thank them for giving you anogther day off.

[Narciso]

shirley they can't be serious,

[Narciso]

oh really

https://twitchy.com/samj-3930/2021/10/10/gosh-it-looks-like-southwest-airlines-may-have-tried-to-cover-up-the-massive-anti-mandate-sickout-that-impacted-1000-flights/

[MissMarple2]

Quelle suprise...

[MissMarple2]

https://amgreatness.com/2021/10/09/well-conquer-that-one-too/

Alfred Regnery writes about conquering the Grand Teton with Angelo Codevilla.

[matt - deplore me if you must]

So all of those electric cars in China and Europe won't be able to recharge this winter. And gas stations in the UK have run out of go juice. This all started with F Joe Biden's EO's the first day he was in office. That was when the supply/demand curve got knocked out of whack.

China's petulance with Australian coal dates back further, but Putin saw a real opportunity to knock the Euros for a loop when Biden was elected as well. The drop in wind power everywhere except Brussels and Strasbourg didn't help.

In talking with German friends the Greens are only now beginning to be blamed for the Kluster*ckerei that is beginning.

It's going to be a long cold winter of discontent for a lot of people. Let's hope that our country can avoid this man made catastrophe.

[clarice]

Let's hope that the blame for this catastrophe will be placed where it belongs:On the loony greens and the politicians who catered to this lunacy.

[Melinda]

John Kass
@John_Kass
What really happened to Chicago? The Democrats happened. My column from the blue belly of the beast, a dying city, in a corrupt county, in the worst run state in America. @nypost
nypost.com/2021/10/07/get…

https://twitter.com/John_Kass/status/1446877797562126346

https://nypost.com/2021/10/07/get-real-joe-the-democrats-let-chicago-go-to-ruin/

[Rick Ballard]

Matt,

The Green Death could make Wuflu look like post nasal drip for China and especially the EU.

[Ignatz Ratzkiwatzki]

What I think will happen is the progs will blame the problems on capitalism. And their solution will be MORE solar and wind. It's obvious right? If we don't have enough juice then we just need more of what is supposed to make juice [but isn't]. And since money is no object MORE we will have.
Meanwhile, since the crafty progs make sure to leave enough free market around to be useful, the sky high prices will eventually bring on supply, but capitalism will get the blame anyway and the mere plans to ramp up even MORE boondoggles will get the credit.
Socialism means never having to say "I'm a sorry dumbass".

[Len]

NEW