Page 1 of 2 12 LastLast
Results 1 to 10 of 15

Thread: S&P downgrades US credit rating

  1. #1
    Join, or Die nonsqtr's Avatar
    Joined
    Jan 2008
    Posts
    32,903
    Thanks
    4667

    From
    Vertiform City

    S&P downgrades US credit rating

    S&P downgrades U.S. credit rating - latimes.com

    Well folks, here it is. The nightmare has begun. The market crashed, and by most accounts it hasn't bottomed out yet. Gold is way up, no one trusts the government anymore, and pretty soon no one will trust the corporations either (they're trying another round of layoffs right now, we'll see where that gets them). Times are tough. Those little "brought to you by the National Reconstruction & Recovery Act" signs are going to become collector's items.

    (either that or they won't be able to get a buck for 'em on eBay)...

  2. #2
    Emperor of Earth muffins's Avatar
    Joined
    Feb 2010
    Posts
    564
    Thanks
    3

    Peter Barnes “Is there a risk that the United States could lose its AAA credit rating? Yes or no?”

    Tim Geithner’s response: “No risk of that.”

    “No risk?” Barnes asked.

    “No risk,” Geithner said.
    LINK (video)

    You know when they're lying. Their lips move.

  3. #3
    Trumpaloompa Tormenter Cicero's Avatar
    Joined
    Dec 2010
    Posts
    36,825
    Thanks
    23802

    From
    Virginia
    Quote Originally Posted by nonsqtr View Post
    S&P downgrades U.S. credit rating - latimes.com

    Well folks, here it is. The nightmare has begun. The market crashed, and by most accounts it hasn't bottomed out yet. Gold is way up, no one trusts the government anymore, and pretty soon no one will trust the corporations either (they're trying another round of layoffs right now, we'll see where that gets them). Times are tough. Those little "brought to you by the National Reconstruction & Recovery Act" signs are going to become collector's items.

    (either that or they won't be able to get a buck for 'em on eBay)...
    Well, it remains to be seen how this plays out. My sense of this issue is that the right will use it (short term) to dismantle Social Security, Medicare, and Medicaid in the 2012 Budget. Veterans benefits will also be decimated. Federal wages and benefits will be slashed. 15% of the federal workforce will be let go (notice I didn't say "contract workforce"). Unemployment and foodstamps will be cut.

  4. #4
    Emperor of Earth muffins's Avatar
    Joined
    Feb 2010
    Posts
    564
    Thanks
    3

    Quote Originally Posted by Cicero View Post
    Well, it remains to be seen how this plays out. My sense of this issue is that the right will use it (short term) to dismantle Social Security, Medicare, and Medicaid in the 2012 Budget. Veterans benefits will also be decimated. Federal wages and benefits will be slashed. 15% of the federal workforce will be let go (notice I didn't say "contract workforce"). Unemployment and foodstamps will be cut.
    I think they will only do that if circumstances force them to, as was the case with Greece. Politicians want to be re-elected, which they won't be if there are mass riots in the streets, so they'll print and print like Russia/Argentina/Turkey/Zimbabwe did and hope for a miracle that doesn't come. All they will get is hyperinflation.



    Cuts? What cuts? Expenditure will still be growing.

  5. #5
    Trumpaloompa Tormenter Cicero's Avatar
    Joined
    Dec 2010
    Posts
    36,825
    Thanks
    23802

    From
    Virginia
    Quote Originally Posted by muffins View Post
    I think they will only do that if circumstances force them to, as was the case with Greece. Politicians want to be re-elected, which they won't be if there are mass riots in the streets, so they'll print and print like Russia/Argentina/Turkey/Zimbabwe did and hope for a miracle that doesn't come. All they will get is hyperinflation.

    Cuts? What cuts? Expenditure will still be growing.
    I absolutely disagree. These are programs the right has been trying to dismantle since Ronald Reagan and now the ideologues will see their chance. The military, and empire, will be the only "jobs program" available, so don't count on the government to keep its promise to bring the troops home.

  6. #6
    Emperor of Earth muffins's Avatar
    Joined
    Feb 2010
    Posts
    564
    Thanks
    3

    Quote Originally Posted by Cicero View Post
    I absolutely disagree. These are programs the right has been trying to dismantle since Ronald Reagan and now the ideologues will see their chance. The military, and empire, will be the only "jobs program" available, so don't count on the government to keep its promise to bring the troops home.
    The spending gap is some 40%. Will even the ideologues be able to cut spending/raise taxes to cover that gaping hole? If they only manage to close the gap to 10%, there will be much uproar/loss of votes AND the debt problem will still be getting worse, not better.

    This is why, one way or the other, they will keep printing.

  7. #7
    Trumpaloompa Tormenter Cicero's Avatar
    Joined
    Dec 2010
    Posts
    36,825
    Thanks
    23802

    From
    Virginia
    Quote Originally Posted by muffins View Post
    The spending gap is some 40%. Will even the ideologues be able to cut spending/raise taxes to cover that gaping hole? If they only manage to close the gap to 10%, there will be much uproar/loss of votes AND the debt problem will still be getting worse, not better.

    This is why, one way or the other, they will keep printing.
    I see the problem now. You are assuming that anything they do will be about fixing the deficit. That's not my underlying assumption. I'm assuming that the political opportunists will seize this opportunity to do what they want to do because the downgrade gives them cover.

