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S&P lowers its sovereign credit rating for the U.S. from AAA to AA+. "The downgrade reflects...

S&P lowers its sovereign credit rating for the U.S. from AAA to AA+. "The downgrade reflects our opinion that the fiscal consolidation plan that Congress and the Administration recently agreed to falls short of what, in our view, would be necessary to stabilize the government's medium-term debt dynamics."
Comments (268)
  • Yokyok
    , contributor
    Comments (326) | Send Message
     
    *#(@ 'em
    5 Aug 2011, 08:52 PM Reply Like
  • lowemoran
    , contributor
    Comments (130) | Send Message
     
    Happy now socialists?

     

    Charge with Treason the telemprompter in chief, parrot of krugman and community organizer with Treason!
    5 Aug 2011, 09:54 PM Reply Like
  • davidbdc
    , contributor
    Comments (3150) | Send Message
     
    Actually if it forces a public outcry and then an actual reforming of the entitlement fiasco then we'll need to send them a thank-you card.

     

    If anything these guys should be criticized for taking so long to point out the obvious. And I don't agree that its simply Obama's fault. He hasn't helped matters, but we've had nearly 12 years of politicians telling people whatever they think they ywant to hear, instead of the truth. The result has been massive, massive spending, the creation of a simply ridiculous public bureaucracy, new entitlement programs, and the abdication of any sort of responsible leadership.

     

    Obama deserves the blame for the stimulus boondoggle. He deserves the blame for the financial reform package that doesn't reform anything. He deserves the blame for ignoring his own debt commission and proposing a ludicrous budget this year. He's near the front of the line, but he isn't alone.

     

    In 2012 the people need to vote for independents. Both parties are bought and paid for by groups and people that will willingly lead the country to ruin if it benefits them personally.
    5 Aug 2011, 10:32 PM Reply Like
  • joppinkaru
    , contributor
    Comments (4) | Send Message
     
    Obama proposed a budget...?
    6 Aug 2011, 01:13 PM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    Okay, the Teabaggers block every attempt to to get to the 4 trillion the President wanted and it's the "socialists" fault.

     

    Well, your not a "Rocket Scientist" working for NASA are you?
    6 Aug 2011, 01:32 PM Reply Like
  • Papaswamp
    , contributor
    Comments (2195) | Send Message
     
    Last I checked…congress makes the spending and tax laws.

     

    just a bit of food for thought…
    en.wikipedia.org/wiki/...
    6 Aug 2011, 01:52 PM Reply Like
  • John_DeVita
    , contributor
    Comments (180) | Send Message
     
    There is one easy solution to knock all the politics out of the ratings agencies, force all "Ratings Agencies" to sell CDS for AAA ratings. An agency can't rate something AAA unless they are selling the CDS for it.

     

    I believe come Monday you may find some additional short term demand for CDS on US Treasury, here's a hint, the guys selling them for anytime up until the 2012 election are simply %100 profit, as the new debt ceiling lasts until then.
    6 Aug 2011, 02:54 PM Reply Like
  • kcr357
    , contributor
    Comments (557) | Send Message
     
    Yeah, it was right after he swung down from a nightstalker helicopter and put a bullet in bin ladens head.
    6 Aug 2011, 04:19 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    Yeah, he told us as much in a press conference.

     

    And I quote:

     

    "I've been busy. I've been doing my job! Been doing the Afghanistan thing. Been doing the Bin Laden. What have you guys(to Paul Ryan) been doing?"

     

    Genius wrapped up in a blankey of smartz.
    6 Aug 2011, 04:27 PM Reply Like
  • maximummarketeye
    , contributor
    Comments (9) | Send Message
     
    last I checked, Obama pushed HIS healthcare law and HIS agenda down the american people's throat. You can't deny Obama's entire administration has been characterized by uncertainty in regulation and business.
    6 Aug 2011, 11:14 PM Reply Like
  • Papaswamp
    , contributor
    Comments (2195) | Send Message
     
    @max
    Obama didn't write it. Sen. Max Baucus wrote the majority of the bill or rather had other write it for him. Most notably Liz Fowler former VP of Wellpoint. Senate version is the version that passed with most items in tact.
    Obama is just along for the ride..he doesn't come up with anything himself…he speaks….that's it. His Chief of staff and others run the show.
    7 Aug 2011, 12:35 AM Reply Like
  • Windsun33
    , contributor
    Comments (4265) | Send Message
     
    "..Teabaggers block every attempt to to get to the 4 trillion the President wanted.."

     

    And how do you know that? Did you ever see his plan?

     

    If you did, you are the only one. All I heard was rhetoric.
    7 Aug 2011, 05:28 AM Reply Like
  • lowemoran
    , contributor
    Comments (130) | Send Message
     
    I pray to God, so He can protect us from the socialists and Obama

     

    God Bless America.
    7 Aug 2011, 08:48 AM Reply Like
  • Guardian3981
    , contributor
    Comments (1954) | Send Message
     
    I should of held my sds shorts, I sold at 3:55pm thinking a big EU announcement over the weekend may rally the markets Monday. Anyone holding a short position at close today will probably make a killing Monday, I wish I held...
    5 Aug 2011, 08:54 PM Reply Like
  • Papaswamp
    , contributor
    Comments (2195) | Send Message
     
    don't worry…they will probably re-revise due to 'new' information and re-instate the Aaa rating.
    5 Aug 2011, 10:01 PM Reply Like
  • Tomcat101
    , contributor
    Comments (963) | Send Message
     
    We'll probably rally instead since that uncertainty is taken care of now.
    5 Aug 2011, 10:17 PM Reply Like
  • Thumper517
    , contributor
    Comments (8) | Send Message
     
    Downgrade no surprise here. It's already baked in the market.
    5 Aug 2011, 11:04 PM Reply Like
  • laogao
    , contributor
    Comments (88) | Send Message
     
    You're where I was a week ago, after selling my SSO puts quite profitably (but nothing like what I'd jave made by holding on through the debt deal and into this week).
    Can't wait to see if I'll end up with any money at all on Monday afternoon; I expect another 500+ points down day.
    6 Aug 2011, 12:06 AM Reply Like
  • coddy0
    , contributor
    Comments (1182) | Send Message
     
    Guardian3981
    Anyone holding a short position at close today will probably make a killing Monday, I wish I held...
    ======================...
    Not necessarily true

     

    IMHO
    It is not unthinkable that what appears as news to us is not news to Market.
    Gap down on Monday could be the opportunity to buy/cover
    6 Aug 2011, 12:59 AM Reply Like
  • Stone Fox Capital
    , contributor
    Comments (5945) | Send Message
     
    This was the biggest non event in history. Your correct that it takes one less uncertainty off the table. Maybe we can move on now. This might just kick the EU into gear this weekend to implement a massive bond buying play for Italy and Spain.
    6 Aug 2011, 01:02 AM Reply Like
  • Stone Fox Capital
    , contributor
    Comments (5945) | Send Message
     
    Not sure we'll even have a gap down. Japan hasn't been impacted by a downgrade. Spent all week thinking the US would get a downgrade. This could be one more of the all clears for the market to rally. Assuming the EU gets its act together.
    6 Aug 2011, 01:03 AM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    I think so too. It doesn't mean s#!+
    6 Aug 2011, 03:05 AM Reply Like
  • maximummarketeye
    , contributor
    Comments (9) | Send Message
     
    I will be selling hard into any rally
    6 Aug 2011, 11:18 PM Reply Like
  • maximummarketeye
    , contributor
    Comments (9) | Send Message
     
    To think the market will take this as a positive is beyond me. There is no uncertainty taken off the table, only more uncertainty now. We don't know what the full ramifications of of a ratings downgrade are. How many margin calls because of this? How many bond funds trade based off of AAA ratings? Is this going to effect capital ratios at Euro banks? A ratings downgrade is the same thing as the Fed coming out and raising rates. Of course the market is going to sell off big time. Especially since there is so much uncertainty with it. Beyond that, the problem still isn't solved. Congress kicked the can down the road a whole year! That is another year of Wall Street worry and uncertainty with the debt ceiling.
    6 Aug 2011, 11:53 PM Reply Like
  • maximummarketeye
    , contributor
    Comments (9) | Send Message
     
    The only thing that causes the markets to open up are some very very strong actions by the Fed or a deal between treasury and S&P.
    6 Aug 2011, 11:55 PM Reply Like
  • JohnBinTN
    , contributor
    Comments (3629) | Send Message
     
    I pay more attention to the quarterly earnings and guidance of the companies I own, than to this whole political song and dance sideshow.

     

    It's great to be an investor and not a trader sometimes (always?).
    7 Aug 2011, 12:08 AM Reply Like
  • Joe Morgan
    , contributor
    Comments (1500) | Send Message
     
    This is the result of irresponsible spending for decades and the subsequent parasitism we fostered.
    5 Aug 2011, 08:57 PM Reply Like
  • Lebarjo
    , contributor
    Comments (36) | Send Message
     
    For decades? Revisionist history doesn't go well with people who pay attention. Just 10 years ago, we were in danger of paying off the debt. That's why we had the Bush tax cuts. Add the unfunded Medicare Part D, all the wars, and the Great Recession, and you have our debt.
    5 Aug 2011, 09:12 PM Reply Like
  • Windsun33
    , contributor
    Comments (4265) | Send Message
     
    "..Just 10 years ago, we were in danger of paying off the debt.."

     

    Sorry, if you want revisionism, that is one example. We ran a budget surplus - the debt continued to grow. And 90% of that budget surplus was from the dot.com bubble. Look at the total tax receipts at the peak and just after the bubble burst.

     

    So yes, it was the *decades* of "spending your way to prosperity" that caused this.
    5 Aug 2011, 09:24 PM Reply Like
  • Lebarjo
    , contributor
    Comments (36) | Send Message
     
    "But, the Fed head said, "the most recent projections, granted their tentativeness, nonetheless make clear that the highly desirable goal of paying off the federal debt is in reach before the end of the decade."

