It's Official: DTS Discloses Total Debt Hit Ceiling Yesterday; Government Draws On $14.3 Billion From Retirement Funds 

Submitted by Tyler Durden on 05/17/2011 16:16 -0400
While it won't be a surprise to anyone at this point, seeing it in black on white is about as startling as hearing that one's credit card has been denied. Yesterday, following the settlement of all of last week's auctions, total debt held by the public increased by$51.4 billion, just as we had predicted, bringing the total to $9.717694 trillion. And with the total debt subject to the ceiling maxed out legally by $14.294, Tim Geithner reported a total of $14,293,975 MM, $25 million away from the ceiling. What was the plug? Why "Intragovernment Holdings" of course, which declined by $14.3 billion. As Tim Geithner warned yesterday this is now money held in retirement trust funds, which is now being directly sacrificed in order to keep the ceiling from breach: "I will be unable to invest fully the portion of the Civil Service Retirement and Disability Fund (“CSRDF”) not immediately required to pay beneficiaries. In addition, I am notifying you, as required under 5 U.S.C. § 8438(h)(2), of my determination that, by reason of the statutory debt limit, I will be unable to invest fully the Government Securities Investment Fund (“G Fund”) of the Federal Employees’ Retirement System in interest-bearing securities of the United States." And as expected, once the debt ceiling is raised, the accrued shortfall will be filled, meaning upon a debt ceiling hike, which will come some time in July, total debt will explode higher, surging by about $300 billion in a few days




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Does DSK Have The Syph? Strauss-Kahn Housed In Facility For Inmates With Contagious Diseases 

Just when you thought the humiliation couldn't get any worse... 

 

 

 

 

Another Woman Steps Up: Former Employee Sent Letter To IMF, Warning Organization About DSK Following Her Own Affair 

Submitted by Tyler Durden on 05/17/2011 15:24 -0400

And so another woman appears on the DSK scene, so far unnamed. As AP reports, "An employee who had a brief affair with IMF chief Dominique Strauss-Kahn warned the organization about his behavior toward women in a letter sent three years ago." And no, this is no the Hungarian Piroska Nagy who almost caused the downfall of DSK if only the bailout crew had had enough brains to do a little more to the "head" than censure him. But it appears that the two are close: "The person who confirmed the existence of the letter is close to the former International Monetary Fund employee, Hungarian-born economist Piroska Nagy. The person declined to be identified, citing the sensitivity of the matter." As a reminder the so far only known major transgression of DSK, Nagy, had worked at the IMF for decades, and left the organization after the affair with Strauss-Kahn in 2008. An IMF-funded investigation into the affair cleared Strauss-Kahn of wrongdoing but criticized his judgment. If it now turns out that the IMF had been officially warned about DSK, yet completely ignored the charges, we may have another public humiliation ala the SEC and Bernie Madoff, which ultimately will strip the organization of even more "bailout" and dollar-alternative power. Which begs the question: just how far will the powers that be go to make sure the SDR concept is now and forever killed as a USD-replacement currency?

April Vehicle Assembly Rate Collapses, May Industrial Production Estimates To Be Cut 

Submitted by Tyler Durden on 05/17/2011 13:50 -0400

As if today's disappointing announcement of slowing Industrial Production was not enough for all those still hoping for a hockeystick to the economy, we now get an update from Stone McCarthy which looks at the latest Wards Automotive data and sees what apparently nobody has factored into their models yet. In a nutshell, the annualized April motor vehicle assembly plunged at a 12% rate from 8.923 million in March to just 7.847, the lowest reading in all of 2011. From SMRA: "In the past, such a sizable drop in the assembly rate has usually translated into a sharp decline in motor vehicle output. We project motor vehicle output to decline by 9% in April, which would be entirely consistent with the drop-off in the assembly rate." The immediate impact: the drop in the industrial production already seen, but the bulk of it due to delayed aftereffects will likely impact the May number, as the follow through from the Japanese supply chain halt starts ringing a loud alarm bell across Wall Street. Of course, this is another thing that all those calling for a 4% H2 GDP could have absolutely not foreseen (and in fact it was originally supposed to be positive for the economy, eh Deutsche Bank?). Expect to see drastic downward cuts to May Industrial Production and next, to Q2 GDP.