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Discussion in 'Politics, Religion, Social Issues' started by P-Worm, Aug 5, 2011.
US Debt downgraded to AA+
We're doomed. Discuss.
Knew that was coming....
Bloomberg is false and New China is right
This needed to happen, and to comment the bloomberg puff piece the dollar is not a safe currency.
It was said by china to other countries news agencies and in china's own state news agency "new china" that the world needed a new global, reserve currency.
That china is condemning the shortsighted political climate in the USA and that the US dollar needed to be under international probate.
A new stabile and secure reserve currency should be a possibility to avoid a catastrophe that is made and due to one country
This is what is said by china and not what bloomberg is reporting to the us population.
US loses AAA credit rating.
This is what happens when you let nutjobs hold your country to ransom to preserve their ridiculous tax breaks.
Exactly. This is the ultimate irony: the tea party is now costing the American government money. They've done the opposite of what they intended.
Oh, and just incidentally, it looks like they're going to be costing us money as well.
You know and I know that they're going to try to pin the blame on the White House and Democrats for this. Bachmann and Boehner already are. How the hell they justify it when the S&P downgrade comes immediately on the heels of their debt raise fiasco, I don't know.
American rating agency Moody's is trying to bring Europe economy down, now they are doing the same to their own country. Hope americans can now see they're credit rating agency is absolutely garbage.
PS: I like Obama a lot though
And there you have the spin doctors at work.
It's actually been laughable for the rest of the world to have seen how long the us credit rating agencies have been afraid to take a realistic credit rating for the US.
You need to face your problems and not do as the greece population blame the rest of the world for it. That is what the blame game on the credit institutes are at this time. They are finally trying to do their work right and when they do the blame game starts from everyone that does not want to hear the news that the king is naked.
The global market need credit institutes that use actual ratings and not the blown up ratings that gave us this continuing global crises.
It has always struck me as odd that the various credit rating agencies are allowed to operate as they do,the openings for corrupt dealings on the stock exchanges are enormous (I realise that the opportunity for corruption is wide spread in the share markets but the credit agencies position is ridiculous )
The politics that drive our economic policy have been unrealistic since Reagan, but now they've become totally bat****. Really, who couldn't see something like this coming -- no matter how long it took? The US has been fair begging for a smackdown for some time now.
You're from Portugal? Of course all of your problems were brought along by ratings agencies.
About time ... long overdue.
Is this really a surprise to anyone?
What do you guys make of this?
I agree that it's about time the credit worthiness of America was downgraded, however if an error of $2 trillion was included within the agency's analysis surely it would have to be investigated further?
yes it had to come ,but it started even before kennedy , the American have lived to long on borrowed money from other countries , so gone will be the days of cheap food,fuel , clothing ,Mac's ...for US americans soon they will have to pay the same prices as the rest of that world , and maybe finally
someone is realising it that YOU are not ruled by your elected government , there are others who rule , banks , oil industry,.... and realise that Democracy and Capitalism do not mix well
just like in the rest of that world where governments ask "how high" if the corporations say "jump"
and maybe somone in the governments is realising if you borrow money from those corporations you need to pay it back , and waiting for the next government to pay back the dept is not a clever sollution
someone in one post said dept is a good thing ,and yes it might be if the dept is managed responsible
but our governemts around the world act not responsible , they act not at all in reality
what the US goverment has done now and has for decades can be shown in a very small example :
i go to my bank and ask them for 1 million to build a house , but i make a deal with the bank that my great grandchildren will pay the dept , i intend to pay only the interests , and once i got the money from that bank , i decide it would be nice to spend the money instead on that house it was meant for on a trip around the wold, and then go back to the bank after and ask them for more , that works for a while as long as i got a good credit rating and payed my interests ..... but there has to come one day where someone is asking for the dept to be payed off
The biggest surprise is that the White House is surprised. Playing politics by only agreeing not to default on its loans with a couple of hours to spare is just asking to be downgraded, couldn't they not see what they were doing with their brinkmanship? Rich politicians, through their aspirations of power, will have cost the normal American man and women a lot of money that they can ill afford. Wonder who they will blame for their shortcomings.
If your lucky enough to have cash reserves now may be a good time to convert it all to Yuan (yeah yeah I know gold and baked beans are the way to go ).
Portugal was put through a "bank stress test" by European Bank agencies and passed. Moody's did the same thing and we failed. Coincidence? I think not...
What's that suppose to mean?
Our gov needs to abide by the same principles as it holds its people to. Far gone are the days of living within the means; but the people and the creditors of our nation got bitch slapped for poor lending practices of past.
It's always astounded me (being in the financial sector) for years on how my clients are scrutinized with an 800 credit store and a 32% dti for a loan, yet my nation can run up a tab so large and wide without any sort of consequence.
The CRA, Dodd frank bill, FHA, FNMA, Freddie and the like have been trying to reverse course so far and wide by over correcting its errors and lack of mindset from the past decade.
As my clients (and many of you here) try to buy a home now; tell me, how fun is it? Lending today is not as it was in the past, and that is not a bad thing; however when my government acts like a group of hypicrates and spends and prints money like its toilet paper, well what the hell does any expect.
Two fixes for long term as I see it:
1. Term limits on all elected officials in the USA. Our founding fathers never saw political positions as "careers" they are ther to serve their country, and get back to work in the private sector.
2. See # 1.
Well, money is created as debt. And that debt has to be repaid... plus interest.
So, more money has to be created, as debt, to pay the old debt.
The way the whole system works is that the US has to keep borrowing. I don't think the US can generate enough private debt to keep things ticking over anymore.
If the economy were growing robustly, with an appropriate level of inflation, this wouldn't really be a problem. Bigger economy -> more capacity for debt. Inflation -> existing debt is devalued. I suppose that's almost sustainable... though I think a lot of people realise that a debt based money supply isn't going to function indefinitely - at some point you have to have defaults, collapses, and currency resets as it's all built-in to the system of having to repay more money than is ever created.
But the economy isn't growing robustly, and debt relative to GDP is looking scary. Unfortunately turning off the tap at this point is only likely to make things worse, as you then have a reduction of new money entering the money supply while existing debt, plus interest, has to be repaid.
Perhaps the US needs more quantitative easing in such circumstances. In theory, when the economy picks up and the public and private sectors are borrowing enough to keep the money supply bountiful, the central bank can start selling back the assets. Not that I believe this will ever actually happen...
One thing to note is this. I'm from the UK. We know that 'money' (credit) is built upon borrowing. But we all want other countries to have to be the indebted ones. So it's in my interests for the US to keep borrowing, even when its GDP appears to be struggling to keep up.
Just my thoughts and perceptions... I'm sure you'll all pick a load of holes in it but remember, it's just my opinion, so play nice
Very. We didn't have any problem at al we just got a mortgage that we could afford and paid a nice fat 25% deposit.
I don't think current requirements are unreasonable, in fact they're preferable as too many people seem to over stretch themselves and then act all surprised when they can't afford to keep up with payments.
I personally just wouldn't feel comfortable without paying at least a 20% deposit, house prices can fluctuate and negative equity can really screw you over.
loving this news!
The European bank stress test was unrealistic as it tested only isolated scenarios and didn't consider 'contagion'.
I have more trust in Moody's on this matter.
Glad it worked out well. FYI I should have clarified, I was actually talking about excellent clients with a min of 20% down. Behind the scenes, it's not so pretty-
I have never believed in the over extend yourself model; I have always declined that business.
Why? If your American it's bad news for you, if you are not, it's still bad news for you. What happens in America, like it or not affects the rest of the world.