     

    And that could be a bad thing.

     

    Running surpluses without a debt, Greenspan warned, would result in the "longer-term fiscal policy issue" of a government paying off its debt, particularly long-term Treasury bonds, before the bonds mature — costing it extra money by buying back those securities from private investors before they mature. Which is very expensive — better to buy back only matured bonds, which won't be possible until at least 2011."

     

    www.time.com/time/nati...
    5 Aug 2011, 09:32 PM Reply Like
  • lowemoran
    , contributor
    Comments (130) | Send Message
     
    NASDAQ bubble....as in Unsustainable growth and Unsustainable receipts...

     

    Obama has racketed more than 4T debt in just three years.....

     

    With another couple of trillions next year.....
    5 Aug 2011, 09:59 PM Reply Like
  • JB1982
    , contributor
    Comments (100) | Send Message
     
    When Bush took over we already had a debt of over $5 Trillion. When he left it stood at about $10 T and now it's up to $14 T.

     

    So, yes, the debt was built up over decades.

     

    As for paying off the debt we were only in danger of paying it off over a decade according to projections that proved erronious in many ways.

     

    Also why do you call medicare part D "unfunded"?!? If it is unfunded then by deffinition it would not have added to the debt... seems like you are just throwing around talking points to prove a political point.
    5 Aug 2011, 10:09 PM Reply Like
  • Lebarjo
    , contributor
    Comments (36) | Send Message
     
    Unfunded refers to not providing a way to pay for it. Its cost goes to debt. We were on the verge of paying off the debt. That is why Greenspan testified to Congress that we needed the Bush tax cuts. It's history. Sorry if it conflicts with your worldview.
    5 Aug 2011, 10:18 PM Reply Like
  • JB1982
    , contributor
    Comments (100) | Send Message
     
    I do not consider over a period of a decade to be "on the verge" as the past decade was full of unpredictable events. Did the CBO add into it's projections the added cost of terrorism and hurricane Katrina? I think not.

     

    Even if the Bush tax cuts and spending increases didn't happen it's unlikely that the deficit would have been completely paid off.

     

    gregmankiw.blogspot.co...

     

    Bush racked up some horrible deficits but to maintain that it's all his fault is just silly.
    5 Aug 2011, 10:36 PM Reply Like
  • Phill Stone
    , contributor
    Comments (78) | Send Message
     
    exactly. we went from budget surplus to aa+ in 11 years. My, how the time flies...
    5 Aug 2011, 10:36 PM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    Phill....during which time spending growth out paced revenue growth by 100% (6% annually vs. 3% annually)
    5 Aug 2011, 10:38 PM Reply Like
  • Lebarjo
    , contributor
    Comments (36) | Send Message
     
    Mankiw was Bush's economist. I don't expect him to take responsibility for anything.
    5 Aug 2011, 10:41 PM Reply Like
  • Phill Stone
    , contributor
    Comments (78) | Send Message
     
    yea, cause some moron thought it was a good idea to lower taxes. It's like G bush didnt WANT a surplus... like that is a bad thing or w/e. He disgusts me.
    5 Aug 2011, 10:41 PM Reply Like
  • bigbenorr
    , contributor
    Comments (757) | Send Message
     
    It is always a good idea to lower taxes. The government should not run a surplus, they are not a business.
    5 Aug 2011, 11:57 PM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    Geez Joe I agree with you again!

     

    The upper 5% and corporations have been sucking the blood from the middle class for decades.
    6 Aug 2011, 03:07 AM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    The NOT SO FISCALLY CONSERVATIVE REPUBLICANS have a very short memory. They just stand around saying, "What did I do?"
    6 Aug 2011, 03:10 AM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    While I have to agree with you regarding the debt at the end of the Clinton administration. You failed to acknowledge that we were on the right path to getting our financial house in order.

     

    The Bush.
    6 Aug 2011, 03:12 AM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    Easy explanation. Bush tax cuts,stagnant job creation, and stagnant wages during Bushes tenure.

     

    Yep, he's an American hero!
    6 Aug 2011, 01:10 PM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    Lets see now. How about saving for a "rainy day", or a recession, or a disaster? How about investing in the infrastructure that business relies on to move goods and materials, or highways that enable the people to get around? If we weren't in a deficit situation to begin with the Republicans wouldn't be able to complain=complain-comp... about the necessary spending President Obama did to pull our asses out of a depression.
    6 Aug 2011, 01:16 PM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    Phill....I gues you couldn't deduce the conclusion from my comment that spending rose TWICE as fast as the rate of inflation, consequently government size grew by 3%-4% per year in real terms....was that necessary? Did we have to spend that money to protect the poppy fields or what?

     

    Certainly you can't be so naive as to believe that it makes any difference which party is in office?
    7 Aug 2011, 10:29 AM Reply Like
  • CautiousInvestor
    , contributor
    Comments (3032) | Send Message
     
    I'm surprised they changed it so little given our lack of leadership, paralyzing economic policies and glaring inability to come to grips with the largest long term problem facing the country and economy.

     

    Interesting link:

     

    investment-income.net/...
    5 Aug 2011, 09:02 PM Reply Like
  • CautiousInvestor
    , contributor
    Comments (3032) | Send Message
     
    just read this:

     

    Richard Haass, the President of the primer Foreign Policy organization, the Council on Foreign Relations President, has repeatedly argued that the nation's growing debt is the greatest national security threat the country faces. As Yale diplomatic historian Paul Kennedy has convincingly demonstrated, the rise and fall of great powers since the time of the Roman Empire has been driven by the economic vitality of the country. Countries that aren't economically dynamic can't maintain large military. Traditionally, the red line has been when debt-to-GDP ratio reached 90%. At this level, it was difficult to reign in debt as growth remained stagnant if not decreased altogether. 100% is therefore quite worrisome indeed.

     

    It's also worth looking at which countries that puts the United States in a league with. According to Agence French-Presse the only countries besides the United States to have a public debt-GDP ratio of 100% are "Japan (229 percent), Greece (152 percent), Jamaica (137 percent), Lebanon (134 percent), Italy (120 percent), Ireland (114 percent) and Iceland (103 percent)."
    5 Aug 2011, 09:44 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    Hmm. One side wanted more cuts. The other side didn't.

     

    I'll let you figger out which one was which.

     

    This was to be expected. The S&P said we needed a min. of $4 trillion in cuts. We didn't get close to that. Thanks Harry Reid. That was fun.
    5 Aug 2011, 09:03 PM Reply Like
  • catamount
    , contributor
    Comments (374) | Send Message
     
    If we could only cut your SS and Medicare, we'd be clear sailing...
    5 Aug 2011, 09:18 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    As long as I don't have to pay into ponzi-at-threat-of imprisonment... fine.

     

    Sign me up yesterday.

     

    I want out of America's stupid entitlement tribe.
    5 Aug 2011, 09:20 PM Reply Like
  • Poor Texan
    , contributor
    Comments (3529) | Send Message
     
    How about switching government employees over to social security and banning double dipping (Gov't pension and Social Security).
    5 Aug 2011, 09:22 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    Melikes that.
    5 Aug 2011, 09:24 PM Reply Like
  • Windsun33
    , contributor
    Comments (4265) | Send Message
     
    catamount:

     

    If Ihad put that 8% or so of my paycheck into a 401k over the past 30+ years, I would have around $2.2 million dollars assuming a 4.5% growth rate.
    5 Aug 2011, 09:29 PM Reply Like
  • catamount
    , contributor
    Comments (374) | Send Message
     
    Junker: That's a great line. My parents also accumulated ~$10M, so I stand to benefit. But, they did not add the value proportionately. You are all greedy older folks that think you added more value than you actually did.

     

    If I were a descendant of your's, I would exhume your body and drag it down the street by horse to a dumpster. Total economic drag.
    5 Aug 2011, 09:31 PM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    Windsun....just think what it would be if you could have had yours and the employer's portion....12.5% of your wages.
    5 Aug 2011, 10:01 PM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    Or revenue enhancements.

     

    Thanks Teabaggers and Republicans alike!
    6 Aug 2011, 03:16 AM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    Geez Wyatt, your still here? I thought you went to Honduras or somewhere else where they don't have the amenities we pay taxes for here.
    6 Aug 2011, 03:18 AM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    SS is means tested for Federal employees. The SS is reduced commensurate with the size of their Pension. Which they paid into by the way. I paid into it for 34 years. Now I know someone on SA will call me a sloth for working for the government, but, I'm proud of my service and contribution to national defense. I worked hard, very hard, and paid a boat load of money into my pension fund. Because I get a federal pension I receive about 500.00/month in SS. Which by the way, I paid into also. Not much of a SS check is it? But, I'm not bitchin".
    6 Aug 2011, 03:28 AM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    Amenities huh? Is that what we're calling the DMV these days? Or is that the IRS? I'm not sure.

     

    Why don't you tell me.

     

    Show me this Club Med Disneyland of 'amenities' called the Federal Blubbermint.
    6 Aug 2011, 12:57 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    "Now I know someone on SA will call me a sloth for working for the government"

     

    Nah, I'm sure you were the best when it came to nap time in cubicle 44. Your pension started on the clock, on our dime, over 40 years ago. It was called "work". Not sure what it really was though.
    6 Aug 2011, 01:08 PM Reply Like
  • Cincinnatus
    , contributor
    Comments (3419) | Send Message
     
    "Now I know someone on SA will call me a sloth for working for the government,..."

     

    What it confirms once again is that when I see someone defending this headlong drive off the debt cliff, and montrous theft by government to support it's coddled classes, it's a good bet that individual has spent much of his/her life suckling from the government teat. I dare say it's GREED that drives you Monngie. Pure GREED.
    6 Aug 2011, 05:55 PM Reply Like
  • Freedoms Truth
    , contributor
    Comments (834) | Send Message
     
    "If we could only cut your SS and Medicare, we'd be clear sailing... "

     

    Yup, if they HAD cut my SS and Medicare, I would have come out ahead financially this past week - the market would have responded much better.

