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Geithner Asks Congress For Higher U.s. Debt Limit

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Geithner asks Congress for higher U.S. debt limit

U.S. Treasury Secretary Timothy Geithner formally requested that Congress raise the $12.1 trillion statutory debt limit on Friday, saying that it could be breached as early as mid-October.

"It is critically important that Congress act before the limit is reached so that citizens and investors here and around the world can remain confident that the United States will always meet its obligations," Geithner said in a letter to Senate Majority Leader Harry Reid that was obtained by Reuters.

A Treasury spokeswoman declined to comment on the letter.

Treasury officials earlier this week said that the debt limit, last raised in February when the $787 billion economic stimulus legislation was passed, would be hit sometime in the October-December quarter. Geithner's letter said the breach could be two weeks into that period, just as the 2010 fiscal year is getting underway.

The latest request comes as the Treasury is ramping up borrowing to unprecedented levels to fund stimulus and financial bailout programs and cope with a deep recession that has devastated tax revenues.

It is expected to issue net new debt of as much as $2 trillion in the 2009 fiscal year ended September 30 and up to $1.6 trillion in the 2010 fiscal year, according to bond dealer forecasts.

The request to increase the debt limit will likely raise the ire of Republicans who have accused President Barack Obama of runaway spending. They may try to hold up the legislation in effort to win concessions on Obama's health care reform plan.

Geithner urged Reid to not let politics hamper U.S. credit-worthiness and said he looked forward to working with the Nevada Democrat to secure enactment of legislation on the debt limit as early as possible.

"Congress has never failed to raise the debt limit when necessary. Because members of both parties have long recognized the need to keep politics away from this issue, these actions have traditionally received bipartisan support," he wrote. "This is clearly a moment in our history that calls for continuation of that tradition."

The headline made the words 'printy printy' pop out of my mouth, flavoured with the 'state failure' meme.

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I'm shocked.

Theres a debt limt?

There is a debt limit. It seems to be to-day's outstanding debt + 1 trillion and gets readjusted every time to-day's debt approaches the limit.

It was one of those silly laws passed to make everyone feel like they were being fiscally responsible when it is actually a toothless law.

Edited by LuckyOne

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I'm shocked.

Theres a debt limt?

A made up number to make it look all very official and planned.

They believe it so hope the rest of us do too.

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Can we do this with the alcohol limit?

Everytime I'm approaching breaking it we can just readjust so it doesn't matter, I can then go and drive?

This is just insane, what's the point of having limits if your just going to keep moving the goal posts.

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Guest spp
""It is critically important that Congress act before the limit is reached so that citizens and investors here and around the world can remain confident that the United States will always meet its obligations,"

Let me get this right...this is like me telling my credit card company to increase my limit so that I don't miss any payments??

Talk about crazy!!!

:ph34r:

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Let me get this right...this is like me telling my credit card company to increase my limit so that I don't miss any payments??

Talk about crazy!!!

:ph34r:

It's laughable. The whole thing is hanging together with scotch tape now.

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It's laughable. The whole thing is hanging together with scotch tape now.

Exactly. And we all know what happens to scoth tape when it gets drowned in liquidity ......

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