"U.S.A. may be bankrupt," by Leonard Curry, United Press International. Washington. June 6, 1974!Submitted by JSBach on Fri, 07/01/2011 - 18:46
From 'The Seattle Times', Thursday, June 6, 1974, page 1:
"U.S.A. may be bankrupt," by Leonard Curry, United Press International. Washington.
"The federal government may have quietly gone bankrupt this week. "It's only a technicality," a Treasury official said.
"Actually, we can hold on for about two weeks, but it gets hairy."
The Treasury probably reached the legal debt ceiling of $475.7 billion last Saturday and depleted its cash balance yesterday.
No one knows officially because the government reports what it has spent about six days after the money is gone. But the Treasury Department said yesterday the debt had risen to $475.6 billion and cash on hand had shrunk to $7.5 billion last Friday.
When the debt ceiling - imposed by Congress - is reached, the government can't borrow any more money.
But no one expects it to go out of business.
If the federal government has gone temporarily bankrupt, a series of steps will be taken by Treasury Secretary William E. Simon. These will include orders to halt sales of Series E and H savings bond, Treasury bill and other securities. In order to raise money, the Treasury could call on the Export-Import Bank to repay its loans from the United States.
The administration's proposal to raise the debt ceiling to $495 billion has passed the House, but is stalled in the Senate, where liberals are trying to win approval of tax-reform amendments.
In any case, if the government can juggle its books until July 1 it will be in the clear. A new fiscal year and a new spending budget begin then, opening up a new flow of cash."
Now, let me think... did they actually rely upon congress back then to provide them with more debt ceiling...?
... or was the Fed just at it totally behind the scenes!?!
In any case it was too offensive to discuss the fraudulent creation of money openly, especially so soon after defaulting on the gold obligations, in Breton Woods II of 1971, which opened the door of fiat money's 'Alice in Wonderland'.