     

    I am with Junker: Means test entitlements and allow an opt-out. It's time we stop enslaving people into broken systems.
    6 Aug 2011, 08:10 PM Reply Like
  • Freedoms Truth
    , contributor
    Comments (834) | Send Message
     
    So TARP, ethanol subsidies, green energy boondoggles, BATF gun runners illegally sending guns to Mexico, auto company union bailouts, hundreds of billions in welfare state spending, troops in dozens of countries, corporate welfare, earmarks, housing grants, money for studies on insect sex, these are all ... amenities?

     

    Silly me.
    6 Aug 2011, 08:34 PM Reply Like
  • Robin Heiderscheit
    , contributor
    Comments (1815) | Send Message
     
    I don't blame today's politicians that much. This has been building for ten years. Get your Dow 10000 hats out again.
    5 Aug 2011, 09:05 PM Reply Like
  • Windsun33
    , contributor
    Comments (4265) | Send Message
     
    I think the practical effects of this will be pretty close to zero after the first couple days of shock and awe. These are the same folks that gave Lehman and AIG AAA ratings.
    5 Aug 2011, 09:07 PM Reply Like
  • Lebarjo
    , contributor
    Comments (36) | Send Message
     
    Exactly. They also downgraded Japan's debt around 2004, and nothing happened. JGB yields still went down even after they added more debt.
    5 Aug 2011, 09:15 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    What about its stock market? Curious. Did it take an initial hit? What about the next two years that followed?
    5 Aug 2011, 09:21 PM Reply Like
  • Lebarjo
    , contributor
    Comments (36) | Send Message
     
    Not sure. That may be a good google research assignment. I'm sure we'll get hit on Monday. I'm in bonds and will probably lose on Monday, but I'm not selling until the Fed acts.
    5 Aug 2011, 09:27 PM Reply Like
  • Bouchart
    , contributor
    Comments (763) | Send Message
     
    Japan's stock market has been in the tank forever. If it fell after their downgrade I doubt anyone noticed.
    5 Aug 2011, 09:39 PM Reply Like
  • Tack
    , contributor
    Comments (13002) | Send Message
     
    Yes, after the immediate chaos, it will be a non-event on the attractiveness of U.S. debt versus all the same choices now available. However, there should be some chaos, if only because there are huge holdings by pension and mutual funds that are designated by their charters to hold only AAA debt. That should mean a selling avalanche on Monday, at the minimum.
    5 Aug 2011, 10:21 PM Reply Like
  • Poor Texan
    , contributor
    Comments (3529) | Send Message
     
    "However, there should be some chaos, if only because there are huge holdings by pension and mutual funds that are designated by their charters to hold only AAA debt."

     

    Tack,
    Are they required to hold AAA debt as defined by S&P or can they use the AAA of a different rating agency?
    5 Aug 2011, 10:27 PM Reply Like
  • Tack
    , contributor
    Comments (13002) | Send Message
     
    PT:

     

    I am sure many funds have different rules on these matters. there's no "law" dictating the standards.

     

    In any case, I'd anticipate heavy selling in all debt securities in the early going. I'm never a big believer in "priced in."
    5 Aug 2011, 10:35 PM Reply Like
  • Windsun33
    , contributor
    Comments (4265) | Send Message
     
    Poor Texan - good question, but one bylaw example I found with a Google search was the statement: ".. by a generally recognized rating agency..."
    6 Aug 2011, 11:41 AM Reply Like
  • Guardian3981
    , contributor
    Comments (1954) | Send Message
     
    Maybe they learned there lesson hence the downgrade.
    5 Aug 2011, 09:10 PM Reply Like
  • Josh ODonnell
    , contributor
    Comments (229) | Send Message
     
    Its amazing to me how S&P waited until the market closed and made the announcement on a Saturday. They were probably afraid the stock market would collapse. Well, they are right. It would've.

     

    The market should sell off HUGE on monday...another 500-1000 pts on DOW
    5 Aug 2011, 09:11 PM Reply Like
  • catamount
    , contributor
    Comments (374) | Send Message
     
    You are truly giving to much credit to an agency that rated sub-prime CDOs as they did. Suddenly, you believe they are credible. Good luck.
    5 Aug 2011, 09:23 PM Reply Like
  • bearfund
    , contributor
    Comments (1534) | Send Message
     
    Want to buy an OTC futures contract on that? The DJIA closed today at 11444.61. For every point it closes above 10944.61 on Monday, you owe me $10. For every point it closes below 10944.61 on Monday, I owe you $10. This offer is only good for 24 hours, so hurry in!
    5 Aug 2011, 09:26 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    They have the credibility to force the buyers of bonds to get out of anything not triple A, which will raise rates.

     

    Anything else you said was irrelevant.
    5 Aug 2011, 09:31 PM Reply Like
  • Windsun33
    , contributor
    Comments (4265) | Send Message
     
    bear - what I really expect is a sharp drop at the open, with a gradual reversal, to finally end the day near even or perhaps even up 1/2% or so.

     

    But then I predicted that someone would hijack a bus and run over Snookie too, so I may be off a bit. Or maybe my timing is just off, on both predictions...
    6 Aug 2011, 11:45 AM Reply Like
  • wyostocks
    , contributor
    Comments (7712) | Send Message
     
    Ah, the Obama legacy is starting to be written.
    5 Aug 2011, 09:12 PM Reply Like
  • Tomcat101
    , contributor
    Comments (963) | Send Message
     
    Hoover will no longer be the worst president in history.
    5 Aug 2011, 10:20 PM Reply Like
  • ConstantLearner
    , contributor
    Comments (28) | Send Message
     
    No, you can thank the Republicans of the last 30 years. Obama just put the icing on the 3-tiered cake of debt accumulated over 30 years.
    zfacts.com/p/1170.html
    5 Aug 2011, 11:53 PM Reply Like
  • bigbenorr
    , contributor
    Comments (757) | Send Message
     
    Doesn't congress make the budget?
    6 Aug 2011, 12:02 AM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    Well, the Republicans are doing everything they can to make that happen.
    6 Aug 2011, 03:31 AM Reply Like
  • Freedoms Truth
    , contributor
    Comments (834) | Send Message
     
    Obama increased the public-held debt by 50% in 3 years!

     

    That's not the icing that's a whole other layer.

     

    And furthermore, in previous times, the problem was manageable, because with a 3%/GDP deficit and 3% economic growth, the debt/GDP ratio doesnt change much.

     

    But under Obama the economy is stagnant and the debt/GDP ratio is 10%! That makes the debt/GDP ratio grow very quickly.
    6 Aug 2011, 08:37 PM Reply Like
  • Lebarjo
    , contributor
    Comments (36) | Send Message
     
    The ratings agencies are just some guys with an activist agenda. People who can't hack it on Wall Street go to work for ratings agencies. They are much more severe with public debt than they are with private debt. They rated all of the subprime derivatives as AAA when it was junk. They downgraded Japan's debt, but the yields still went down. They are just some dudes who want to impose their worldview on others, but no one really cares what they think.
    5 Aug 2011, 09:19 PM Reply Like
  • kcr357
    , contributor
    Comments (557) | Send Message
     
    Agree 100%. This downgrade was months too late.
    5 Aug 2011, 09:24 PM Reply Like
  • bearfund
    , contributor
    Comments (1534) | Send Message
     
    While I don't care what they think, either, I think it's patently unfair to characterise them as being tougher on public entities than on private. There are plenty of profitable corporations that have been in business for decades, have more than ample interest coverage from earnings even though they have to pay 9% to borrow, and make products that people need and like, and are rated junk. Yet Japan's government which, like all governments, produces nothing and creates no value, and owes so much money that if it had to pay even 4% on its debt it would have no way to avoid default, is rated AA-.

     

    I consider Freeport McMoran's subordinated notes much safer than JGBs, for example, but the ratings agencies laugh at that opinion. The reality is that FCX can afford to pay 9% because it has a valuable, productive business. And if the market suddenly decided it won't lend to FCX at less than 20%, they tighten their belts, sell off some assets, and get about with their still-profitable business with less debt. If the market suddenly decided it won't lend to Japan at less than 20%, every JGB outstanding becomes completely worthless. Governments don't know how, or in some cases just lack the political will, to keep their debt under control. They rely on artificially low interest rates made available through manipulation and legislation to get by. If those rates rise, they're hopelessly lost. They don't know how to shrink themselves, and they don't know how to keep their debt load manageable so that they're not forced to face markets unwilling to lend in the first place. These are things that most corporations understand very well, making productive enterprises fundamentally safer credit risks than governments. You seem to think the ratings reflect this, and I disagree. You also seem to think it's misguided thinking on the part of ratings agencies, and I disagree with that too.

     

    The ratings agencies have their methods and their formulae. They are not magic, they are only marginally consistent, and there is no guarantee that you would beat the market by using their ratings. They're just another source of opinions. Feel free to ignore them; I do.
    5 Aug 2011, 09:39 PM Reply Like
  • Lebarjo
    , contributor
    Comments (36) | Send Message
     
    The debt ceiling debate was complicated by ratings agencies declaring that raising the ceiling would not be good enough, but $4 trillion needed to be cut. That is activism, not ratings. The ratings agencies, especially S&P, act like a mini-IMF forcing austerity.measures favorable to bondholders of public debt. They also intervened about 10 years when states tried to regulate predatory lending.

