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'No Risk': More Words for Geithner to Eat

Written by: Chris Markowski 06/27/12 - 2:41 PM EDT
NEW YORK (TheStreet) -- There are two ways to conquer and enslave a country. One is by the sword. The other is by debt. -- John Adams

Back in February, Senator Paul Ryan from Wisconsin challenged Treasury Secretary Timothy Geithner, asking why the Obama administration is not making any attempt to solve the long-term debt problem.

Geithner's response was a "take your breath away" moment of honesty, rarely heard from government officials, "You are right to say we're not coming before you today to say 'we have a definitive solution to that long-term problem.' What we do know is, we don't like yours."

Another one of our Treasury Secretary's greatest hits was in April of this year when he was asked; "If we don't deal with these debt problems we are going to be Greece in two years?"

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Geithner responded, "No risk of that."

I thought to myself after hearing those comments that I had heard that before, and sure enough in April 2011 Geithner was asked, "Is there a risk that the United States could lose its AAA credit rating? Yes or no?"

Geithner responded, "No risk of that."

Watchdog on Wall Street Life Lesson #124. Beware of anyone from the big Wall Street firms or any Washington, D.C. politician/bureaucrat that tells you there is "no risk." There is a very strong chance that they are full of bull excrement.

Every January on the radio show I read a column on air that I penned back in 1999 titled "Crystal Ball." Around that time of year, along with corny jewelry commercials and Lexus advertisements, I get really sick and tired of all the silly predictions that are provided to us by the media from their cast of "Wizards of Smart."

From "Hot Stocks for 2012" to "How to Get Rich This Year in These Sectors," the ridiculousness never seems to end. The point behind my article is that nobody can tell what is going to happen in the future, but one most certainly can have a good idea of what will happen next by studying the past. So I give you a highly abridged and brief history of debt...

The Romans issued a gold coin called the Aureus. The face value of the original coin equated to the market value of gold in it. The Romans, much like the U.S. and other nations today spent money haphazardly that they didn't have: public subsidies, military expenditures, public works and a huge government bureaucracy. The rulers of the Roman Empire raised taxes and minted more coins to pay their bills. Coins were issued with less gold and over time the people lost faith in the currency.