  8. #8
    Emperor of Earth muffins's Avatar
    Joined
    Feb 2010
    Posts
    564
    Thanks
    3

    Quote Originally Posted by Cicero View Post
    I see the problem now. You are assuming that anything they do will be about fixing the deficit. That's not my underlying assumption. I'm assuming that the political opportunists will seize this opportunity to do what they want to do because the downgrade gives them cover.
    *bursts out laughing*

    They had a massively bitter spat over, what was in the end, "cuts" that will merely slow the growth of the debt by the merest sliver. If they don't fix the problem of needing to finance spending with debt then it will be all over for the dollar as a reserve currency, and as a currency.

    I don't believe they have the political will to deal with the problem.

    The two sides in the US are so preoccupied with fighting over the steering wheel that they can't see that the car is speeding towards a cliff edge.
    China, the largest creditor of the world's sole superpower, has every right now to demand the United States to address its structural debt problems and ensure the safety of China's dollar assets.

    It should also stop its old practice of letting its domestic electoral politics take the global economy hostage and rely on the deep pockets of major surplus countries to make up for its perennial deficits.

    A little self-discipline would not be too uncomfortable for the United States, the world's largest economy and issuer of international reserve currency, to bear.

    International supervision over the issue of U.S. dollars should be introduced and a new, stable and secured global reserve currency may also be an option to avert a catastrophe caused by any single country.

    For centuries, it was the exuberant energy and innovation that has sustained America's role in the world and maintained investors' confidence in dollar assets. But now, mounting debts and ridiculous political wrestling in Washington have damaged America's image abroad.

    All Americans, both beltway politicians and those on Main Street, have to do some serious soul-searching to bring their country back from a potential financial abyss.
    http://www.zerohedge.com/news/gloati...lobal-reserve-

    They're giving the US its final warning.
    Last edited by muffins; 6th August 2011 at 10:45 AM.

  9. #9
    Trumpaloompa Tormenter Cicero's Avatar
    Joined
    Dec 2010
    Posts
    36,825
    Thanks
    23802

    From
    Virginia
    Quote Originally Posted by muffins View Post
    *bursts out laughing*

    They had a massively bitter spat over, what was in the end, "cuts" that will merely slow the growth of the debt by the merest sliver. If they don't fix the problem of needing to finance spending with debt then it will be all over for the dollar as a reserve currency, and as a currency.

    I don't believe they have the political will to deal with the problem.

    The two sides in the US are so preoccupied with fighting over the steering wheel that they can't see that the car is speeding towards a cliff edge.


    http://www.zerohedge.com/news/gloati...lobal-reserve-

    They're giving the US its final warning.
    No, they had a massively bitter fight over how to avoid responsibility. It is not now, and never has been about the debt...even for the Teaparty congress critters (who went from cut, cut, cut, to show me the graft in under six months). It's about not being blamed for the hard choices that have to be made. Like it or not hard choices ARE coming, and no one in Congress is capable of making them. Do we choose to help the unemployed, the elderly, or the veterans? We can only have one program, so which will it be? Are we willing to bear the true cost of eliminating or severely constraining the other two programs? What of the wars in Iraq and Afghanistan? Are these wars within our means now? What are we willing to give up, at home, to give "democracy" to these countries? What of our global empire? What are we willing to give up, at home, to fund military bases throughout the world? What of our standing army and navy? Can we afford them now or must we accept the policy of deescalation? What about DHS? Just how effective is it? What are we willing to give up to keep it as it stands? Can we afford to subisidize businesses through corporate welfare? Can we afford to subsidize reproduction and home ownership? What are we willing to give up to keep these things?

    THESE are the hard issues...not NPR, planned parenthood, or gay marriage.

  10. #10
    Emperor of Earth muffins's Avatar
    Joined
    Feb 2010
    Posts
    564
    Thanks
    3

    Quote Originally Posted by Cicero View Post
    No, they had a massively bitter fight over how to avoid responsibility. It is not now, and never has been about the debt...even for the Teaparty congress critters (who went from cut, cut, cut, to show me the graft in under six months). It's about not being blamed for the hard choices that have to be made. Like it or not hard choices ARE coming, and no one in Congress is capable of making them. Do we choose to help the unemployed, the elderly, or the veterans? We can only have one program, so which will it be? Are we willing to bear the true cost of eliminating or severely constraining the other two programs? What of the wars in Iraq and Afghanistan? Are these wars within our means now? What are we willing to give up, at home, to give "democracy" to these countries? What of our global empire? What are we willing to give up, at home, to fund military bases throughout the world? What of our standing army and navy? Can we afford them now or must we accept the policy of deescalation? What about DHS? Just how effective is it? What are we willing to give up to keep it as it stands? Can we afford to subisidize businesses through corporate welfare? Can we afford to subsidize reproduction and home ownership? What are we willing to give up to keep these things?

    THESE are the hard issues...not NPR, planned parenthood, or gay marriage.
    This is why politicians always opt for the easy solution - the printing press. Argentina, Yugoslavia, Turkey, Zimbabwe, Russia ... in each case the politicians took the easy route and papered over their funding gaps with the printing press. Hyperinflation followed.

Page 1 of 2 12 LastLast

Tags for this Thread


Facebook Twitter RSS Feed