     

    The US bond market is the largest, most studied, and most transparent market on the planet. I don't think the ratings agencies have information or any insight that others do not have.
    5 Aug 2011, 09:56 PM Reply Like
  • Cincinnatus
    , contributor
    Comments (3419) | Send Message
     
    Lebarjo, your continual sucking up to Obamy and the Dems is transparent. Why should raising the debt ceiling be "good enough" for any rating agency? Raising the ceiling was irrelevant to credit worthiness. If I hit the limit on my credit card, getting the cc company to raise my credit limit doesn't in any way make me a better credit risk.
    6 Aug 2011, 12:27 AM Reply Like
  • Lebarjo
    , contributor
    Comments (36) | Send Message
     
    I'm no Obama fan. But whatever. You compare govt debt to consumers using a credit card. I wouldn't know where to begin, so I won't.
    6 Aug 2011, 03:38 AM Reply Like
  • cake_is_a_lie
    , contributor
    Comments (3) | Send Message
     
    Ah, but can FCX print it own money?

     

    Japan can and most of it's debt is in yen. Worst come to worst, they can print whatever amount is needed. On the other hand FCX has to rely on outside creditors.

     

    Seems clear to me what is the safer option.
    6 Aug 2011, 07:46 AM Reply Like
  • JB1982
    , contributor
    Comments (100) | Send Message
     
    Sure printing money like crazy would ensure that the debt gets paid but your investment would then be worthless due to inflation so I don't think that makes it any safer.
    6 Aug 2011, 09:27 AM Reply Like
  • bearfund
    , contributor
    Comments (1534) | Send Message
     
    Guess it takes two sides to make a market. I'll take 9% from productive enterprises that owe considerably less than their annual revenues and suffer a default from one of them every few years. You'll take 1% from a bloated bureaucracy that owes 8 times its annual revenues, which you admit will deliberately devalue the currency in which it repays you, and which will still default anyway every 50 to 100 years.

     

    After an indefinitely long period of time following these strategies, I'll be looking for more warehouses to store all my gold, and you'll be looking for a scrap of bread.
    6 Aug 2011, 11:15 AM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    "I'm no Obama fan. But..."

     

    This is where I stop reading posts.

     

    I have a built-in BS meter.
    6 Aug 2011, 01:10 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    I don't think we can inflate like we used to. Now, it affects the entire world. Not so in the late 70's.

     

    Now, inflation causes food riots. And it will probably lead to war as all defaults in recorded history usually do.

     

    The bigger the government, the higher the rate of poverty and starvation. Just a fact.

     

    Tell that to all your big goobermint worshipping drones. I know how much they like a giant federal Parent to tuck them in at night. Problem is, it kills Arabs and East Indians and starves the Chinese.

     

    I doubt they'll let us do it again this time. Not when they hold our debt.
    6 Aug 2011, 01:13 PM Reply Like
  • Cincinnatus
    , contributor
    Comments (3419) | Send Message
     
    It's obvious you have no idea where to begin. Raising the debt ceiling did nothing to improve the credit worthiness of the US. If debt is the issue, then increasing debt wouldn't improve your rating. Is that not obvious to you?
    6 Aug 2011, 03:44 PM Reply Like
  • Terry330
    , contributor
    Comments (866) | Send Message
     
    Thanks Tea Party for the downgrade.
    5 Aug 2011, 09:22 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    Did we get $4 trillion in cuts? That was S&P's starting number.

     

    And that was just on the cuts side that they telegraphed the number to be, minimum.

     

    No. In the last election the TP was voted in with one objective. To cut federal spending. They tried.

     

    Obama, Reid & Pelosi *the three stooges* did everything in their power to block it. They just flipped off the American people and told them to drop dead. They're not stopping their spending. They will implode this nation's credit rating and they have. Now we will suffer with higher interest and servicing costs on the debt as well. Nice.
    5 Aug 2011, 09:28 PM Reply Like
  • DubyaT
    , contributor
    Comments (42) | Send Message
     
    The "grandest deal in all the land" was supposed to get close but the Tea Partiers didn't like it because it might get a black guy re-elected to the White House.
    5 Aug 2011, 09:40 PM Reply Like
  • catamount
    , contributor
    Comments (374) | Send Message
     
    I'm wondering where the hell you geniuses were when we invaded Iraq? I'd be interested to see any objections you held at that time (when we had a $5T deficit).

     

    I am skeptical, however, if you would ever reply to such an idea.
    5 Aug 2011, 09:40 PM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    Catamount....I am now and was then against Iraq. I am against Afghanistan. Iraq and Libya - I think they were the leaderships counter to the possibility of killing the oil priced in dollars deal. Afghanistan...well to me that's just poppy field protection for the drug industry. We have no business being the world cop. We can protect ourselves from inside US soil. We have a global reach in the air and on the sea. Bring the troops home.
    5 Aug 2011, 10:06 PM Reply Like
  • Poor Texan
    , contributor
    Comments (3529) | Send Message
     
    "We can protect ourselves from inside US soil."

     

    But we didn't do so on 9/11.
    5 Aug 2011, 10:20 PM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    Here's the answer to that. Just put the No Trespassing Sign up. Tell the world that if there is a terrorist event, we have a hit list. We'll start at the top and work our way down. First target is Iran. So Iran...you had better bust your butt to make sure nothing happens to America. Second target is Pakistan, etc. We don't care who pulls the terrorist trigger, this is our response and we will respond unfailingly.
    5 Aug 2011, 10:29 PM Reply Like
  • ConstantLearner
    , contributor
    Comments (28) | Send Message
     
    Obama offered a $4T deficit cut (yes, with repeal of the Bush tax cuts)...the Republicans didn't. S&P specifically cited the lack of revenue generation for the ratings downgrade.
    5 Aug 2011, 11:56 PM Reply Like
  • DianeLee
    , contributor
    Comments (352) | Send Message
     
    I was very much opposed to invading Iraq, who was a natural buffer to Iran. We could've/should've hunted and attacked al Qaeda much as we do now, and made it abundantly clear to the Taliban their enabling wasn't appreciated. Terrorists cannot be hunted by countries, as they move fluidly across borders.
    6 Aug 2011, 12:01 AM Reply Like
  • cake_is_a_lie
    , contributor
    Comments (3) | Send Message
     
    Great suggestion... except that if anyone would want to hit Iran the easiest route would be to make a small attack on US. And then we have another war.
    6 Aug 2011, 07:51 AM Reply Like
  • superpatrol
    , contributor
    Comments (616) | Send Message
     
    the most prominent part of the downgrade was using the debt ceiling as a political bargaining chip. Republicans just lost the election
    6 Aug 2011, 02:03 PM Reply Like
  • Freedoms Truth
    , contributor
    Comments (834) | Send Message
     
    "The "grandest deal in all the land" was supposed to get close"

     

    Baloney. if there was a deal that was so great, show us the text, the bill, and the votes.
    The only real solution put forward was Cut, Cap and Balance. Harry Reid killed it an Obama threatened to veto it. Their brinkmanship and stubborness prevented us from having a solid deal.
    6 Aug 2011, 08:40 PM Reply Like
  • Freedoms Truth
    , contributor
    Comments (834) | Send Message
     
    You are so out to lunch....

     

    "when we had a $5T deficit" We had a much lower deficit than that, around $300 billion.
    Once the Democrat took control of Congress, the deficit quintupled.

     

    It's ludicrous to blame Iraq for the fiscal mess we are in, when Obama's stimulus alone cost more than 6 years of Iraq war.
    6 Aug 2011, 08:42 PM Reply Like
  • Freedoms Truth
    , contributor
    Comments (834) | Send Message
     
    Obama offered a $4T deficit cut (yes, with repeal of the Bush tax cuts)"

     

    BS, he offered NOTHING. Obama's plan was for $14 trillion in deficits for 10 years, and his April update was so vacuous CBO said they would not and could not score it. You cant score a speech, you cant pass something 'offered'.

     

    Obama is a complete incompetent non-leader. He had and still has no plan to fix the debt crisis. His own budget was such a sad joke of fiscal lunacy it was voted down in the Senate 0-97.

     

    This whole "he offered a great deal"(*) is mindless liberal spin attempting to paper over the leadership vacuum in the white house.

     

    (*)And note that Republicans in negotiations said he kept shifting the goalposts so they basically gave up and negotiated with Reid.
    6 Aug 2011, 08:46 PM Reply Like
  • Freedoms Truth
    , contributor
    Comments (834) | Send Message
     
    So wrong, its funny.

     

    S&P's problem is the debt, not the debt ceiling. S&P wanted to see real serious deficit reduction by cutting spending and reforming entitlements and they did see it. They gave a negative verdict on the deal's ability to curb long-term deficits.
    6 Aug 2011, 08:48 PM Reply Like
  • The Enterprising Value Inve...
    , contributor
    Comments (512) | Send Message
     
    I've said it once and I will say it again.

     

    With bond markets as deep as they are for sovereigns such as the US and Japan, ratings agencies don't price these bonds, the market does.

     

    Do you honestly think the Treasury market is gonna wake up on Monday and decide that they were pricing Treasuries incorrectly for the last few months. I doubt that.
    5 Aug 2011, 09:28 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    Obama already spent the new money he was just granted on the debt deal. Its gone. Evaporated.

     

    Now he's off to a barbecue and another round of golf, in-between the hip hop concert at the WH.
    5 Aug 2011, 09:30 PM Reply Like
  • DubyaT
    , contributor
    Comments (42) | Send Message
     
    Dude I watched Fox today too. It went golf, BBQ, praising Allah then hip-hop
    5 Aug 2011, 09:41 PM Reply Like
  • goldmanscahses
    , contributor
    Comments (11) | Send Message
     
    Impeach Barracky Hassein Omama...utter disgrace....
    5 Aug 2011, 09:47 PM Reply Like
  • ConstantLearner
    , contributor
    Comments (28) | Send Message
     
    Racist much?
    5 Aug 2011, 11:57 PM Reply Like
  • Derek A. Barrett
    , contributor
    Comments (3534) | Send Message
     
    Seriously, that was pretty messed up and pretty damn racist.
    6 Aug 2011, 02:12 AM Reply Like
  • DubyaT
    , contributor
    Comments (42) | Send Message
     
    Cut morr tackses.
    5 Aug 2011, 09:31 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    Nah. Leave 'em where they are. Cut the warmongering & the domestic free fudge.

