James Rickards is a four time best selling author of books such as Currency Wars and the Death of Money. While known somewhat deservedly as a ‘gold-bug,’ Mr. Rickards is an accomplished financial analyst and has had a storied carrier in law and finance going back to the Long Term Capital Management crisis and the Russian financial crisis in 1998. Mr. Rickards sat down with Greg Hunter of USA Watchdog for a wide ranging interview that spans Mr. Rickards belief that a serious economic crisis is brewing, his views on the Trump Administration, and, of most immediate interest, his concerns over a so-called ‘spending ceiling.’
Mr Rickards points out that in addition to the debt ceiling that was reached on March 15th, the federal government is running into a ‘spending ceiling’:
“Every year we have a budget, but believe it or not the government works on a fiscal year. The Government doesn’t have a January 1st year. The government has a year that actually starts on October 1st and ends on September 30th. So you are supposed to have you new budget ready by September 30th but the Congress never does. It really drags on into the next calendar year. So here we are into the spring of 2017 and we don’t have a budget yet for the year we are in right now. So how do you deal with that? Well the Congress passes what they call a continuing resolution, CR for short… What is says is that the government can keep spending what they spent the year before but they can’t spend anymore and they can’t spend it on anything new. That gets you through part of the year and then sometime before… the middle of the year, they pass a new budget and that’s where you get the new spending that comes along. So right now we are operating under a continuing resolution. That expires April 28th… just a couple weeks away. If you hit that and you don’t extend the continuing resolution, the government can’t spend. It’s not even a question of if you can borrow. That’s one problem. You can’t even spend and the government shuts down… The last time we had these government shut downs was 2012.”
“So you say well wait a second. Republicans are in complete control… can’t they just do this, and the answer is maybe not. because again a lot of this comes back to this planned parenthood thing. The House Freedom Caucus says we are not going to sign up for the continuing resolution unless you defund planned parenthood but that will never make it past the Senate because you have a filibuster and you’ll never get any Democratic support for that. So you could be looking at another government shutdown.”
There is a whole lot more to the interview so please enjoy it below.
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