Rick Santelli gives his perspective on the deficit and debt limits. Basically, you MUST cut spending else we’ll just dig a bigger hole and have a harder time getting out of it in two years all while looking more and more like Greece. Another misconception that he nailed is we don’t have to increase the debt limit by August to avoid a default. As an example, if you pay your mortgage (our debt), but you don’t go buy an iPhone or steak dinners, you can’t default on the debt. We have plenty of revenue to cover the interest payments, but we need to cut spending or simply not pay another bill(s), that is the sad reality. One of the few individuals on CNBC that I consider a voice of reason and tries to explain how the bond market is a key driver in all of this we face and how it will determine what will take place. The reality is the two parties are not willing to have the tough discussions that would alienate each of their voter bases (therefore their power). With that being said, it will be much tougher to actually have the right discussions (like Santelli tries to create) among the key decision-making individuals that need to be leading these discussions. Without those discussions, it becomes more of a game of luck in fixing our issues rather than creating the best strategy that minimizes as much pain for the people as possible. Let’s be realistic though, pain is inevitable. If we are not realistic, we may only make matters worse over the coming years.
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