     

    Any more taxation on me and I just close shop and go to Panama. Enjoy your 20% unemployment.

     

    No sarc.
    5 Aug 2011, 09:33 PM Reply Like
  • davidshelton
    , contributor
    Comments (310) | Send Message
     
    So what happened to the 2Trillion error found by Treasury officials??
    5 Aug 2011, 09:32 PM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    Don't worry....it'll get revised downward, just like GDP.
    5 Aug 2011, 10:07 PM Reply Like
  • Terry330
    , contributor
    Comments (866) | Send Message
     
    The outlook on the long-term rating is negative. As our downside alternate fiscal scenario illustrates, a higher public debt trajectory than we currently assume could lead us to lower the long-term rating again. On the other hand, as our upside scenario highlights, if the recommendations of the Congressional Joint Select Committee on Deficit Reduction–independently or coupled with other initiatives, such as the lapsing of the 2001 and 2003 tax cuts for high earners–lead to fiscal consolidation measures beyond the minimum mandated, and we believe they are likely to slow the deterioration of the government’s debt dynamics, the long-term rating could stabilize at ‘AA+’. From: S&P
    5 Aug 2011, 09:32 PM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    Dang Terry....that's the most intellgent thing I've ever seen you post....are you sure your husband didn't jump on your computer while you were using the restroom????
    5 Aug 2011, 10:08 PM Reply Like
  • JohnBinTN
    , contributor
    Comments (3629) | Send Message
     
    Terry learned how to cut & paste. Thank god, or god help us - not sure.
    5 Aug 2011, 11:12 PM Reply Like
  • rothyman
    , contributor
    Comments (126) | Send Message
     
    Oh so you really are a woman. It's all making sense now..
    5 Aug 2011, 11:16 PM Reply Like
  • Windsun33
    , contributor
    Comments (4265) | Send Message
     
    WM - it was a cut and paste.
    5 Aug 2011, 11:59 PM Reply Like
  • JohnLocke
    , contributor
    Comments (381) | Send Message
     
    I wonder who the rats jumping off the sinking ship that were selling on the insider information yesterday??? 500+ point drop out of the blue... What a bunch of crooks.

     

    Thank you Standard and Poors for being willing to take a stand independent of the other sheep.

     

    Thank you to the Tea Party for demanding the dialog and realizing there are no sacred cows in this discussion.

     

    Reality is quickly approaching folks...
    5 Aug 2011, 09:33 PM Reply Like
  • Terry330
    , contributor
    Comments (866) | Send Message
     
    Happy, tea baggers? Your whole agenda is to bring down the government. You are at heart traitors. You will pay. Read the latest poll. Less than 20% of Americans trust you, and for good reason.
    5 Aug 2011, 09:38 PM Reply Like
  • JohnLocke
    , contributor
    Comments (381) | Send Message
     
    I served my country for 20 years and was honorably discharged... You dare to call me a traitor to a country that I have fought and become disabled for???

     

    What have you done for your country you tree hugging hippy...

     

    You are a bottom feeder Terry and I do feel sorry for you BUT I was happy to defend you.
    5 Aug 2011, 09:46 PM Reply Like
  • davidbdc
    , contributor
    Comments (3150) | Send Message
     
    Frankly speaking, who gives a damn about the "polls". The "polls" basically ask - would you like someone to give you money for nothing? And 75% say yes.

     

    The "polls" ask - do you support reducing social security payments? And 75% say no.

     

    Guess what? 75% of the folks don't have the slightest clue about the overall makeup of the budget (in years when one gets passed) nor do they understand the depth of the fiscal problem facing the USA.

     

    How about we ignore the polls and concentrate of the math of balancing a budget!
    5 Aug 2011, 10:39 PM Reply Like
  • rothyman
    , contributor
    Comments (126) | Send Message
     
    Terry, Terry, Terry..

     

    I really do respect you for hanging on to your liberal beliefs in the face of an absolute liberal fiasco, but let's be real.

     

    The Democrats will go down on this one HARD. They wanted less cuts and that's why we were downgraded. You can talk around that al you want, but that's the bottom line and denying that is denying what we all come to know as 'the truth'?

     

    You believe in the truth.. don't you Terry?
    5 Aug 2011, 11:18 PM Reply Like
  • Windsun33
    , contributor
    Comments (4265) | Send Message
     
    ".. You are at heart traitors. You will pay.."

     

    It makes me really sad that I spent 10 years in the military, much of that in some pretty yucky places, to defend the ignorant drivel and talking points that you constantly spout.
    6 Aug 2011, 12:02 AM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    "How about we ignore the polls and concentrate of the math of balancing a budget!"

     

    Sorry, can't do that.

     

    Terry wants to keep yanking her Chatty Cathy doll neck pullstring, from Mattel.
    6 Aug 2011, 12:11 AM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    Keep ringin' that bell Terry330.

     

    It can't be said enough.
    6 Aug 2011, 03:37 AM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    Same for me JohnLocke.

     

    Regrettably for you, Terry's right. The Teabaggers nearly brought this country to its knees. Not Patriotic. If you regard yourself as a teabagger, you need to try and influence your chuckleheads in DC to do something constructive. You know. Teamwork instead of roadblock.

     

    I think after this little jewel they are going to prance off into mamby pamby land and never be heard from again. Like the Bull Moose Party.
    6 Aug 2011, 03:44 AM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    But the Speaker of the House, John Boner, said he got 98% of what he wanted and he was happy.

     

    Replay that video about ten times and get back to me.
    6 Aug 2011, 03:48 AM Reply Like
  • superpatrol
    , contributor
    Comments (616) | Send Message
     
    Yes JohnLocke,
    you once were a hero, but now
    YOU ARE A TRAITOR, if you support the use of the debt ceiling and disregard for full faith and trust of the US as a political bargaining chip
    Yes.
    6 Aug 2011, 02:08 PM Reply Like
  • superpatrol
    , contributor
    Comments (616) | Send Message
     
    well at some point after your service for our country, you lost some of your character. I'm fairly sure the younger you would see the attempt to piss on our obligations and use the debt ceiling as a bargaining chip as pretty treasonous behavior.

     

    It is really sad.
    6 Aug 2011, 02:14 PM Reply Like
  • JohnLocke
    , contributor
    Comments (381) | Send Message
     
    If the country keeps going at its current pace it will bring itself to it's knees will you still blame the Tea Party? All you need to do is run the math out 10-15 years people...

     

    How are we solving the problem folks?

     

    Democrat / Republician it makes no difference

     

    Teamwork / Compromise are the same half steps that keep kicking the same problem down the road.
    6 Aug 2011, 04:09 PM Reply Like
  • JohnLocke
    , contributor
    Comments (381) | Send Message
     
    That does not make me a "Traitor"
    You all spout the Democrats latest attack word like it is an original thought...lol

     

    You said the Key words: FULL FAITH and TRUST

     

    What do those words mean to you?

     

    My faith has been shaken and the trust has been violated on many occasions by democrat and republican alike...

     

    It is not the Tea Partys fault, look in the mirror it is your fault, look around it is our faults...
    6 Aug 2011, 04:16 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    And if you keep inhaling aerosol paint cans like your posts suggest, debts don't mean anything. But continue on. Hearing you repeat LSM script is good fun.
    6 Aug 2011, 04:16 PM Reply Like
  • wyostocks
    , contributor
    Comments (7712) | Send Message
     
    More than trust Obama.
    6 Aug 2011, 04:21 PM Reply Like
  • wyostocks
    , contributor
    Comments (7712) | Send Message
     
    Hey Terry, Obama's little boy Timmy told us in no uncertain terms, just a few weeks ago, that there was "no chance" that the credit rating would be downgraded.
    Care to explain why he lied?
    6 Aug 2011, 04:25 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    zing.
    6 Aug 2011, 04:28 PM Reply Like
  • Lebarjo
    , contributor
    Comments (36) | Send Message
     
    japan had its debt downgraded about 6 or 7 years ago. Nothing happened to yields. Then they had their debt downgraded this year in January from AA to AA-, and again nothing happened.

     

    money.cnn.com/2011/01/...
    5 Aug 2011, 09:40 PM Reply Like
  • davidshelton
    , contributor
    Comments (310) | Send Message
     
    "The yen eased to two-month lows against the dollar Friday while Japanese shares dipped slightly, after Standard and Poor's cut Japan's long-term debt rating" - This from NDTV.com from the cut of January this year. Anyone know what happened after the original cut?
    5 Aug 2011, 09:54 PM Reply Like
  • Geoffrey Rocca
    , contributor
    Comments (69) | Send Message
     
    This ratings downgrade has nothing to do with actual credit quality and everything to do with the impasse in Congress. Futhermore, S & P assumes that the Bush tax cuts, which were a bad idea to begin with and a worse idea to renew, will be extended again. At some point, the anti-tax crowd is going to have to yield to economic reality, and a bipartisan agreement to allow the tax cuts to expire will go a long way to restoring our rating.
    5 Aug 2011, 09:43 PM Reply Like
  • Bouchart
    , contributor
    Comments (763) | Send Message
     
    We have about $2,000,000,000 in annual revenue. That should be plenty for the government to perform its constitutionally required functions. We don't need more taxes.
    5 Aug 2011, 09:46 PM Reply Like
  • bearfund
    , contributor
    Comments (1534) | Send Message
     
    You left off three zeros, but your point is still spot on. Actually, the government could easily perform its constitutionally valid functions on half that amount, probably much less.
    5 Aug 2011, 09:56 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    "This ratings downgrade has nothing to do with actual credit quality and everything to do with the impasse in Congress."

