By Noel Sheppard
Associate Editor, Newsbusters.org

Wall Street got rocked Wednesday by a “debt bomb” economists have worried about for decades.

Hours after the United Kingdom failed to attract enough buyers for its auction of $2.5 billion of 40-year bonds, the United States Treasury had similar difficulties with its sale of $34 billion worth of five-year notes and was forced to raise their interest rate to a much higher yield than had been anticipated.

Such problematic debt offerings came on the heels of Germany having two failed auctions of its bonds already this year.

As Briefing.com reported shortly after our auction ended:

Treasuries were battered on the poor showing on the 5 year auction. The 5-yr was swung off to add over 8 basis points to its yield, while the 7-yr, which has its offering tomorrow, saw a beat down of over 9bps. The market has enough concerns about global supply and this ugly offering of the “relatively” safe, mid-duration notes adds to that jaundiced view.

As a result of this poor showing, stocks, which had been up over 200 points earlier in the day, quickly plummeted to down over 100 (courtesy BigCharts.com):

At the close, the Dow Jones Industrial Average surprisingly managed to close up 90 points in what many are describing as a very strange and volatile day.

However, with the Treasury set to sell $24 billion worth of seven-year notes tomorrow, traders have to be worried about how this will go.

More importantly, so should Americans as such debt offerings will be commonplace as our nation racks up trillion dollar deficits for the foreseeable future. As Bloomberg reported Tuesday:

President Barack Obama’s government is selling record amounts of debt to revive economic growth, service deficits, and cushion the failures in the financial system. Debt sales will almost triple this year to a record $2.5 trillion, according to estimates from Goldman Sachs Group Inc.

Wow. $2.5 trillion in one year.

And, given the Congressional Budget Office’s forecast of over $9 trillion in deficits in the next ten years, our Treasury will likely be auctioning off at least $1 trillion worth of paper a year for quite some time unless radical changes are made to President Obama’s 2010 budget proposal.

This means the decades-old fear of America holding a bond or note auction without enough buyers showing up could be just around the corner.

Will there come a point when we’ll have the same difficulty selling our debt as the U.K. had today and Germany has had twice this year? What happens then?

Sadly, these don’t seem to concern the Obama administration and a Democratic-controlled Congress as they continue to spend money almost faster than it can be printed.

This raises an important question that should be on the mind of every citizen: if it was wrong for Americans to borrow money earlier this decade to purchase a house they couldn’t afford, why are our elected officials seemingly making the very same mistake?

Noel Sheppard is associate editor of the Media Research Center’s NewsBusters.org. He welcomes feedback at nsheppard@newsbusters.org.

By Bill Shuler
Pastor, Capital Life Church, Arlington, Virginia

Beyond having pulled your stocks out of the market before the crash, there are many things that you will never regret:

1. Giving more than you take.

2. Laughing with a child.

3. Taking a principled stand.

4. Rejecting rejection.

5. Investing in the next generation.

6. Honoring the last generation.

7. Reading the best-selling book of all time. (No it’s not Harry Potter)

8. Responding to hate in an opposite spirit.

9. Thanking teachers.

10. Building up treasure where moth and rust cannot destroy.

Some end life having made a living, others come to the end having fully lived. Dare to find out what really matters in life and to worry less about things that don’t. In the words of Scripture, “I have placed before you life and death, therefore choose life.”

Now that Madoff is starting what will eventually become a long stay in the clink, let the post-mortems begin. Would you like to know who were his real accomplices in this affair? It’s a gang that goes by the nickname, the “Securities and Exchange Commission” and it brazenly operates right out in the open in Washington, D.C. And the nature of their fraud? Why, they con the investing public into believing that they’re “protected” against guys like Bernie Madoff!

As a review of Madoff’s case shows, he was investigated multiple times by the SEC but nothing was done despite some tut-tutting in memos. In the years between these various ignored warnings Madoff scammed billions more, much like a serial killer who continues his spree while the cops keep bumbling the investigation. Meanwhile a new generation of Madoffs are probably being born as we speak, all being protected in a sense by the public’s perception that the SEC is going to protect it! (A close reading of SEC statements and internal memos on this affair suggest that the only thing they really protect is their own behinds.)

Here’s a story about Madoff that reached me through one of my investment banking contacts. It seems that several years ago a major New York bank’s trust department (it must go nameless) was approached by Madoff on behalf of a large client.

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By John Tantillo
Marketing and Brand Expert

Folks, first some history. In the early eighties, one of Jimmy Carter’s bright young political advisers, Pat Caddell, landed the plum marketing gig of guiding Coca Cola into the future–and he almost ran that venerable brand into the ground

I’m talking about the “New Coke” debacle. Threatened by Pepsi’s growing market share and driven by data that said that the consumer wanted sweeter drinks, Coca Cola scrapped its time-honored soda formula and introduced New Coke.

Presidents Reagan and Clinton both knew this about their Target Markets: the American people could be stretched, but in the end political marketing was the order of the day: Americans’ fundamental needs and beliefs cannot be forgotten.

The outrage was deafening. People couldn’t believe that their soda was being taken away from them. Coca Cola listened and New Coke is now just a distant memory.

How could all of the polls, surveys and consumer data have been wrong?

Well, they didn’t take into account what really mattered to the consumer: choice and continuity. One more thing –and it’s a biggie– Coke was thinking about cola drinkers not Coke drinkers. It forgot its target market.

So I ask, is President Obama the New Coke?

The electorate seemed to want change in 2008 and Obama seemed to represent the change they wanted. This change was about politicians moving beyond partisanship to get things moving again in Washington –it was not about big government solving everyone’s problems. It wasn’t a Democrat or a Republican that the electorate wanted. No, it was a person of change who would not put the same old practices into political play.

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By Peter Ferrara
Director of Entitlement and Budget Policy, Institute for Policy Innovation/ General Counsel of the American Civil Rights Union

If you expected the rise of the Obama regime to leave conservatives dispirited, you would be wrong. This year’s CPAC was the largest ever, with close to 9,000 in attendance, full of spirited young people ready to fight for the future, as well as long term veterans of the battle.

For me, the highlight of the conference was Newt Gingrich’s speech on Friday at noon. The Republicans have several young stars with a future in the national leadership, but no one today with the commanding presence and the cutting intellect able to redefine the debate and reframe the issues like Gingrich.

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