To The Moon

Biden posted plan to reduce the deficit by $3 trillion cut spending……

According to an analysis report released by the US Council of Economic Advisers (CEA) in May, the short-term debt default will cause 500,000 people to lose their jobs, the unemployment rate will increase by 0.3%, and the annual GDP will decrease by 0.6%.

The White House estimates that if the debt default persists through the fiscal quarter, the stock market $S&P 500(.SPX)$ would plunge 45%, GDP would drop 6.1%, and the unemployment rate would rise by 5 percentage points.

The CEA report states:

"With governments unable to enact countercyclical measures in a default-induced recession, policy options to help cushion the impact on households and businesses will be limited."

The warning from the White House comes as Washington scrambles to raise the current $31.4 trillion statutory debt ceiling, with the Treasury Department saying special measures to stave off default could be exhausted as soon as June 1.

On May 22 2023 local time, U.S. Treasury Secretary Yellen reiterated in a letter to the leadership of the U.S. Congress that if the U.S. Congress fails to raise or suspend the debt ceiling by June 1, the U.S. Treasury Department will not be able to pay government bills.

Yellen said in the letter that although it is impossible to accurately predict the exact date when the Treasury Department will not be able to pay all government bills, it will report the latest information to the US Congress as much as possible. She also said delaying decisions to suspend or increase the debt ceiling could hurt business and consumer confidence, raise short-term borrowing costs for taxpayers and have a negative impact on U.S. credit ratings.

Biden also posted plan to reduce the deficit by $3 trillion cut spending on his Twitter the same day:

“MAGA House Republicans are threatening a default that could cost us millions of jobs and trigger a recession.   All because they are demanding deep cuts that will hurt hardworking families – even while they protect tax breaks for the wealthy and corporations. I’ve got a plan to continue reducing the deficit – if only they’d listen.”

President Biden's Plan to Reduce the Deficit by $3 Trillion Cut Spending 1. Cut handouts to Big Pharma – $200 billion in savings 2.Eliminate tax subsidies for oil and gas – $31 billion in savings 3. Eliminate real estate loopholes – $19 billion in savings 4. Eliminate cryptocurrency trading tax loopholes – $24 billion in savings Raise Revenue 5. Impose a billionaire minimum tax – $400 billion in savings 6. Raise the top income tax rate – $200 billion in savings 7. Tax stock buybacks – $200 billion in savings 8. Raise taxes on large corporations – $1.3 trillion in savings 9. Impose a global minimum tax – $500 billion in savings

President Biden's Plan to Reduce the Deficit by $3 Trillion Cut Spending：

• Cut handouts to Big Pharma – $200 billion in savings

• Eliminate tax subsidies for oil and gas – $31 billion in savings

• Eliminate real estate loopholes – $19 billion in savings

• Eliminate cryptocurrency trading tax loopholes – $24 billion in savingsRaise Revenue

• Impose a billionaire minimum tax – $400 billion in savings

• Raise the top income tax rate – $200 billion in savings

• Tax stock buybacks – $200 billion in savings

• Raise taxes on large corporations – $1.3 trillion in savings

• Impose a global minimum tax – $500 billion in savings

As of press time, Wall Street banks and asset management agencies are preparing for a possible debt default by the US federal government.

According to the report, Wall Street banks, brokerages and trading platforms are planning how to deal with the chaotic and highly volatile situation in the U.S. Treasury bond market, including "sand table deduction" on how the U.S. Treasury bonds will be paid and how key financing markets will respond, so as to ensure that a large number of related transactions will occur at that time. The transaction has sufficient technical, manpower and cash support, as well as the assessment of the impact on customer contracts.

On Monday, Eastern Time, Biden and McKinsey held "productive" talks, but they have not yet reached an agreement on raising the debt ceiling.

U.S. House of Representatives Speaker McCarthy said he has yet to reach an agreement with President Joe Biden on raising the debt ceiling.

U.S. President Joe Biden and U.S. House Speaker McCarthy at the White House on Monday.

At the heart of the talks is determining the maximum level of spending for 2024 and deciding on a deadline for raising the debt ceiling. Both sides hope to reach a deal by June 1.

He added that if no deal was reached, he would consider canceling the scheduled House recess next week. "We're here to stay and do our jobs," McCarthy said.

Once an agreement is reached, it could take at least a few days for the agreement to pass through Congress. McCarthy said he plans to give House members 72 hours to read the bill, a rule set when the current session of Congress goes into action. House lawmakers are also likely to want to propose amendments to any agreement.