     

    The price of gold says otherwise.
    6 Aug 2011, 12:13 AM Reply Like
  • Cincinnatus
    , contributor
    Comments (3419) | Send Message
     
    It's has everything to do with credit quality. Spending is the problem. There's no way spending 25% of GDP is going to be sustained or that increasing taxes is going to make up for that extreme level of spending. Before you ever got close (by attempting to raise revenues to fill the gap) you'd kill GDP growth and enter a negative feedback loop.
    6 Aug 2011, 12:58 AM Reply Like
  • superpatrol
    , contributor
    Comments (616) | Send Message
     
    you didn't read the s&p report did you cinci?
    if we increase the tax rate to the 1945-2010 average level, that amounts to $3-4 Trillion over a decade. instead you idiots don't realize that the total Federal tax rate are lower than at any time since the Japanese arrived in Pearl Harbor. It's easy to find $3-4 trillion over a decade: restore the normal effective tax rate.

     

    but oh no!!! that hurts the wealthy disproportionately? well the wealthy have a higher proportion of national income and wealth than at ANY TIME in US history. you think we can bear more responsibility for our country?
    6 Aug 2011, 01:59 PM Reply Like
  • kcr357
    , contributor
    Comments (557) | Send Message
     
    Yes, great idea. I would love to pay for entitlements I have never and will most likely never use. Where do I send the check?
    6 Aug 2011, 04:25 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    And where in the hell will the gdp growth come from when you extract $5 trillion from it? Not even a CBO score could give you the necessary 4 - 5.5% GDP growth over those 10 years(firing on all cylinders) to bridge that gap, unlike Obama's lies in his 'plan'.
    6 Aug 2011, 04:30 PM Reply Like
  • superpatrol
    , contributor
    Comments (616) | Send Message
     
    a good chunk of that $4T isn't being spent; instead it is being put into savings accounts where it has little stimulative effect on the economy, as interest rates are already so low. banks build up excess reserves, corporations build up cash.
    i don't think taxes should return to normal levels yet, but if republicans did really want to find $4T in debt savings, it is obvious where that cash went.
    6 Aug 2011, 08:33 PM Reply Like
  • Freedoms Truth
    , contributor
    Comments (834) | Send Message
     
    When will the spend-it-all crowd bow to reality? The problem isn't taxes.

     

    We spend $3.7 trillion a year, 40% more than in 2007. 25% of GDP. Since WWII, the past 60 years, we NEVER collected more than 20% in GDP in taxes. Never. So we will never get our deficit under control unless we CUT THE SPENDING.

     

    Hiking the 35% taxrate on the upper incomes will barely bring in another $50 billion/yr, a drop compared to the $1.5 trillion deficit, and NOT A SINGLE POLITICIAN IN CONGRESS IS FOR REPEALING ALL THE BUSH TAX CUTS, ie the part that really cost money, the middle-class tax cuts.

     

    This has nothing to do with Republican or Democrat. $3 trillion of the Bush tax cuts on the middle class and working class will be extended. $14 trillion deficit hole. Tax rate increases will kill jobs and get you very little, although a Simpson-Bowles style loophole closure paired with rate reductions will get you something revenue-wise.

     

    But you still have 90% of the problem left. One answer remains: Cut the Spending.
    6 Aug 2011, 09:01 PM Reply Like
  • JohnBinTN
    , contributor
    Comments (3629) | Send Message
     
    It's also easy to find that much (or even more) by leaving taxes where they are (thanks, I pay enough already) and cutting welfare, SNAP, defense, SS, Medic*e, FDA, EPA, DoEd/En, etc.....
    6 Aug 2011, 09:10 PM Reply Like
  • bearfund
    , contributor
    Comments (1534) | Send Message
     
    Of course, from 1789 until 1913 there was no income tax, period. The United States in 1789 was a small, weak nation with dubious credit. The United States in 1912 was a growing global power with strong credit. So if you really want to dance with the one we brought, you should be advocating a repeal of the 16th amendment. I'm on board; anyone else?
    6 Aug 2011, 11:06 PM Reply Like
  • Geoffrey Rocca
    , contributor
    Comments (69) | Send Message
     
    Actually, Abraham Lincoln gave us the first income tax in 1861. Unlike some other Republicans, he had more sense than to get us into a war without seeing the need to pay for it.
    7 Aug 2011, 12:15 AM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    Good. Let the corporations keep their own money. Govt. will just flush it down the crapper.

     

    Who knows, corporations will find better use for it either in funding growth(hello, jobs?) or paying dividends(better than t-bills) or buying back shares.

     

    What will govt. do with the confiscated theft? Pay down the debt? Hardly. They will just keep destroying created wealth.
    7 Aug 2011, 02:50 AM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    Yeah, I don't think Civil Wars count.

     

    But I agree we should bring back the war bonds if we want to splode up them thar yonder ways.

     

    Create vested interest. Make the yield higher on 'em. Then let granny fund the bloodshed.

     

    I'd buy a war bond if the yield was 6 to 7% tax free and the cause was just.
    7 Aug 2011, 02:57 AM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    You make too much sense on SA, FT.

     

    Stop it.
    7 Aug 2011, 02:58 AM Reply Like
  • goldmanscahses
    , contributor
    Comments (11) | Send Message
     
    LMAO at the US!!

     

    Enjoy, the food stamps and the unployment benefits...

     

    PS: Food stamps record high....
    5 Aug 2011, 09:45 PM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    goldmansaches....and what 2nd rate nation do you live in?
    5 Aug 2011, 10:11 PM Reply Like
  • rothyman
    , contributor
    Comments (126) | Send Message
     
    WMARKW.. ROFL
    5 Aug 2011, 11:20 PM Reply Like
  • mcdonaldfive
    , contributor
    Comments (32) | Send Message
     
    We've been financing three wars and now a new medical benefits program, not to mention fiscal stimulus. I think it is good to worry about the drag that is going to cause in the future as we need to pay it back and the population ages.

     

    What is distressing is the polarized nature of the debate on how to deal with this. Some people want to deny that these things have been done and that cuts can solve the problem. The wars and the stimulus can't be solved by cuts - we are going to have to pay more tax until those are payed down. The healthcare and growth in entitlements programs can be adjusted - and maybe they need to be to help pay for the one time items.

     

    Either way - there is nothing close to a consensus on framing the issue as I just did so there is rancourous debate on how to fix it.

     

    S&P is saying they do not see it getting fixed. So, if you want to buy US debt then be fair warned - stay with the short end of the yield curve.
    5 Aug 2011, 09:59 PM Reply Like
  • tunaman4u2
    , contributor
    Comments (2784) | Send Message
     
    I love how it took freakin decades to come up with 14.5 trillion & its all on Obama
    You political clowns, neither party will save you, both parties got us here.
    5 Aug 2011, 10:03 PM Reply Like
  • Windsun33
    , contributor
    Comments (4265) | Send Message
     
    Presidents don't pass budgets or spending bills, congress does. And both parties have been on spending binge for years.
    6 Aug 2011, 12:04 AM Reply Like
  • tunaman4u2
    , contributor
    Comments (2784) | Send Message
     
    Thank you! I just will NEVER get these politicos who use this to parade their party.

     

    Ridiculous.
    6 Aug 2011, 06:47 PM Reply Like
  • Freedoms Truth
    , contributor
    Comments (834) | Send Message
     
    The Democrats ran Congress from 2007 to 2011 and they increased the spending by 40% in that time period. This is the largest non-WWII increase in US history, and the spending/GDP ratio is much higher than post-WWII historical norms.

     

    In 3 years, Obama increased the public-held debt by 50%, the fastest rate in US history.

     

    Our Federal government is living WELL above its means.

     

    It's time to stop pointing fingers and start cutting the spending.
    6 Aug 2011, 09:09 PM Reply Like
  • Derek A. Barrett
    , contributor
    Comments (3534) | Send Message
     
    You just pointed fingers though lol.
    6 Aug 2011, 09:11 PM Reply Like
  • Cincinnatus
    , contributor
    Comments (3419) | Send Message
     
    Darkway, time to grow up. Finger pointing would be attempting to assign blame without facts. Presenting facts and drawing conclusions isn't finger pointing. If it is taken to be that, as you would like it to be (dumbed down rhetoric always benefits you marxists), then we are doomed.
    6 Aug 2011, 11:09 PM Reply Like
  • Derek A. Barrett
    , contributor
    Comments (3534) | Send Message
     
    "Facts" lol
    7 Aug 2011, 02:19 AM Reply Like
  • davidshelton
    , contributor
    Comments (310) | Send Message
     
    What a circus! Announcing now on a Friday night. Emergency new debt deal rushed though before Monday´s open!? You´ve got to laugh....
    5 Aug 2011, 10:11 PM Reply Like
  • Terry330
    , contributor
    Comments (866) | Send Message
     
    Bush added 5.5 T over his term and created structural deficits (tax cuts, wars & medicare part D) that continue to this day. The OMB forecast the defict the first year O was in office at $1.2 T USD in January BEFORE he took office. We were running ACTUAL deficts close to the value of TARP when Bush was in office (NOT budget deficits since much of Bush's spending was off-budget legislative appropriation - I think he called it "fuzzy math").
    5 Aug 2011, 10:22 PM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    Terry...another brilliant post....or should I say Terry's husband?

     

    So by now you should know that it doesn't matter who's in charge, the game is the same. You can destroy any country with a fiat currency by spending it to death. Did you ever think that might be the objective?
    5 Aug 2011, 10:32 PM Reply Like
  • mike8599
    , contributor
    Comments (586) | Send Message
     
    Terry - Obama is the pres - he owns it, and history will say it no matter how much you try to say otherwise.
    5 Aug 2011, 10:47 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    Terry's a tea partier now. From the sound of her post, it seems she wants to cut everything. I'm proud of it.
    6 Aug 2011, 12:15 AM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    Terry is a tea partier....Terry is a tea partier.....nanny nanny boo boo.
    6 Aug 2011, 12:22 AM Reply Like
  • Windsun33
    , contributor
    Comments (4265) | Send Message
     
    WM - Terry is just cutting and pasting from Wikipedia again, it was not an original thought.
    6 Aug 2011, 12:42 AM Reply Like
  • Papaswamp
    , contributor
    Comments (2195) | Send Message
     
    Just a little govt 101 for you…presidents don't write spending or tax legislation….congress does. Majority of executive branch power is concentrated in foreign affairs. Presidents are merely check and balance. I think you will find both parties are part of this game. They have different rhetoric, but when it comes down to it…the small group of powerful politicians (now showing it's face in the new "super congress") are the ones making the deals. Bush was too stupid to come up with any ideas on his own. Obama doesn't seem to really care and is clearly run by his chief of staff.
    6 Aug 2011, 07:51 AM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    But the executive still holds the veto pen to all proposed spending legislation, no?
    6 Aug 2011, 01:17 PM Reply Like
  • Freedoms Truth
    , contributor
    Comments (834) | Send Message
     
    The OMB forecast the defict the first year O was in office at $1.2 T USD in January BEFORE he took office."

     

    This was a budget the Democrats in Congress wrote. President Bush vetoed the domestic spending for spending too much, but then the Democrats waited for Obama to become President, and got their extra $100 billion in earmark-and-pork spending signed by Obama.

     

    That FY 2009 had included in in the $1 T Stimulus bill, SCHIP expansion, the additional $100 billion in spending the Democrats wanted to have but Bush vetoed, and TARP II.

     

    So they were able to jack up spending by hundreds of billions and deficits up to $1.6T. On TOP of the highest spending and highest deficit in the prior year. Phew!!

     

    Nobody, but NOBODY, can outspend the Democrats.
    6 Aug 2011, 09:12 PM Reply Like
  • Derek A. Barrett
    , contributor
    Comments (3534) | Send Message
     
    Stop finger-pointing brah
    6 Aug 2011, 09:15 PM Reply Like
  • Papaswamp
    , contributor
    Comments (2195) | Send Message
     
    @Wyatt
    "But the executive still holds the veto pen to all proposed spending legislation, no?"

     

    Correct..but the final approved legislation is not written by him. He just says yes or no.
    6 Aug 2011, 09:43 PM Reply Like
  • 1980XLS
    , contributor
    Comments (3314) | Send Message
     
    Darkway,

     

    Rather than Finger pointing, I see it as pointing out 8th grade arithmetic, of which you are in denial of. Just like a 6 year old telling his mom he wants another Ice Cream Cone.

     

    Sorry, the party's over.

     

    If the "extremists" (AKA only adults in the room) have not made it clear to you, the markets will very, very soon.
    6 Aug 2011, 09:43 PM Reply Like
  • Derek A. Barrett
    , contributor
    Comments (3534) | Send Message
     
    You missed his comments above about fingerpointing, so again are off ranting on a tangent completely out of context. More like 4th grade reading comprehension brah.
    6 Aug 2011, 09:46 PM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    O dang....I was starting to get hopeful.
    7 Aug 2011, 10:42 AM Reply Like
  • davidshelton
    , contributor
    Comments (310) | Send Message
     
    I wonder how much longer France and the UK will keep AAA with a stable outlook?
    5 Aug 2011, 10:33 PM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    Well that would be about 3 nano seconds. France is linked to Italy big time.
    5 Aug 2011, 10:40 PM Reply Like
  • greenmonkey
    , contributor
    Comments (19) | Send Message
     
    True, but one cited reason for the downgrade is the political dysfunction. You don't see French or UK politicians threaten to default in order to push through political agenda. This is a type of political risk bondholders of French and British debt simply don't have to worry about.
    6 Aug 2011, 10:57 AM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    This makes no sense. The debt ceiling was raised. Gridlock had nothing to do with a downgrade. In fact, gridlock was good. Unfortunately not good enough as the left didn't seem to care. They would rather default than lose the ability to float more debt onto unborn children. The agency wanted real cuts and none were to be had.

     

    I think the real reason the downgrade came was because there was a deal to raise the ceiling and no cuts were made.

     

    And the agency was probably even more alarmed that Obama then inhaled that new money like Tony Montana, or his coke wife, plastic given to him like a child with dad's gold Amex card.

     

    Then he went back to his dinner party with rich fat cats to raise funds for his 2012 campaign at $78,000/plate. The agency was amazed at how quickly borrowed money can just ... disappear any time Obama gets near it.
    6 Aug 2011, 01:22 PM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    No but I see the French workers strike every time they threaten to raise the work week from 20 hours to 21.
    7 Aug 2011, 10:44 AM Reply Like
  • greenmonkey
    , contributor
    Comments (19) | Send Message
     
    As I said in my original post, the political dysfunction was *cited by S&P*, it's not my personal opinion, so I'm not sure what doesn't make sense to you?

     

    Here's the title of the S&P report:

     

    United States of America Long-Term
    Rating Lowered To 'AA+' On
    Political Risks And Rising Debt
    Burden; Outlook Negative

     

    (www.standardandpoors.c...)

     

    In the first sentence of their section titled "Rationale" they cite "prolonged controversy over raising the statutory ceiling". So again, you may not agree with their reasoning, but it's a fact that we have been downgraded in part because some politicians thought it is OK to hold bond-holders hostage in order to push through political agenda. When given a choice of the UK, where one only has to consider if the country is able to pay, and US where now one has to both consider ability *and* willingness, to me, it's clear that the latter is riskier and does not deserve the same rating as the former.
    7 Aug 2011, 10:56 AM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    Do you mean when Obama walked out the first time to end talks or when Harry Reid filibustered his own bill the last time?

     

    Which one?
    7 Aug 2011, 12:05 PM Reply Like
  • greenmonkey
    , contributor
    Comments (19) | Send Message
     
    Tying the debt ceiling to the budget negotiations was a Republican idea, so it's hard to blame Obama when there would have been nothing to walk out on had Congress simply raised the ceiling independently of budget negotiations, just as it has been done since the 60s.

     

    For Republicans to say "well, if x doesn't happen we won't raise the debt ceiling" is like you and a group of friends going to a restaurant, all agreeing to order an appetizer, all eating the appetizer, and then having 1 of your friends say "if I don't get my choice on the main course, I'll prevent the restaurant from collecting on the bill for the appetizer". Obviously, the restaurant rather not deal with customers who make that type of threat because, from the restaurant's point of view, the appetizer has absolutely nothing to do with the main course. And hopefully you will agree that stiffing the restaurant for the appetizers is not ethical under any condition, so to make the threat in the first place is utterly irresponsible and S&P was justified in responding with a credit downgrade while leaving the UK and France at AAA.
    7 Aug 2011, 02:30 PM Reply Like
  • Derek A. Barrett
    , contributor
    Comments (3534) | Send Message
     
    France still has their AAA debt rating. In fact most of the remaining countries that have it:

     

    1) Have much higher taxes than the US
    2) Higher quality of life
    3) Free health care
    4) Would be labeled as "socialists" by the Libertarians, Republicans, and Tea Baggers
    7 Aug 2011, 06:38 PM Reply Like
  • JohnBinTN
    , contributor
    Comments (3629) | Send Message
     
    1) True
    2) Debatable
    3) Because of #1 (definitely not 'free')
    4) If it walks like a duck, quacks like a duck....
    7 Aug 2011, 07:16 PM Reply Like
  • Derek A. Barrett
    , contributor
    Comments (3534) | Send Message
     
    They are socialist countries, and why they have higher quality of life, yet still somehow are more fiscally solid. :)
    7 Aug 2011, 07:20 PM Reply Like
  • 1980XLS
    , contributor
    Comments (3314) | Send Message
     
    Darkway,

     

    Higher quality of Life?

     

    People can maintain a high quality of life with unsustainable Ponzi Debt.

     

    If we have not learned anything, it should be that

     

    You should just move there then.

     

    Both American in Paris, and France would both love to have you.
    7 Aug 2011, 07:47 PM Reply Like
  • Derek A. Barrett
    , contributor
    Comments (3534) | Send Message
     
    You've probably never even been to any of those places.
    7 Aug 2011, 07:59 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    Yes, the federal deficit is an Olive Garden. Smartz.
    7 Aug 2011, 10:09 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    1) Have traditionally had much lower growth than the US(before Obama).

     

    2) Use the United States military so they don't have to pay for one to fund their socialism.

     

    3) Have mandatory 35 hr. workweeks, no overtime, its the law.

     

    4) Assurance Maladie is filthy, incompetent & bankrupt. Oh yeah, its 'free' too, forgot.

     

    5) Cramped ugly apartments but we call that 'old world charm'.
    7 Aug 2011, 10:14 PM Reply Like
  • Derek A. Barrett
    , contributor
    Comments (3534) | Send Message
     
    Most of that excess growth we have goes to the upper strata anyway making it worthless for the average person relatively.
    7 Aug 2011, 10:41 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    Excess growth used to go to expansionary acceleration. Not now with Obama and the capital strike going on in this country. Good for the corpies. I'd withhold any plans also. This regime makes Mao Tse Tung look like Steve Wynn.
    7 Aug 2011, 10:45 PM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    Well maybe not 3 nanoseconds....looks like it'll be more like 3 days or so, soon as Italy bites the big pepperoni.
    7 Aug 2011, 10:54 PM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    How long will France's debt rating remain intact when Italy and Spain default on the $700 billion they owe France???
    7 Aug 2011, 10:56 PM Reply Like
  • Derek A. Barrett
    , contributor
    Comments (3534) | Send Message
     
    Nice Schadenfreude there Mark but too bad ECB is going to buy it anyway.

     

    Europe is USA 2008 and they will get their rescue package
    7 Aug 2011, 11:12 PM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    So Lightway...does that mean that within 2 years...they will all get their downgrades like the US did on Friday. Believe me, I would hope that someone could figure this out and stop the crash that is in the process of happening. But, I don't see any evidence that someone has a magic bullet to prevent the deterioration from continuing.
    7 Aug 2011, 11:51 PM Reply Like
  • Hitesh Patel
    , contributor
    Comments (314) | Send Message
     
    This is bullish, it will crush the dollar and since everything is priced in dollars, stocks can now rally.....pheew we dodged another bullit
    5 Aug 2011, 10:36 PM Reply Like
  • davidshelton
    , contributor
    Comments (310) | Send Message
     
    Ha! I love your optimism or is it sarcasm?
    5 Aug 2011, 10:40 PM Reply Like
  • lowemoran
    , contributor
    Comments (130) | Send Message
     
    But oil is priced in dollars....$120 oil here it comes.
    5 Aug 2011, 10:53 PM Reply Like
  • Windsun33
    , contributor
    Comments (4265) | Send Message
     
    Hitash - you may actually be correct, for commodities at least. Gold, copper, silver, oil, iron ore - all priced in dollars. Cheaper dollar should see many of those go up.
    6 Aug 2011, 12:00 PM Reply Like
  • kaa1016
    , contributor
    Comments (175) | Send Message
     
    Everything that is going on right now is not inflationary, but deflationary. The credit markets are telling that story loud and clear. All risk assets will be repriced lower in order to reflect the de-leveraging process and economic slowdown that is taking place globally. Brazil and India have inverted yield curves and short term notes in this country have a negative yield. You have to watch the price action of various currencies and debt markets in order to get the real picture.
    6 Aug 2011, 12:09 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    "Cheaper dollar should see many of those go up. "

     

    Then did they really go up at all?
    6 Aug 2011, 01:26 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    Yeah, a Chinese 'slowdown' means instead of inflation at 9% yoy, they're coming in at 6%. LOL.

     

    Sounds like the Great Depression.

     

    heh
    6 Aug 2011, 01:27 PM Reply Like
  • Windsun33
    , contributor
    Comments (4265) | Send Message
     
    And those other stupid countries, like Brazil, only running a $25 bilion or so budget SURPLUS every month.
    7 Aug 2011, 05:47 AM Reply Like
  • 1980XLS
    , contributor
    Comments (3314) | Send Message
     
    Terry's twins are cute. I don't care what she says.
    5 Aug 2011, 10:39 PM Reply Like
  • coddy0
    , contributor
    Comments (1182) | Send Message
     
    Her native mind, so void of art,
    But I adore my Peggy's heart.
    5 Aug 2011, 11:07 PM Reply Like
  • kaa1016
    , contributor
    Comments (175) | Send Message
     
    The market effect to this downgrade will be exactly zero. This move has been telegraphed for 2 weeks. S&P said they wanted to see $4 trillion in cuts and they didn't get it. What is moving the market is the risk of systemic contagion in the banking sector that will end the global "recovery". Expect some kind of coordinated statement regarding Europe's debt issues from the G7 before Asia opens Monday morning and watch the Dow futures gap higher by at least 200 points. Expect a tradable move through the FOMC and then take profits because they will disappoint the markets with their lack of clarity on QE3.

     

    There's plenty of blame to go around. That's the easy part. The hard part is figuring out a solution. I believe that the problem is excessive debt, period, whether on public or private balance sheets. We need to de-leverage the financial system which means that bond holders will have to take losses, which will cause an even greater depression. That's what's supposed to happen following the biggest credit boom and bust of all time. The country survived after the 30's, right? Pain avoidance is not a solution, it only masks the problem.
    5 Aug 2011, 10:56 PM Reply Like
  • Lebarjo
    , contributor
    Comments (36) | Send Message
     
    We could inflate our ways out of the private debt problem, but the Fed is too intimidated by politicians to act, and the FOMC is divided ideologically. There seems to be almost a worldwide conspiracy to protect creditors.
    5 Aug 2011, 11:11 PM Reply Like
  • rothyman
    , contributor
    Comments (126) | Send Message
     
    I'm hard pressed to believe Dow futures will 'gap higher 200 points' on Monday.

     

    If they do, you are truly a psychic. Either that or they announce QE3 tomorrow.. highly unlikely.
    5 Aug 2011, 11:24 PM Reply Like
  • Windsun33
    , contributor
    Comments (4265) | Send Message
     
    rothy - I don't expect 200 points.. but I do think up is much more likely than down. Might be an initial panic spike down, but I think in the end the market will close postive on Monday.
    6 Aug 2011, 12:02 PM Reply Like
  • lowemoran
    , contributor
    Comments (130) | Send Message
     
    Yep, everyone is saying nothing is going to happen to the stocks....

     

    Guess what? Everyone was saying we would have a rally after the debt deal....
    5 Aug 2011, 11:22 PM Reply Like
  • Thumper517
    , contributor
    Comments (8) | Send Message
     
    What market will be affected? Bonds or equities, or both?

     

    Thanks S&P, you are doing the country a service. You were bought and paid for in 2008 by Wall Street, hell, they gave you your models to assess the CDO's. So now you are overcompensating, but thanks anyway. You are doing us all a favor.

     

    Imagine the balls over there this week. Every kind of political pressure probably has been applied by the ruling class in Washington and on Wall Street, but they went ahead with the down grade anyway.
    5 Aug 2011, 11:22 PM Reply Like
  • Lebarjo
    , contributor
    Comments (36) | Send Message
     
    If CNBC hasn't got around to it already, soon they will say that bond prices will come crashing down on Monday while interest rates spike on everything that has variable interest like credit cards. The rest of us are expecting a collective yawn.
    5 Aug 2011, 11:29 PM Reply Like
  • SlingWing9
    , contributor
    Comments (480) | Send Message
     
    I suspect Monday's open will be sell first, ask questions later. It's a good time to either be short or in cash until the dust clears enough to make a rational decision.

     

    I cannot imagine what China is going to say about all this but I'm sure it won't be pleasant. I would imagine they have already convened an emergency meeting by now to formulate a statement and a position. I wonder if they could force a default with plans to emerge the dominant global economic power and displace our currency as the international currency of choice; after all, in March 2009, as a result of the global economic crisis, China pressed for urgent re-consideration of a global currency other than the dollar. There is precedence for this - remembering the Yen was the currency of choice during the 80s but the Japan recession of the 90s ended that which led to the Dollar taking center stage. To take this a step further, will this downgrade the U.S. as the world's preeminent economic superpower. The point being, it would seem obvious that this credit downgrade is going to have substantial international repercussions.

     

    As a sidenote, it is my understanding that by S&P's own rules, they cannot rate a company's debt higher than they rate the country. It will make for an interesting day.
    6 Aug 2011, 12:09 AM Reply Like
  • The Enterprising Value Inve...
    , contributor
    Comments (512) | Send Message
     
    DO tell me where China is going to park all of its money?

     

    Russia? Switzerland? Europe?!
    6 Aug 2011, 12:20 AM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    China will have to keep buying dollars unless they are willing to let the Yuan strengthen. Maybe now's the time for that. They certainly are accumulating gold at the sovereign level and at the individual citizen level. It would be fun to see them go looking for about a billion ounces of silver.
    6 Aug 2011, 12:24 AM Reply Like
  • The Enterprising Value Inve...
    , contributor
    Comments (512) | Send Message
     
    I would be all for that. Would start to make the current account more balance. It would create an incentive for US manufacturing and the yuan becomes stronger against the dollar.

     

    I have always thought the Chinese need to speed up their revaluation of the yuan vs the dollar to move the Chinese economy away from exports and towards consumer spending. However, I am concerned their productivity and thus their wages will be insufficient to sustain it at this point.

     

    And sorry, no country would substitute metals for currency, even the fiat kind.
    6 Aug 2011, 12:47 AM Reply Like
  • Windsun33
    , contributor
    Comments (4265) | Send Message
     
    China probably loves it - it means they can get an extra 10 or 20 basis points of interest on their loans.
    6 Aug 2011, 12:07 PM Reply Like
  • citizenleung
    , contributor
    Comments (247) | Send Message
     
    Reagan set us on the path of borrowing and spending, and we have followed it, year after year, for thirty years. That's how the U.S. got to where it is today.

     

    The S&P said that it wanted to see Obama's grand bargain passed as a down payment on debt reduction. The teabaggers refused. End of story.
    6 Aug 2011, 12:11 AM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    Pretty simple and straight forward.
    6 Aug 2011, 03:53 AM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    Your stories are changing turbo-lefties, whenever you want them to, or its most convenient. So, did Billy Yeehaw Jethro not balance the budget & provide a surplus like you constantly parrot or not? Seems that after "30 years"(in BJ's case 12), that trend of spending stopped, according to you lefties, even if it was a hard right GOP majority that forced the action on the pervert hillbilly.

     

    The S&P said they wanted to see a min. of $4 trillion in cuts... NOW.

     

    Pelosi & Reid refused.

     

    Obama went along with them and promised to shriek hysterically on camera about corporate jets like the plastic game show host he is and do what he's told.

     

    Boehner got all he could get, unfortunately. The Tea Party just wasn't strong enough, again, unfortunately to stop the downgrade.

     

    You can thank Pelosi, Reid & Obama for that.

     

    Pretty simple and straight forward.
    6 Aug 2011, 01:33 PM Reply Like
  • Derek A. Barrett
    , contributor
    Comments (3534) | Send Message
     
    They also said they wanted to see expiration of tax cuts for the wealthy Wyatt, but "YOU GUYS" and your Tea Baggers keep refusing, but somehow you just conveniently keep leaving that part out.

     

    So don't use S&P as some standard bearer of fiscal guidance when you only tell half of the story.

     

    And by the way, none of those tax cuts affect 99% of the people that post on this site, so I find it ridiculous how you so veraciously defend them.
    6 Aug 2011, 07:52 PM Reply Like
  • 1980XLS
    , contributor
    Comments (3314) | Send Message
     
    Darkway,

     

    Given that about 47% percent of the population pay no income taxes, to suggest that the tax cuts have benefited only the wealthy is nothing other than assinine.

     

    As far as all the problems being solved by only taxing the "rich" being a simple solution to the problem, that's BS and you damn well know it.

     

    If you don't, you are ignorant to the demograp